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Startups, trademarks and territorial scope of protection

One of the main strategic choices for startups is whether to register a trademark.

A trademark is a sign which allows businesses to distinguish their products or services from those of other businesses: In this way a bond is created between consumers and a business’ products or services.

The trademark may consist in any word, letter, number, drawing, photograph, shape, color, logo, label or combination thereof (having distinctive character).

A trademark chosen and designed with care has considerable commercial value for most businesses, becoming, in some cases, one of their most important assets (e.g. the Coca-Cola trademark).

Startups usually invest, therefore, in very attractive trademarks, as well as in attractive advertising and marketing strategies.

The extremely important role played by trademarks must, moreover, be stressed.

They attribute to rightholders the exclusive right to prevent other businesses from using identical or similar trademarks (which may cause a likelihood of confusion in consumers), for the commercialization of products which are identical or similar to those of the rightholder’s business.

By not registering a trademark, there is a risk of compromising investments made for promoting products or services.

It is of vital importance, therefore, that startups - in the light of the value of trademarks and of the role they play in the success of a product - should protect their trademarks in all those countries in which they intend doing business.

It must be pointed out, in relation thereto, that there are various levels of trademark protection:

1.National registrations: Businesses may decide to only protect their trademark in Italy. To this effect, it will be sufficient to file the application for registration (containing the elements indicated by article 11 of the Implementing Regulations of the Italian Industrial Property Code) at any Italian Chamber of Commerce or at the Italian Patent and Trademark Office (UIBM).

2. Community Registrations: Rightholders may also protect their trademark inside the European Union by filing (also by electronic means) a Community trademark application for registration at OHIM (the Office for the Harmonization of the Internal Market).

3. International Registrations: Rightholders may, moreover, protect their trademark at international level by filing an application for registration (passing through the UIBM) at the Geneva Offices of the World Intellectual Property Organization (WIPO), in which one or more Member States are designated. This will produce the same effect as filing filing national registrations for all of the designated countries.

4. Foreign registrations: Applicants may, alternatively, file separate national applications for registration in various (European and non-European) States in which they intend using their trademark.

Such decision must be taken by businesses on the basis of, among others, the following factors:

a) Available budget: The costs of registration and maintenance will be proportionate to the costs of registration and renewal thereof.

b) Relevant markets: It is advisable to register trademarks in all those countries in which rightholders intend doing business (in the event that the only relevant market is Italy, it will not be necessary, for example, to protect such trademarks in the United States).

In any event, web start-ups (that is to say new companies which potentially have a global market since they operate on the internet) will necessarily have to make a risk assessment from a costs-benefits point of view (unless, of course, they intend protecting their trademark worldwide!)

This post is also available in: Italian

Paul Bodenham

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