Trademark proprietors have the ability to transfer their trademarks much like physical properties. One common method of doing this is through trademark assignment, which involves the transfer of rights, interests, titles, and benefits from one party to another. In the context of trademark assignment, the transferring party is referred to as the assignor, and the receiving party is known as the assignee. Under Section 2(1)(b) of the Trade Marks Act, 1999, assignment is defined as the transfer of a trademark in writing by the involved parties. Notably, both registered and unregistered trademarks can be assigned, either with or without the associated goodwill of the business.
Who Can Assign a Trademark? As per Section 37 of the Trade Marks Act, 1999, the individual registered as the proprietor of a trademark in the register of trademarks holds the authority to assign a trademark and receive consideration for such an assignment. This means that a trademark proprietor has the ability to assign their trademark to another party.
Types of Trademark Assignment:-
1. Complete Assignment: In this type of assignment, the trademark proprietor transfers all rights in the trademark to another party. This includes the right to earn royalties and further transfer the trademark. After a complete assignment, the assignor no longer retains any rights to the brand.
2. Partial Assignment: With partial assignment, the trademark proprietor assigns the trademark to another party specifically for certain goods or services. Ownership is restricted to these specific products or services.
3. Assignment with Goodwill of Business: In this scenario, the trademark proprietor assigns not only the rights but also the associated values and goodwill linked to the trademark to another party. This allows the assignee to utilize the trademark across various classes of goods or services, including those already in use by the assignor.
4. Assignment without Goodwill of Business: In cases of assignment without goodwill, the trademark proprietor transfers the rights and entitlements in the trademark only for products or services not currently in use. This type of assignment includes restrictions to prevent the assignee from using the trademark for products or services that were previously in use by the assignor.
Prerequisites for Assignment of Trademark:-
- The assignment must be in writing.
- The assignor and assignee must be clearly identified parties.
- The assignor must consent to and have the intent for the trademark assignment.
- Adequate consideration (amount) must be involved in the assignment.
Trademark Assignment Agreement: Typically, trademark proprietors assign their trademarks to assignees through a formal trademark assignment agreement. This agreement should consider various aspects, including ensuring that the rights of the trademark are not negatively impacted by the terms of the agreement. It should specify whether the assignment is with or without goodwill, the geographical scope of the assignment, and the rights to collect and sue for damages. Additionally, the agreement should be properly executed, often requiring stamping and notarization per applicable Stamp Acts.
Process of Assignment of Trademark: The steps involved in the assignment of a trademark in India are as follows:
1. The proprietor of the trademark (assignor) uses a trademark assignment agreement to assign their rights in the trademark to the assignee.
2. The assignor, assignee, or both parties can jointly request the registration of the assignment by submitting a trademark assignment application (Form TM-P) to the registrar of trademarks.
3. Form TM-P should be filed within six months from the date of the assignment, but it can be filed later, with fees adjusted accordingly.
4. The assignment is required to be advertised as per the registrar's instructions.
5. The copy of the advertisement and the registrar's directions should be submitted to the registrar of trademarks.
6. Upon receiving the trademark assignment application and necessary documents, the registrar of trademarks will register the assignee as the trademark proprietor and record the assignment details in the register.
Documents Required for Assignment of Trademark: The following documents must be submitted to the registrar of trademarks along with Form TM-P:
- Trademark assignment agreement
- Trademark certificate
- No Objection Certificate (NOC) from the assignor
- Identification documents of both the assignor and assignee
Restrictions on Assignment of Trademark: The Trademarks Act, 1999 imposes certain restrictions on trademark assignment, including:
- Parallel Use Restriction: Trademark assignment leading to the creation of exclusive rights in different persons for the same or similar products or services, causing confusion, is not allowed.
- Multiple Territorial Use Restriction: Trademark assignment creating exclusive rights in different persons in various parts of India for the same or similar products or services is not permitted.
Benefits of Trademark Assignment:-
- Trademark assignment allows trademark proprietors to monetize their brand's value.
- Assignees gain the rights to an established brand through trademark assignment.
- It supports both the assignor and assignee in expanding their businesses.
- The assignment agreement establishes the legal rights of both parties in case of disputes.
Disclaimer:-
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