procedure for assignment of trademark in india

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Assignment of Trademark

Updated on : Jun 14th, 2024

Trademark proprietors can transfer trademarks similarly to how they can transfer physical properties. One of the ways to transfer a trademark is through an assignment. Assignment means transferring rights, interests, titles and benefits from one person to another. Assignment of a trademark means to transfer the owner’s right in a trademark to another person.

The transferring party is called the assignor, and the receiving party is called the assignee. Section 2(1)(b) of the Trade Marks Act, 1999 states that assignment means an assignment of a trademark in writing by the act of the concerned parties. Both unregistered and registered trademarks can be assigned with or without the goodwill of the business.

Who can Assign a Trademark?

Section 37 of the Trade Marks Act, 1999 states that the person registered as proprietor of trademark in the register of trademarks has the power to assign a trademark and receive consideration for such assignment. Thus, a trademark proprietor can assign a trademark to another person.

Kinds of Trademark Assignment

The different kinds of trademark assignments are as follows:

Complete Assignment  

The trademark proprietor transfers all rights in the trademark to another person, including the right to earn royalties, to further transfer, etc. 

For example: X is the proprietor of brand ‘ABC’. X assigns his trademark ‘ABC’ completely through an agreement to Y. After this, X will not have any rights with respect to the brand ‘ABC’.

Partial Assignment

The trademark proprietor assigns the trademark to another person with respect to only specific services or goods. The transfer of ownership in the trademark is restricted to specific services or products.

For example: X is the proprietor of a brand ‘ABC’ used for sauces and dairy products. X assigns the rights in the brand ‘ABC’ with respect to only dairy products to Y and retains the rights in the brand  ‘ABC’ with respect to sauces.

Assignment with Goodwill of Business  

The trademark proprietor assigns the rights, entitlements and values associated with a trademark to another person. When the trademark is assigned with goodwill, the assignee can use the trademark for any class of goods or services, including the goods or services which were already in use by the assignor. 

For example: X is the proprietor of ‘Sherry’ brand relating to hair products. X assigns the brand ‘Sherry’ to Y with goodwill. Y will be able to use the brand ‘Sherry’ with respect to food products and any other products they manufacture.

Assignment without the Goodwill of Business  

The trademark proprietor assigns to the assignee rights and entitlements in a trademark with respect to the products or services that are not in use. The assignor restricts the transfer of the rights in the trademark in the case of assignment without goodwill. The assignor assigns with the condition that the assignee is not entitled to use the trademark relating to the goods or services already in use by the assignor.

For example: X is the proprietor of a brand ‘Sherry’ that he uses for manufacturing and selling bags. X assigns the brand ‘Sherry’ without goodwill to Y. Y will be able to use the brand ‘Sherry’ for any other product other than bags.

Pre-Requisites for Assignment of Trademark

• The trademark assignment should be in writing.
• The assignment should be between two identifying parties, i.e. assignor (owner of the trademark) and the assignee (buyer of the trademark).
• The assignor should have the intent and must consent for the trademark assignment.
• The trademark assignment should be for a proper and adequate consideration (amount).

Trademark Assignment Agreement

The proprietor of a trademark generally assigns it to the assignee through a properly executed trademark assignment agreement. The trademark assignment agreement should be drafted keeping the following points in mind:

• The rights of the trademark should not be detrimentally affected due to the obligations contained in the agreement.
• The decision and requirement regarding whether the assignment is with or without the goodwill of the business must be explicitly mentioned.
• The agreement should show a clear purpose of the transaction/assignment.
• The geographical scope of the location where the assignee possesses the values and rights in the trademark must be mentioned.
• The transfer of the right to collect and sue damages for future and past infringements must be mentioned.
• The agreement should be duly executed, i.e. it must be stamped and notarised as per the applicable Stamp Act.
• The signatures and witnesses must be mentioned.
• The place and date of agreement execution must be mentioned.
• The date and day of the assignment along with the parties to the assignment must be mentioned.
• The agreement should mention whether or not it would be binding on the legal heirs of the assignor and assignee.

