Should You Buy A Trade Mark Instead Of Registering A New One?

You don’t always have to start from scratch to acquire a registered trade mark.  Sometimes the smartest move is to buy an existing one.

The traditional route to securing legal protection for a trade mark is to file an application with IP Australia, but buying a trade mark that has already been registered may actually be a quicker and more cost-effective option.  Buying an existing trade mark also eliminates any uncertainty about whether or not the application will be successful.

Let’s consider the scenario where a new business wants to use a particular name, but a search through ASICS’s register of business names has revealed a conflict.  There may be merit in investigating the status and the circumstances of that existing business name more thoroughly to ascertain whether it is a registered trade mark and whether there is an opportunity to buy it. 

A search may even find that the trade mark is no longer valid (eg if it has not been renewed timeously or if it hasn’t been used as intended) or that it has been abandoned.  In that case, whilst you could not purchase the trade mark, it could indicate it is available to register again as a new trade mark.

  The process of acquiring an existing registered trade mark can be complex depending on the circumstances, which is why you should always consult with an expert for advice and guidance.

Pros and cons of buying an existing trade mark

A registered trade mark legally protects your company’s unique brand, product or services and it helps customers differentiate you from your competitors.

While it is possible to acquire the rights to a trade mark, it’s not always easy finding an existing one that fits seamlessly with your business’s identity, its message, its relationship to customers and the markets you operate in (or intend operating in).  

On the other hand, an advantage of buying a ready-made trade mark is its immediate availability.  As soon as the trade mark is transferred to you/your company, you have legal protection of your intellectual property asset and can assert those rights over your competitors. 

A great benefit of considering purchase of a trade mark, rather than start a new, is that if you acquire an old trade mark, any use by others of confusingly similar brands after the filing date of that trade mark may infringe that trade mark. Conversely, if you are just starting out and file a new application, then businesses that used similar branding before you first used your name, or filed an application (whichever is earlier) will be taken to not infringe in accordance with Australia’s trade mark laws (which recognise the rights of prior continuous users).

An existing trade mark can also be a viable option for a new product that needs to hit the ground running in a highly competitive market.  

What does an existing trade mark cost?

There’s no official fixed or recommended cost of an existing trade mark. 

The price will need to be negotiated with the registered owner and a number of factors will need to be considered such as the goodwill of the business, its share of the market and its competitive advantage. If the registered trade mark has essentially been abandoned, despite remaining registered, the owner is more likely to accept a reasonably low price.

Further, if a trade mark remains registered to a company that has since been deregistered with ASIC, those trade mark rights effectively lie with ASIC. In those cases, there is a formal process to follow if you wish to acquire the trade mark from ASIC.

An experienced trade marks attorney will be able to assist you in determining possible trade marks to purchase and/or the appropriate steps to take in terms of negotiation with the trade mark owner (or ASIC) and, if the deal is successful, arranging the formal ownership transfer with IP Australia.

A last word on buying an existing trade mark

Buying an existing trade mark can save you both time and money, but there are provisos.  It needs to be the right fit for your business and it needs to match your needs – otherwise you may find that what you thought was an economical and simple shortcut was actually a counterproductive waste of resources. 

It’s also important to understand that conflicting trade marks aren’t always a no-go area.  If you have found an existing trade mark that you think may be a good fit for your business, you’re welcome to get in touch with MMW Trade Mark Services.  Our highly experienced trade marks attorneys can advise on the best way forward and will ensure that any action taken meets the Australian trade mark regulations and that your rights are fully protected.

If you want an experienced, reliable and affordable local trade marks attorney firm on your side, please contact us through the website or give our friendly team a call on 03 8288 1432.  We can help with any aspect of trade mark registration, both in Australia and overseas.