Home Views & Opinions Value & worth of trademarks in commercial activities and its legal aspects

Value & worth of trademarks in commercial activities and its legal aspects

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Marks are signs and symbols which are old as the history of the human being. They help people to demonstrate their concept relating to particular desires and plans for achieving specific goals. Now it is a realized fact that the sign and the symbol is the basic unit or character of human behavior and civilization. The Archaeology discoveries unfold the fact that unique images were incorporated by craftspeople for showing the origin of the particular product that who made it and where the concept of that came from.
A symbol or sign is a value that provides the meaning to a product by both, who made it and by whom used it. Actually, it represents, stand-in for, or suggests something else such as an idea or object within a market, gradually it becomes as a part and parcel of the value of the particular business. As it consistently used within a long period then becomes goodwill which regulates itself as an asset, also. However; in the remote past, there was no law protecting this kind of Intellectual Property. For the first time, in 1266 the parliament of England during the reign of King Henry III passed the first legislative act, which required all bakers to use a distinctive mark for the bread, they sold.
Looking into the non-avoidable importance of Trademark registration, countries in different parts of the world had taken initiative for making laws and establishing registration offices. There has been a controversy about the claim of the first registered trademark in the world. According to most of the researchers, the oldest registered trademark was the red triangle of the brewery company “Bass & Co.” which put on the bottles under the UK Trade Mark Registration Act 1875. But as per the recent research of prominent Polish Lawyer Miko?aj Lech, the oldest registered trademark is of PILSNER Beir which was got registered in 1859, Czech Republic.
People perceive, understand, and negotiate all the aspects of marketing in all around the world by investing meaning in all manners of Trademarks as a type of Intellectual Property which identifies products or services of a particular source quite distinct from others.
In the commercial world; trademarks have a powerful role by developing the confidence and trust of consumers that the goods and services they purchase are actually manufactured or provided by the companies owned the explicit trademark. In the way, the same trademark protects the business entities from unfair competitors in all manners and ways. The trademark plays an effective role as a communicative tool that carves promotional momentum to boost the business and protect the consumers from fraud and fake products. The principle for the protection of Commercial activities is decided by Lord Langdale M.R, in the case of Perry V Truefitt (1842) 49 ER 749 that a man is not to sell his own goods under the pretence that they are the goods of another man.
Trademark is the most precious asset of any business entity, similar to any other asset that can be bought, sold, mortgaged, licensed or used as a security interest to secure a loan. The importance of Trademarks as highlighted by Thomas D. Drescher in The transformation and Evolution of Trade Marks-from signals to symbols to myth page No.301-02 is quoted as under:
“The production plants and inventories of the coca-cola company could go up in flames overnight. Yet, on the following morning there is not a bank in Atlanta, New York, or anywhere else, that would not lend this company the funds necessary for rebuilding, accepting as security only the inherent goodwill in its Trade Marks ‘Coca Cola’ and ‘Coke.”
There are a number of International Treaties agreed upon by a number of nations for providing a protective shield for owners of the trademark in order to save their all struggles and efforts done for their commercial interests. There are pertinent to mention here four most significant treaties; the ‘Paris Convention for the protection of Industrial Property (1883)’, the ‘Madrid Agreement Concerning the International Registration of Marks (1891)’, the ‘Trademark Law Treaty (1994)’ and the ‘General Agreement on Trade Related Aspects on Intellectual Property (1995)’ known as TRIPS.
In Pakistan, the Trade Marks Act 1940 was adopted but in order to comply with the obligations under the TRIPS agreement, it has been repealed and replaced with Trade Marks Ordinance 2001. As per the provisions of the Trade Marks Ordinance, the Trade Marks Rules 2004 were promulgated setting out the entire process and procedure for all matters that are ancillary to the trademark registration and all the steps beyond.
Generally, the registered trademark is protected by and under the trademarks ordinance 2001 in Pakistan. If any registered trademark is infringed by any other then the proceedings of infringement can be initiated in the tribunal or court having territorial and legal jurisdiction. As per section 46 of The Trade Marks Ordinance that in an action for infringement all other relief may be sought such as damages, injunctions and accounts simultaneously and not as an alternate to each other. The registration of Trademark provides the exclusive right to its proprietor to use the trademark for governing over, promoting of and sustaining for the commercial activities as to particular business.
However, sometimes the doctrine of Passing-off is invoked by the courts of Pakistan in the purview of common law that recognizes the rights of unregistered trademarks owners as prior user or adopter. Passing off action may be independent as it may be coupled with infringement. It is maintainable irrespective of the fact that the trademark is registered or unregistered. But it is not an easy task to prove the existence of an unregistered trademark as active in the field and the goodwill attached to it with such an excellent reputation which signifies the distinctiveness of the trademark. In several cases, even bearing the huge cost of litigation the unregistered trademark owners lost their cases as can’t afford to discharge the heavy burden of proof before the courts.
Other laws also protect the trademarks being the property of an individual or of any association. As per section 482 of the Pakistan Penal Code “Whoever use any false trade mark or any false property mark shall, unless he proves that he acted without intent to defraud, be punished with imprisonment of either description for a term which may extend to one year, or with fine, or with both.” As well as the Competition Act, 2010 plays a vital role in safeguarding the commercial activities of business entities. In 2019 The Competition Commission of Pakistan (CCP) has imposed penalty of PKR 5 million on a Lahore-based cafĂ© owned by Options International (SMC-Pvt.) Limited for violating Section 10 of the Competition Act, 2010 by fraudulently using the official logo of international coffeehouse chain, STARBUCKS.
Besides the civil and criminal litigation, the Customs law is empowered in trademark-related matters. Customs Act 1969, prohibit the import and export of counterfeit goods. The offender is liable for detention and the infringing goods can be seized or confiscated.