Process of Assignment of Trademark

The process of assignment of the trademark in India are as follows:

• The proprietor of the trademark (assignor) assigns his/her rights in the trademark through a trademark assignment agreement to the assignee.
• The assignor or assignee, or both, can make a joint request to register the assignment by filing an application of a trademark assignment in Form TM-P to the register of trademarks.
• Form TM-P must be filed with the registrar of the trademark within six months from the date of the assignment. The application can be filed after six months of assignment, but the fee may vary accordingly.
• The assignment must be advertised in such a manner and within the period directed by the registrar of trademarks.
• The copy of the advertisement and the registrar’s direction should be submitted to the office of the registrar of trademarks.
• Upon the receipt of the trademark assignment application (form TM-P) and required documents, the registrar of trademarks will register the assignee as the proprietor of the trademark and record the specifications of the assignment in the register.

Documents Required for Assignment of Trademark

The following documents must be submitted to the registrar of trademark along with form TM-P:

• Trademark assignment agreement.
• Trademark certificate.
• NOC from the assignor.
• Identification documents of the assignor and assignee.

Restrictions on Assignment of Trademark

The Trademarks Act, 1999 provides the following restrictions on trademark assignment:

Parallel Use Restriction  

The assignor cannot assign a trademark when the assignment results in the creation of exclusive rights in different persons with relation to the same or similar products or services and will likely deceive or cause confusion. Thus, multiple exclusive rights relating to the same/similar products or services in different persons are not allowed. It prevents the parallel use of a trademark by more than one person in relation to the same/similar products or services.

Multiple Territorial Use Restriction  

The assignor cannot assign a trademark when the assignment results in the creation of an exclusive right in different persons in various parts of India relating to the same/similar products or services. The assignor cannot assign a trademark when the assignment results in the creation of an exclusive right in different persons in various parts of India relating to the same/similar products or services sold or delivered outside India. Thus, assigning rights in different parts of India relating to the same/similar products or services is not allowed.

Benefits of Trademark Assignment

• The trademark assignment enables the trademark proprietor to encash the value of his/her brand.
• The assignee obtains the rights of an already established brand due to trademark assignment.
• The trademark assignment supports the assignor and the assignee to expand their respective businesses.
• The trademark assignment agreement enables the assignor and the assignee to establish their legal rights in case of any dispute.

Disclaimer: The materials provided herein are solely for information purposes. No attorney-client relationship is created when you access or use the site or the materials. The information presented on this site does not constitute legal or professional advice and should not be relied upon for such purposes or used as a substitute for legal advice from an attorney licensed in your state.

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I am an advocate by profession and have a keen interest in writing. I write articles in various categories, from legal, business, personal finance, and investments to government schemes. I put words in a simplified manner and write easy-to-understand articles. Read more

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Everything You Need to Know About Trademark Transfer in India

Trademark Transfer , often known as Trademark Assignment , is a formal procedure by which a trademark’s ownership and associated rights are passed from the original holder (the assignor) to a new one (the assignee). This process ensures a smooth transition of the brand’s goodwill and exclusive rights, allowing the assignee to step in and take on all the rights and responsibilities that the trademark entails. Understanding the nuances of trademark assignment is crucial for businesses and individuals seeking to protect their brand assets and explore growth opportunities. In this article, we’ll delve into the details of trademark transfer, exploring all the essential information you need to know.

Need help with trademark transfer? Contact IndiaFilings for expert support and a smooth process from start to finish.

What is Trademark Transfer?

