In the age of big data and new technology, companies are increasingly relying on intangible assets such as intellectual property, data and algorithms to drive their brand value.
Indeed, more than a third of the value of manufactured products sold around the world comes from “intangible capital,” according to the World Intellectual Property Organization.
Evidently, if brands wish to thrive in the global marketplace, they must identify and protect their IP, across the world.
With this in mind, the recent International Trademark Rights: Best Practices for a Trademark Global Presence webinar delved into best practices for protecting, managing and exploiting international trademark rights. Industry veterans engaged in a wide-ranging discussion, covering topics from the importance of local counsel to protecting your IP in China.
If you’re searching for advice on protecting, managing and exploiting your trademarks globally, look no further.
Local Counsel: Don’t be afraid to walk away
The importance of good counsel cannot be understated, but finding the right fit can be a challenge.
Investing time and energy to ensure you’re working with counsel that truly understands your brand and protection strategy in priority markets is crucial. It’s important to find the right fit—counsel who work hard to protect your trademarks, whether you own just one or a thousand.
As a trademark practitioner, you can lose a level of control when you look to local counsel to protect trademarks elsewhere. If you’re worried about this, speak to the counsel and seek reassurances that your portfolios will be protected and well cared for.
Takeaway: Make sure you’re working with counsel that truly understands your brand and protection strategy. Most importantly, if they’re not responsive or they don’t understand your strategy, be ready to make a change and find someone who works well with you.
Madrid Protocol—a perfect tool?
Put five trademark practitioners in a room and you’ll get five different opinions on the utility of the Madrid Protocol. While the Protocol does provide an economical way to register your trademark in up to 120 countries, the limitations of the system can deter practitioners.
If you file a trademark application using the Madrid Protocol, every registration is bound to the home registration. If the US is your home registration, and you stop selling in the country and lose your registration, all of the other registrations tied to it are also lost.
There’s also the issue of scope—in the US, which is a first-to-use system, practitioners file trademark applications that are very limited in scope. For example, if you sell speakers, you say that on your application. However, other jurisdictions don’t necessarily follow this and, in first-to-file countries, you can list as many goods and services as you like, meaning that you’re not necessarily going to get the same level of protection across the board.
Takeaway: The Madrid Protocol is a great tool for brands and practitioners to have, but it’s not the only one to rely on.
Building your defenses in China
The trademark practitioners’ experience with trademark presence in China perhaps deserves a section of its own, given the many issues that can arise in protecting and enforcing trademarks in the country.
If you’re hoping to have an international presence, you should consider filing in China sooner rather than later. Offensively, brands should register their trademarks to protect the marketplaces they’re marketing and offering their goods for sale in. Defensively, brands should look to register in counterfeiting hotspots, such as China.
While counterfeit and pirated goods originate from virtually all economies in all continents, China and Hong Kong continue to be by far the biggest origin, with China accounting for just under half of all counterfeits, according to a report published last year by the European Union Intellectual Property Office’s Observatory and the OECD.
And, even if you have very strong rights in certain classes, it can be incredibly difficult to stop infringers who have registered your trademarks in other classes.
Unfortunately, there are few options of reclaiming this ground—you could try to cancel the trademark based on non-use using local counsel or you can try and buy the mark, but they can go for a surprising amount of money (think five or six figures as a minimum).
Takeaway: This can be summed up very briefly: the earlier you can get your trademark protected in China, the better.
Gray Markets: Turning risks into opportunities
For brands selling their goods across jurisdictions, the threat of gray market goods—where an unofficial market exists for goods that haven’t been obtained from an official seller—is very real. Gray markets can be a major pain for brands, but they can also be an opportunity.
Finding out the reasons why and where gray market goods are being sold could mean the difference between a major enforcement problem and a real opportunity.
Some sellers, particularly the smaller players, may only be selling these gray market goods because approved distributors don’t want to work with them. Instead of enforcing against the sellers, your brand could choose to service these other channels.
Takeaway: Ensure you have a measured enforcement strategy and consider working with an outside vendor to operate a monitoring program.