Trademark law

FAQ on trademarks and trademark law

What is a trademark?

A trademark is a name, a company name, a term, a logo or a combination of these that identifies a company, goods or services. The purpose of trademarks is to symbolise an origin that you associate with certain contents, such as quality, price merits and others.

A trademark constitutes a monopolist right; similarly to ownership of an article of property, the trademark owner can proceed with his trademark almost exclusively as he pleases, which means that he can for instance exploit the trademark himself, he can sell it or license it to single or multiple third parties.

How does a trademark come into being?

German trademarks are usually created by entering them in the trademark register kept at the German Patent and Trademark Office. In certain cases, trademark protection can come into being by means of exploitation of a name, namely in that moment when this name has become so popular that it recognised by a considerable number of people in an addressed target group who see the name as a trademark of a certain enterprise.

How much does a trademark registration cost?

The German Patent and Trademark Office presently charges € 300 for the application for a trademark combined with an entry in the trademark register. The official registration fee includes trademark protection for 10 years. This sum does not, however, include pre-application costs, such as possible research costs, as well as legal fees.

Who prevails when two parties have chosen the same trademark?

Generally speaking, the party that has first registered a name as a trademark for goods or services has “better rights”. The day of the registration is decisive here. From the day a trademark is registered, its owner has the exclusive right to exploit the name for the entered goods or services within the whole area of the Federal Republic of Germany.

Is it possible to “reserve” a trademark before actually exploiting it?

It is not obligatory to exploit a trademark immediately; it can therefore be “reserved” by means of registration. It is only when five years have passed that a third party can object to the so called “non-exploitation”. The same laws can be derived from such “reservation” as in the case of immediate exploitation.

Need trademarks to be registered?

In most cases, it is necessary to register a trademark in order to assert the rights to a name and to exploit other advantages of a trademark. It is not obligatory, though.

What are the advantages of a trademark registration?

A registered trademark is attested in the form of a certificate for the trademark owner and results in an almost monopolist trademark protection in favour of the owner in the area of the whole Federal Republic of Germany. The existence of a trademark right can be proven to a large degree by means of a certificate.

A registered trademark can turn out to be extremely important when registering or preserving a domain name in the internet. Contrary to trademark registration, domain registration under private law does not guarantee any rights.

Moreover, a trademark offers recognition among competitors. Usually, the trademark register is consulted when looking for a new name in order to avoid a name similar to one that has already been registered. Furthermore, a trademark can safeguard a company name. At entering a company name the commercial register examines merely locally whether such a name has already been entered. Even an enquiry directed at a local Chamber of Trade and Industry does not result in an examination on a nationwide level. It can therefore be sensible to secure a company name by means of a trademark.

Apart from these protective and informative functions, trademarks also offer protection against counterfeit merchandise concerning services and goods.

When should a trademark be registered?

You should apply for a trademark as soon as possible since the day of the application decides since when a trademark protection begins.

Is a trademark search necessary prior to applying for a trademark?

The filing of an application for entry in the register of trademarks is only recommended after completion of a trademark search. If there already is a similar or identical trademark for similar goods or services, a later application would usually be “a waste of money”. In addition, the original owner of a trademark can demand the release of a trademark by means of a caution at a fine.

A “simple” search among trademarks effective in Germany (German trademarks, European Community trademarks and international trademarks with Germany being the country of destination) brings about costs – in case of a similarity search – amounting to approx. € 200. Not only do results of such a search answer the question if a similar trademark has already been registered, they also offer an overview of similar registered trademarks.

Trademark search is usually conducted by specialised companies, such as ideahelp or Compumark NV.

Are there any possible hindrances to entry?

The Trademark Act specifies a number of entry hindrances. Thus, descriptive names and generic concepts (such as “computer”) cannot be registered. The same applies to certain general names, since they must be kept available or because they cannot be distinguished from one another. For example, “company consulting” for the service known in German as “Unternehmensberatung” would have to be kept available.

What is trademark licensing?

The owner of a trademark can “lease” his trademark, i.e. “license” it for a licence fee. Contrary to e.g. a rented flat, a trademark can be licensed as a right to as many interested parties as the owner wishes. Being a monopolist, the trademark owner can place numerous conditions, which would normally not be allowed. This results from the fact that a trademark is desired as a monopoly.

How is a trademark entered?

Filling in and handing in an application for a trademark registration to the German Patent and Trademark Office of leads to entering a trademark by the Trademark Office following the examination concerning certain protection hindrances. The German Trademark Act describes a number of reasons for the rejection of trademark applications. Therefore, it is important to make every possible effort to handle the trademark application professionally.

What does the German Patent and Trademark Office examine?

The Patent and Trademark Office examines first of all absolute protection hindrances, apart from the formal examination of the application, i.e. whether all statements comply with the legal requirements and whether all fees have been paid. If no such hindrances have been stated and if the formal examination has been successfully completed, a trademark is entered into the trademark registry and published in the official journal. Within three months’ period, third parties can raise an “objection” to the trademark entry. Usually three to twelve months pass from the day of filing an application until the trademark is entered. The examination is completed within six months in the case of the so called summary examination, requiring additional fees.

How much does it cost to maintain a registered trademark?

A registered trademark is protected for a period of ten years starting from the day of registration without any additional charges. Each trademark can successively be extended by further ten year periods. If it turns out after ten years that a trademark should be mainained, an extension fee has to be paid to the Patent and Trademark Office.

What value does a trademark have?

The value of a trademark cannot be estimated generally. Basically, the more established a registered trademark is within the market target group, the more valuable it is. Newly registered trademarks can be included as an asset in the financial statement, but initially only to the amount of the registration fees including all additional costs. There are no limits for the value of a trademark

What information do we need to register a trademark?

Name and address of the party wanting to register a trademark who will later be the trademark owner. In the case of foreign enterprises you also need to know under which jurisdiction the enterprise was founded.

The exact sign, logo, etc., which should be registered (a single word, a combination of word/picture or other – as soon as the registration has been forwarded to the Trademark Office no alternations can be made, therefore it is necessary to indicate the sign exactly).

The goods or services that should be connected to the trademark.

Please contact

Michael Horak, Graduate engineer, LL.M. horak@iprecht.de

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