When a company registers a trademark , it secures legal protection for its brand elements, such as logos and names, distinguishing its goods or services from others. However, there are instances when a business might need to transfer these trademark rights to another entity, necessitating a process known as Trademark Assignment. This legal procedure involves the transfer of ownership of a registered trademark from the original owner to a new one. In India, this process is meticulously governed by the Trade Marks Act of 1999 and the Trade Marks Rules of 2017, ensuring that such transfers are conducted smoothly and maintaining trademark rights’ integrity within the legal framework.

Note on Trademark Assignment Agreement

The process begins with a Trademark Assignment Agreement, a crucial document that seals the deal between the assignor and assignee. This contract spells out all the transfer details, from the trademark’s specifics to the extent of rights being transferred, along with any particular terms both parties have agreed upon.

Common Instances Leading to Transfer Trademark Ownership  

Common circumstances that necessitate a change in trademark ownership include:

• Death of the Trademark Owner: When a trademark owner passes away, the trademark ownership may need to be transferred to an heir or a legal representative as part of the estate settlement.
• Sale of Business: Selling a business often involves transferring all associated intellectual property, including trademarks, to the new owner to ensure the continuity of the brand.
• Sale of Trademark Alone: A business may choose to sell one or more of its trademarks separately from its other assets, transferring ownership to another entity while retaining the rest of its operations.
• Division of Business: In the event of a business division, trademarks may need to be distributed among the new entities or divisions based on their respective operations and brand usage.
• Change of Name of Owner: If a trademark owner changes their name due to personal reasons such as marriage, or if a company changes its name, the trademark registration needs to be updated to reflect the new ownership identity.
• Change in Form of Business: Transitioning from one business structure to another, such as from a sole proprietorship to a corporation, may require the transfer of trademarks to the newly formed legal entity.
• Compliance with a Court Order: Legal disputes over trademark ownership may result in a court order mandating the transfer of the trademark to comply with a judgment or settlement.
• Purchase of an Existing Business with Goodwill: Acquiring an existing business typically involves transferring all associated goodwill, including trademarks, to maintain the brand’s market presence and customer loyalty.

Advantages of Trademark Transfer in India

The trademark transfer process in India offers many advantages, facilitating strategic business manoeuvres for both the transferring and receiving parties. Key benefits include:

• Legal Transfer of Ownership: The primary advantage is the legal conveyance of the trademark’s ownership, empowering the recipient with the rights to utilize, market, license, or further assign the trademark, ensuring full legal backing in their commercial use.
• Mitigation of Legal Conflicts: Transferring trademark ownership can preemptively resolve or circumvent potential legal disputes stemming from unauthorized trademark usage, safeguarding against litigation and associated costs.
• Facilitation of Business Growth: Trademark transfers are a strategic tool for businesses aiming to penetrate new markets or territories. Acquiring a trademark with an established market presence allows for easier market entry, leveraging the pre-existing brand recognition and consumer trust.
• Enhancement of Brand Equity: Acquiring an established trademark can significantly enhance the brand’s value for the transferee, benefiting from the accrued goodwill and market reputation, thus elevating the brand’s standing and consumer perception.
• Cost Efficiency: Acquiring an existing trademark can substantially save brand development, marketing, and advertising expenses. This cost efficiency allows businesses to allocate resources more effectively towards other critical operational areas.
• Revenue Growth: Securing an established trademark can lead to immediate revenue growth opportunities by tapping into the existing customer base and capitalizing on the brand’s established reputation and market presence.

Types of Trademark Transfer in India

The following are the types of Trademark Assignments in India:

Full Transfer

This type of transfer entails the complete handover of all ownership rights associated with the trademark from the original owner to the new recipient. Consequently, the recipient assumes full ownership and control over the trademark.

Segmental Transfer

In this scenario, only a portion of the trademark’s ownership rights are transferred from the original owner to the recipient. As a result, both the original owner and the new recipient jointly share the ownership and rights of the trademark.

