Legal protection for Trademark Portfolios of Sri Lankan Businesses….
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Introduction to IP Rights
The creative endeavours and inventions, known as intellectual property (IP) rights is an intangible asset that has potential financial value to any business. In fact, IP rights have the potential to form a considerable portion of the market value of any enterprise be it startups, medium or large scale business as IP rights are exclusive rights, the management of which is crucial for business growth.
IP Act of Sri Lanka
The legal system of any country is geared towards protecting and rewarding innovation and creations by setting minimum criteria for IP rights. IP rights in many forms are recognised under the Intellectual Property Act No. 36 of 2003 of Sri Lanka (IP Act). Such IP types cover copyright, industrial designs, patents, marks & trade names being the most popular forms of IP.
How to register the Brand?
A brand would speak volumes on the recognition, popularity and quality of products or the standard of service. Brand rights qualify as ‘marks and trade names’ in Part V, Chapter XIX of the Intellectual Property Act No. 36 of 2003 of Sri Lanka. This article attempts at summarizing the current IP regime related to brand protection in Sri Lanka.
First and foremost the brand or the ‘trade mark’ must bear distinctiveness as it is ‘any visible sign serving to distinguish the goods of one enterprise from those of another enterprise’ and as such may consist of a word mark or pictorial/device mark consisting of letters, numbers, labels, emblems, prints, stamps….borders, edgings, combination or arrangement of colour and shapes of goods or colours etc. In other words a distinctive mark guides the consumer to identify the goods/services of the owner from someone else’s.
The preliminary step towards registration of the brand is to search if an identical or similar mark has been applied for or registered with the National Intellectual Property Office of Sri Lanka (NIPO) in Colombo. The proposed applicant may seek the assistance of a registered IP Agent to conduct the search and seek professional guidance towards admissibility of the mark under the current laws avoiding rejection of the mark, as every mark cannot be registered unless it complies with the Act.
An application for registration of the mark must be made to the Director General of NIPO in the prescribed form. An applicant may be a local or foreign individual or enterprise. Each application is based on the ‘NICE Classification’ of goods/services, which allows the applicant to select the applicable classes for its product and/or services related to the actual or potential use of the brand in the market. ‘NICE Classification’ established by the NICE Agreement (1957) is an international classification of goods and services adopted by member states to the NICE Agreement for purposes of registering marks in member states bringing in uniformity indispensable for global trade between member states.
Once the application/s is submitted to the NIPO, a unique number (TM Number) will be assigned and the NIPO examines whether the application complies with the Act. Upon submission, the trade mark application may be either accepted for registration or rejected by the NIPO.
NIPO may refuse an application either based on the mark itself or if concerned with third party rights (such as existing marks in the same class of goods/services). Objections to registration may be raised by NIPO during examination by NIPO or by third parties during the opposition period (3 months from gazetting of the mark by NIPO).
Once the mark is accepted by NIPO, the applicant will be required to pay publication fee to NIPO for the gazetting of the mark. On the lapse of three months from gazetting, if there has been no opposition by a third party, a certificate of registration will be issued to the applicant.
The registered TM can be renewed every 10 years for another term of 10 years indefinitely, thus strengthening the exclusive rights of the owners in relation to their use of the brand in the market.
The whole process of TM registration until certificate stage, may take more than twelve months, as the NIPO claims to have a backlog of applications. It is the author’s considered opinion that the technology could be availed of, by allowing the applicants or registered IP Agents to conduct searches for similar brands at NIPO before lodging the application and thereafter to submit TM applications, track the status until registration and renew the trademark via an online platform.
Rights of Registered TM Owners
The registered owner of a mark has the exclusive right to the use, assign the mark, to grant licenses and to preclude third parties from unauthorized use of the mark as specified by the IP Act. Hence, obtaining registration of the trade mark under the IP Act is an important step towards brand protection, maintenance and commercialization of the IP assets that directly contribute to the success of an organisation.
Rights of Owners of unregistered Brands
The owner of a famous or well-known brand (not registered but has strong evidence of user) can legally stand to prevent others from using an identical or similar mark in connection with identical or similar goods/services that could potentially give rise to confusion in the average consumer. Such a business can take legal action against the infringers by relying on the common law action of ‘passing off’.
Protecting IP Rights overseas
IP rights are territorial in nature, which means that, the brand has to be registered in each country/target market where protection is needed. For example, a brand registered in Sri Lanka will not be accorded the same protection in another country unless the brand is registered in such country as per their IP laws.
Sri Lanka has been exploring the option of adopting the Madrid System which is a centralized system that would allow a Sri Lankan applicant to lodge one application in one language by paying one set of fees to gain brand protection upto 123 countries. It’s indeed a welcoming move that the cabinet has approved a proposal for Sri Lanka to ratify the Madrid Protocol governed by the World Intellectual Property Office (WIPO) and towards this end; the IP Act ought to be amended.
Until such time the IP Act is amended, a potential applicant in Sri Lanka must individually approach lawyers or IP agent in each country and register their brands in the respective territories. Alternatively, a Sri Lankan applicant can lodge an application via the Madrid System by establishing a personal or business connection (either by being domiciled or having a commercial establishment such as an incorporated company) in any such country that is part of the Madrid System (as the ‘Office of Origin’ or Home Trademark Office).
- Thilani Gamage Attorney-at-Law & Notary Public Registered IP Agent (A10459) Founder of Legalite Corporate Consultancy Services (www.legalite.co)