Can you transfer ownership of a trade mark?

Written by Mohammad Khan | May 30, 2022

IP Contracts

A trade mark gives the owner an exclusive right to use the registered brand name and/or logo for a period of 10 years, renewable for subsequent 10-year periods without a limit in time.

There are countless examples of logos or names we identify with and have welcomed as part of our daily lives when we look around. Businesses have invested infinite resources into connecting with their consumer market and becoming the brand of choice for their buyers. Imagine how you would feel if McDonald’s was promoted by Kernel Saunders or if the purple colour associated with Dairy Milk was instead used on packets of Maltesers – it just makes your head spin, does it not?

So, trade marks are not just boring legal issues. They are there to protect the name or image built through an invaluable effort by businesses to create a brand and a reputation. So, what happens when a business wishes to take over another trade mark? Say, for example, a rapidly growing startup wishes to purchase an existing trade mark, or a company wishes to transfer trademark ownership to an individual director or subsidiary. Is this possible?

The short answer is yes, ownership of a trade mark can indeed be moved from one entity to another. Transferring ownership is known as a trademark assignment. To complete the change of ownership, a trademark assignment agreement must be drawn up and agreed upon between the assignor (the existing trademark owner) and the assignee (the new owner).

The longer answer, however, is more complicated as several legal complications should be considered before you transfer ownership.

It is important to think about matters such as:

  • Value – There are several things to consider when valuing an intangible product that in itself has no clear monetary value. If you are selling or buying a trade mark then you would wish to ensure that you get the right price for the right registration;
  • Contract – A well-drafted contract is vital when transferring ownership. You want to ensure that terms relating to all aspects of the trade mark and its resemblance are covered and that both the benefits and the liabilities that could arise in the future are clearly agreed upon; and
  • Legal formalities surrounding a successful transfer and the trade mark itself: Is the trade mark registered in the class you wish to use? Is it registered in the countries you wish to operate in? Is it still valid, or does it risk being struck off? Is that which is being transferred agreed upon (for example, is it a partial assignment or complete assignment of the rights)?

More to consider than you had thought, right? The complexity of issues like legal ownership changes of intellectual property rights usually requires a specialist lawyer to consult throughout the process, plus draft and review documents, contracts and more. After all, you don’t want to get something wrong, or not account for a particular situation, and then run the risk of a costly dispute in the future.

If you’d like help with a trademark assignment, or anything to do with transferring the ownership of intellectual property, including trade marks, design rights and copyright, we’re here to help. This is an area we specialise in. Get in touch with our IP team today to organise a free consultation.

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