Documents Required for Trademark Transfer

The following documents are required for Trademark Assignment in India:

• Original Trademark Registration Certificate : The authentic certificate provided by the Trademark Registry confirms the registration of the trademark.
• Assignment Agreement: A legally binding Assignment Agreement detailing the transfer of trademark ownership from the seller to the buyer, requiring signatures from both parties.
• Power of Attorney: A legally notarized document granting the appointed trademark attorney the authority to submit the trademark transfer application on behalf of the buyer.
• No Objection Certificate: An official statement from the seller indicating their consent for the trademark ownership transfer.
• Declaration Affidavit: A sworn statement by the buyer asserting the acquisition of the trademark through the assignment and their commitment to adhere to legal usage practices.
• Proof of Identity: A government-issued identification document of the buyer, such as a PAN card or passport.
• Proof of Address: A document verifying the buyer’s address, like an Aadhaar card or a recent utility bill.

Procedure for Trademark Transfer in India

The process for transferring a trademark in India encompasses several systematic steps to ensure a smooth transition of ownership rights:

Due Diligence

Before transferring a trademark, the current owner (assignor) must carefully check (due diligence) to ensure they have the right to transfer the trademark and that there are no legal problems or disagreements. This important step helps protect the future owner’s (assignee’s) rights and guarantees a straightforward transfer.

Negotiation and Agreement

The current and future trademark owners (assignor and assignee, respectively) discuss and agree on the details of the trademark transfer. This includes the trademark, how much it is being transferred, and any special terms or limits they’ve agreed on. These important points are then put into a formal, legally binding document called a Trademark Assignment Agreement.

Creation of Assignment Deed

After finalizing the negotiations, the assignor and the assignee formally sign the Trademark Assignment Agreement. This signed document is the official record of the trademark’s change of hands, detailing the rights, duties, and commitments that each party has agreed to.

Submission of Trademark Transfer Application

With the Assignment Deed finalized and signed by both parties, the next step involves the transferee applying to the Registrar of Trademarks for the transfer. This application uses Form TM-P and must accompany the completed Assignment Deed and the requisite fee.

The Form TM-P is attached here for ready reference:

Review by the Registrar

The Registrar of Trademarks then reviews the submitted application and Assignment Deed to verify compliance with the Trade Marks Act 1999 and the Trade Marks Rules 2017. Should any discrepancies or deficiencies be identified, the Registrar will issue a notice of objection to be addressed by the parties involved.

Advertising the Transfer

Following a satisfactory review, the details of the trademark transfer are published in the Trademark Journal. This publication informs the public and allows for any objections to be raised by third parties.

Addressing Oppositions

A period is allowed following the publication for any opposition to the transfer to be filed. If no objections are raised within this period, typically three months, the Registrar will proceed to issue a certificate of transfer. Conversely, if oppositions are presented, they will be examined, and a resolution will be sought through a formal hearing.

Finalizing the Transfer

Upon resolution of any objections and compliance with all procedural requirements, the Registrar finalizes the transfer, officially recording the transferee as the new owner of the trademark in the trademark register. This final step legally entitles the new owner to all rights and benefits associated with the trademark, completing the transfer process.

Handover of Rights and Duties

By signing the Trademark Assignment Agreement, the original owner (assignor) hands over all the rights and duties of the trademark to the new owner (assignee). This makes the assignee the sole owner of the trademark, with the full authority to use, safeguard, and legally defend it.

Steps After the Transfer

After the trademark is transferred, the new owner (assignee) should promptly update their records and inform their customers, partners, and other important parties about the ownership change. They must also actively protect their new trademark rights, keeping an eye out for unauthorized uses and ready to take legal action if needed.

Following these crucial steps, including adhering to all legal requirements and properly filing the necessary documents, allows for a smooth transition of trademark ownership through the Trademark Assignment process.

In conclusion, transferring a trademark is a pivotal mechanism that enables individuals and businesses to legally pass on trademark ownership rights from one party to another. Governed by the Trade Marks Act, 1999, and the Trade Marks Rules, 2017, in India, this process encompasses several steps, including the creation of an assignment deed, submission of a transfer application, rigorous application review, public announcement in the Trademark Journal, addressing any opposition, and ultimately, the formal registration of the transfer.

