According to the Trade Mark Act, 1999, A Trademark is a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others and may include the shape of goods, their packaging, and combination of colors. Trademarks are intellectual property used by companies and brands to secure their creativity and brand name. The Trademark Act, 1999 deals with trademarks in India. It deals with the protection, registration, and infringement of trademarks. A trademark shall be registered under a registering authority, enabling the right holder to seek redressal in case of violation. One can quickly sell a trademark in India since it is movable property. Such as sales can only be done through trademark assignment. Trademark assignment is defined as” an assignment in writing by the act of the parties concerned”.
Sell a Trademark: Here’s how
A trademark represents the company signifying the products or services provided by such a company.
Companies value their trademark, but in case of dissolution of the company or the company is being sold to a party, they sell their trademarks also since it is an integral part of that company. However, companies can sell a trademark before dissolution also.
Any person can sell a trademark through trademark assignment, i.e. assigning the trademark to the owner or another party. As per the Trade Mark Act, 1999, the assignment can be done with or without the company’s goodwill. Such an assignment shall be in writing.
The assignor( owner of the trademark) assigns the trademark to the assignee( person to whom the trademark is sold).
A trademark need not be a registered trademark to be assigned. An unregistered trademark can also be transferred as per Section 39 of the Trademark Act, 1999.
Benefits of selling trademark
Both assignor and assignee benefit from the sale of the trademark in the following way:
- Benefit to the assignor: The assignor, who created the trademark, gets a reasonable price for their hard work. They can get good value for the trademark assigned after the trademark is sold.
- Benefit to the assignee: The assignee gets a well-established trademark and can reap huge profits in future.
Ways to Sell a Trade Mark/ Trademark Assignment
Following are how one can sell a trademark/ assign a trademark :
- Complete Assignment: In this type of transfer of trademark assignment, all the rights and liabilities related to the trademark are transferred to the assignee. The assignee takes all the decisions regarding the trademark.
- Partial assignment: In this type of transfer of trademark assignment, certain rights are transferred to the assignee. The control over the trademark partially remains with the assignee, restricting rights over certain products or service’s trademarks.
- Assignment with unregistered trademark: According to Section 39 of the Trade Mark Act,1999, an assignor does not have a registered trademark. It can be transferred irrespective of whether it is registered or not.
- Assignment with goodwill: In this type of transfer of trademark assignment, the trademark’s value and the rights are transferred to the assignee.
- An assignment without goodwill: In this type of transfer of trademark assignment, certain rights pertaining to the trademark are restricted by the assignor. The assignee is not allowed to use the brand value of the trademark. It is also referred to as a Gross assignment.
Documents required for trademark assignment
Following are the essential documents required at the time of transfer of trademark:
- Certificate of registration of trademark in case of transfer of a registered trademark.
- No objection certificate from the assignor. Details of the assignor and assignee.
- Associated documents and details related to the trademark
The procedure of assignment of trademark
Following are the steps to be followed while a trademark is transferred :
Step 1: Apply for transfer via form TM-24 or TM-23. This application can either be made by an assignor or assignee, or a joint request can also be made.
Step 2: Fill Form TM-P.
Step 3: All the required documents of the assignor and assignee must be submitted to the registering authority. The application filing is needed to be done within six months from the date of accession of the company.
Step 4: Upon receiving the application, the registrar may direct the advertisement of the trademark assignment in a specific manner.
Step 5: A copy of the advertisement of the assignment is required to be submitted along with the copy of the registrar’s direction.
Step 6: The registering authority may ask the applicants to produce evidence in case any doubt arises.
Step 7: Upon clarification of the doubt, the application is approved by the registrar of the trademark.
Step 8: The registering authority registers the assignee as the owner of the trademark and records the specification of the assignment.
By way of assignment, one can sell a trademark in India. The Trade Mark Act, 1999 provides specific provisions regarding the assignment of trademarks. When a company is acquired by another company or the company is to be dissolved, it is a great option to sell the trademark as well. This will help the company to utilize the trademark in a better way. Before transferring a trademark, the assignee should always make sure that the trademark is appropriately valued. Upon such analysis, the process of transfer of trademark can be initiated. It is always recommended that the transfer process be registered before a registering authority to avoid future complications. However, the Trade Mark Act, 1999 puts certain restrictions on the assignment of trademarks, especially in the cases where the assignment gives exclusive rights of a product or service to the same entity or the assignment causes usage of the same trademark by multiple entities at the same time at different places. Except in these cases, the trademark transfer can be done by the assignor as prescribed in the Trade Mark Act,1999.
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