What is the procedure of trademark assignment in India?

Every owner of a brand or trademark has the right to sell, license, transfer, etc. its trademark. The procedure of trademark assignment is the process of transfer of ownership of trademark from one person to another. The trademark owner transfers all the rights of the trademark to the receiving party. The trademark owner can transfer his right either by assignment or by licensing. Subsequent to the trademark assignment, the assignee will become the proprietor of the trademark. Trademark Act, 1999 deals with trademark assignment and licensing.

Here in this article, we will deal with trademark assignment, the procedure for trademark assignment, and much more.

What is a trademark assignment?

A trademark assignment is a written document which helps to transfer a recognized word, phrase, and symbol or design from the original owner to another owner. The original owner of the trademark is known as “the assignor,” and the future owner is known as “the Assignee.”

The assignment of trademark occurs when there is a transfer of the owner’s right, title, and interest with respect to the trademark. In other way, we can say it is the transfer of ownership with or without the goodwill of the business. In case the trademark is registered, such an assignment has to be recorded in the Register of Trademark.

It is the most prized possession because it aids the customers to associate with the recognized brand quickly.

How can one assign a trademark?

You can assign a trademark through a trademark assignment agreement. Even though it can be proved by oral evidence, we should always prefer an oral assignment. One of the most important elements of the agreement is that there must be an intention on the part of the owner of the trademark for transferring ownership.

Trademark Assignment in India

Following are the different ways to assign or transfer trademark in India-

Complete assignment to another entity

The owner of the trademark transfers all the rights relating to the trademark like the right to further transfer, earn royalties, etc. The future owner will be the sole owner of the trademark.

Partial Assignment

When there is an assignment of trademark only for some of the goods and services, then it comes under this type of assignment.

Both complete and partial assignment of the trademark can be done with or without goodwill.

Assignment with goodwill

Under this kind of assignment, the rights and the value of the trademark that is associated with the product are also transferred.

Assignment without goodwill

When the owner of the brand puts a restriction on the rights of the buyer and does not permit him to use such a brand for products being used by the original owner, then it is called assignment without goodwill.

Furthermore, the goodwill which is attached to such a brand with respect to the product already being sold under the brand is not transferred to the future owner. In many countries like the USA, an assignment without goodwill is not permitted. But, it is permitted in India.

If there is a possibility of creating confusion in the minds of the existing public with regard to a registered trademark, the Trademark Act, 1999 puts certain restrictions on such assignments.  Some of the restrictions are:

• There is a restriction on trademark assignment, which results in the creation of exclusive rights for more than one person with respect to the same goods or services or for similar goods or services.
• The Act also puts a restriction on the assignment of the trademark, which results in different people using the same trademark in different parts of the country at the same time simultaneously.

Advantages of Trademark Assignment

Valid Proof

If there is a dispute related to a trademark, one can establish the legal rights easily with the help of the trademark assignment deed. The Registrar examines all the clauses in the deed.

Security

Under the Trademark assignment, the agreement is executed by both the parties. It acts like a valid proof which is admissible in court in case of a dispute. The assigned trademark is published in the trademark journal, and the Registrar scrutinizes all the clauses to avoid any hurdles.

Market Value

Trademark assignment has its own benefit from an already established brand. Purchasing a pre-recognized brand has its own advantage in terms of market base. Furthermore, the assignee does not have to invest his time and money on the marketing and creating the brand. Most importantly, the assignee doesn’t have to go through the registration process.

Agreements for transmission

One can assign trademark through trademark assignment agreement. We should take certain points in mind while drafting the trademark assignment-

• Due to the obligations, the rights of the owner are not affected.
• One should mention whether the assignment is with or without goodwill.
• And lastly, it should mention what the purpose of the transaction is.

While drafting the agreement, it is also important to pre-determine the rights and duties of the parties. It is important to not only protect the rights of the trademark owner but also secure the rights of the assignee.

How to draft a trademark assignment agreement?

Drafting a trademark agreement is the most important step in the procedure of trademark assignment and should always be done by professionals. The parties should always keep the following key elements in the agreement-

• The effective date for transfer
• The trademark
• Assignor and Assignee
• Consideration
• Warranties
• Signature
• Notary public

How to register Trademark Assignment with the Registry?

Following is the process to record the trademark assignment with the Registry-

Assignment of the unregistered mark

The Trademark Act, 1999 under section 39 stipulates that any unregistered trademark can be further allotted or transmitted with or without the goodwill. One can make a request for the same under form TM-16.

Assignment of a registered trademark

Section 38 of the Trademark Act, 1999 states that about allotment and transmission of the trademark with or without the goodwill of the business. It states that a trademark can be assigned in part with or without goodwill. All the assignments can be made on Form 23 or 24 of the Trademark.

What is the Procedure for Trademark Assignment Agreement?

Step 1

The first step is to make an application for the assignment of trademark either by the assignee or the assignor or both of them. The application should mention all the details of the transfer and be made under form TM-P.

Step 2

Once the application is complete, file the same with the Registrar of the trademark. It has to be done within 6 months of acquisition of proprietorship.

Step 3

When there is a trademark assignment with goodwill or of a registered trademark, the direction from the Registrar of trademark is mandatory before an expiry of 6 months (can be extended).

Step 4

The Registrar will specify the advertisement of the trademark assignment. After which the applicant has to make the advertisement accordingly. Copy of advertisement along with a copy of the Registrar’s direction should also be submitted.

Step 5

After the Registrar is satisfied with all the documentation, he shall officially transfer the trademark from the original to the new owner.

The name of the Assignee i.e., the new owner is to be registered in the register as a new proprietor.  After this, the assignee can use the trademark as per the terms of the agreement.

Which is the prescribed form for the trademark assignment?

An application for an assignment can be made under Form TM-24. The assignor and the assignee can make a joint request for assignment in Form TM-23.

Trademark Licensing

The concept of trademark licensing allows others to use the mark without the assignment of ownership. The Trademark Act does not talk about the license, rather it is mentioned under ‘registered user.’

It is beneficial to both the parties, the licensor enjoys the rights of the mark through royalties, and the licensee gets the power to expand its market operations using the brand name.

Conclusion

Trademark assignment is the most crucial step which opens a plethora of opportunities for growth of the business. Although it is not mandatory, one should always get a trademark assignment agreement, as this allows the parties to exercise the rights over any third parties. Additionally, the whole procedure for trademark assignment is easy, therefore it is advisable to get trademark assignment as soon as possible.

For more information about the trademark assignment, contact us at LawyerINC.