Transferring a trademark requires careful consideration and meticulous attention to detail. For expert guidance and seamless assistance throughout your trademark transfer process, contact the professionals at IndiaFilings today.

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All you need to know about Trademark Assignment Process in India

Trademarks are the most prominent way to protect brand identity in this competitive market. However, it also helps in growing your brand and business as a whole. One such way of growing your business is through transfer of trademark ownership in certain situations. Hence, to shed some light on this feature of trademarks, we will discuss the entire trademark assignment process in detail. Moreover, the trademark transfer process also helps in instant monetary benefits along with reduced costs of maintenance of IP rights. So, let’s dive into the process of trademark assignment, documents required and its fees in India. 

What is the Trademark Assignment Process?

Trademark assignment is popularly also the transfer of trademark ownership. The term assignment denotes the transfer of complete or partial transfer of trademark rights from the assignor to the assignee. Moreover, once you learn how to transfer trademark ownership , you can easily start getting the monetary benefits of registering your mark. The trademark assignment process involves a multitude of factors, which we will discuss in this article. 

Also Read: What is Trademark Objection Reply

Types of Assignment to Transfer Trademark Ownership 

The following are the different types of trademark assignment processes in India: 

Complete Assignment

In this type, all titles, rights, and interest in the trademark are also assigned from the assignor to assignee. Here, the assignee becomes the new owner of the trademark. 

Partial Assignment

Many times, for business collaborations, only parts of trademark rights are assigned. When this happens, the trademark assignment process can include limitations of to specific geographical location, goods or services, or a specific duration as well. In this type of trademark assignment process, the whole ownership of a mark is not transferred. 

Assignment with Goodwill

In this type of assignment process, not only the trademark ownership is transferred, but also the goodwill associated with it becomes the assignee’s. 

Assignment without Goodwill

When the goodwill of a mark stays with the previous owner, the process of transfer is “assignment without goodwill”. 

Also Read: Objection under Section 9 of Trademark Act

Essential Features of Trademark Assignment Process

The process of trademark assignment in India must fulfill the following characteristics:

Transfer of Ownership

Whether complete or partial, in transfer of trademark rights, transferring the ownership is a must. 

No Objection of Prior Owner

The assignor should not have any objections with respect to this transfer of trademark ownership. 

Written Agreement

To execute an assignment process in India, the assignor and assignee mandatorily need to enter into a written agreement. 

Consideration 

All trademark assignments happen in exchange for a consideration. Hence, there has to be a monetary consideration that the assignor obtains in exchange of the transfer of ownership. Moreover, providing the proof of this consideration amount also forms an important part of the trademark assignment documents. 

Record 

The transfer of rights must be recorded by the trademark registry. Hence, the parties will have to submit their written assignment deeds in the appropriate trademark form to the registry with the fees for trademark assignment. 

Also Read: Trademark Registration Process in India

Documents Required for Trademark Assignment in India

Below is the list of documents required for the process of trademark rights transfer –

Power of Authority (from Assignor & Assignee)

Both the parties to the process, are required to submit an integral trademark assignment document, ie., power of attorney. The meaning of power of attorney is to authorize the legal professional to act on the parties behalf. This will help the parties in maintaining the terms of assignment deed without any disputes. 

Trademark Assignment Agreement

From the list of all trademark assignment documents, most important is the assignment deed. It is a written contract that makes the transfer of trademark rights enforceable. Moreover, it is also a document that acknowledges the transfer of rights and responsibilities from one person to another. 

This is the only document that clearly shows –

• The change of ownership of a trademark.
• The interest of the parties.
• The rights and obligations of parties.

