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What is the Function of a Trade Mark?

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If you have set up a business or have already established a business, you might wonder if registering a trade mark is a good option. A trade mark is one form of intellectual property (IP) protection that protects your brand assets. But first, it is essential to understand trademarks and their purpose. This article will take you through the primary function of a trade mark, the benefits of registering one, and eligibility for trade mark registration.

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What is a Trade Mark?

A trade mark refers to any sign that distinguishes one business from another. As a form of IP, a trade mark is an essential asset for any business.

Trade marks can take many forms and may include your business:

  • name;
  • logo;
  • packaging;
  • colours; or
  • slogan.

A registered trade mark gives you exclusive rights to use, license and sell your trade mark. Indeed, this ensures that your brand can stand out amongst your competitors. In addition, this means you can prevent others from using your trade mark without consent.

What are the Functions of Trade Marks?

Before registering a trade mark, you must understand the function of a trade mark. This will help you determine if your trade mark is solid and eligible for registration.

Essentially, a trade mark serves to identify a product or service as belonging to a specific business or person, also known as a ‘badge of origin’. As the owner of a trade mark, this provides two main benefits, being:

  • legal protection; and
  • marketing.

Firstly, trade mark registration primarily functions to provide legal protection to businesses. With exclusive rights to the use of your trade mark, your brand is more likely to stand out from competitors and where you consider your trade mark has been infringed, you can take legal action.

Secondly, as a badge of origin, your trade mark serves as an essential advertising and marketing tool. Having exclusive rights to your trademark will eventually become synonymous with your product or service, helping increase the value of your business.

When you consider how many companies are recognisable by their brand, the importance of a strong trade mark becomes quite clear.

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What are the Benefits of Registering a Trade Mark?

Although you do not have to register a trade mark to assert rights to it, registering your trade mark has several benefits.

For example, a registered trade mark:

  • is listed on the public trade mark register, acting as a deterrent to others from using your trade mark without your consent; 
  • allows you to take legal action if someone infringes on your mark;
  • can be easily bought, sold, or licensed, making it an excellent asset; and
  • serves as a defence against infringement accusations, reducing the risk of later being involved in a trade mark dispute.

Can I Register My Trade Mark?

It would help if you considered whether your proposed trade mark will be eligible for registration before applying. There are certain limitations on what can and cannot be registered as a trade mark, such as:

  • descriptive words, however, it cannot describe the quality, purpose, or other descriptive characteristics of the goods or services for which it is being used;
  • common words or images (trademarks cannot incorporate any word or phrase that other businesses in the industry regularly need);
  • words restricted by legislation, such as words relating to financial services that are prohibited for use in a trade mark class 36; and
  • words and signs prohibited by international convention, including various signs such as flags, emblems and abbreviations and names of intergovernmental organisations.

Key Takeaways

A trade mark acts as a ‘badge of origin’ to identify a product or service as belonging to a specific business or person. The two main functions of a trade mark are to serve as:

  • legal protection; and
  • a marketing tool.

If you need assistance registering a trade mark for your business, our experienced trade mark lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.

Frequently Asked Questions

What is the function of a trade mark?

A trade mark acts as a ‘badge of origin’ to identify a product or service as belonging to a specific business or person. As the owner of a trademark, this provides two main benefits: legal protection and an excellent marketing tool.

What are the benefits of registering your trade mark?

Although you do not have to register a trademark, registering your trademark has many benefits. For example, a registered trade mark is listed on the public trade mark register, can be easily bought, sold, or licensed and serves as a defence against claims of trade mark infringement.

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