The assignment agreement is enforceable in India if the parties duly execute it with appropriate stamp duties, notary and signature of the parties.  The parties can keep a copy of the trademark assignment agreement. One has to submit thThe originals are to be submitted to the appropriate trademark registry to give effect to the change of title of the trademark.

No Objection Certificate (executed by the Assignor)

A no-objection certificate encapsulates the assignor’s wish to transfer the trademark ownership. Further, the trademark assignor also agrees that they have no objection to such a transfer of right.

Goodwill Certificate (given by the Assignor)

One needs this document when they are transferring the trademark owner’s goodwill along with the trademark. Basically, a goodwill certificate provides that the assignor has a right to all entitlements related to the qualitative value in a trademark and the assignor is transferring his/ her rights in a trademark to another person. Generally, this document allows the assignee to acquire all entitlements and values associated with the trademark and a right to unconditionally use the trademark for any of the goods and services.

Acceptance of Trademark Rights (provided by the Assignee)

Another important trademark assignment document is a document confirming the consent of the assignee with respect to the rights transferred to him. 

Trademark Assignment Process

You can transfer trademark rights before or after the registration process is complete. Trademark rights can be transferred either before the trademark is registered or once the trademark is successfully registered. You should note that the trademark assignment documents requirement will remain the same in both situations. Hence, for transfer of rights before registration, you should file a request for trademark rights transfer through Form TM – M . Moreover, for trademark assignment after a successful trademark registration, Form TM – P is to be applicable along with the prescribed fee. It is always advisable to seek professional assistance while going for a trademark assignment process in India. Let’s see the step by step process below: 

Identify Parties

The first step to transferring the ownership rights of a trademark is to identify all the parties to assignment. These parties are assignor and assignee. 

Draft the Deed

Then, the parties collectively need to discuss the terms of their agreement and draft it accordingly. 

Record Assignment With Registry

In this step, the parties need to submit the form applicable and pay the requisite fee for trademark assignment. 

Notification From Registry

After submission of the form and details, the parties will receive a notification from the registry. This happens at least 8 to 9 months after the first submission. In this notification, the registry may either approve the assignment, or raise their concerns, if any. Once you resolve this query, the assignment process is complete. 

In conclusion, the trademark assignment process is a simple way of transferring the ownership rights in a trademark from one party to another. This also makes it possible to transfer ownership from an individual to his new company, or from a defunct company to its shareholder. The assignment process makes it easy to manage the wealth of intellectual property rights. Besides, you can always reach out to the Legalwiz.in experts to simplify the process for you! 

Frequently Asked Questions

Yes, a trademark assignment deed must be in writing to make it enforceable. 

In case the registry issues a notice on your assignment request, you can reply to it by submitting a letter in the prescribed format. 

Yes, you can do it through submitting the form TM – M with prescribed fees.

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Rohan Sharma

Rohan Sharma is a lawyer with a flair for writing. Rohan has a special interest in the domain of Intellectual Property Rights and possesses an extensive experience in the fields of trademarks, copyrights and industrial designs. Aiming to understand the intricacies of law as a concept and its symbiosis with advancing technology and changing societies, the author seeks to examine the nuances of law.

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Complete Process of Trademark Assignment in India

In recent years, trademark registration in India has seen a huge boom. During the past 4 years, the number of trademarks registered in India were equal to the past 75 years. Until 2015, India had approximately 11.9 lakh trademarks. While in 2020, registered trademark in India jumped to a humungous 23.52 lakh trademarks, am enormous addition of 11.61 lakhs.

As trademark registrations are rising, trademark transfers/assignments are also on a steady rise. Today, this article will explain the complete process of how to change the owner of a trademark. So, keep reading to understand the trademark transfer process step by step

Do you own a business but not have a trademark? This is what you are missing out on: Take your business to new heights with a trademark

Before understanding the trademark transfer process, let us see what is a trademark?

What is a trademark?

A trademark is a form of intellectual property that provides the trademark complete right to use the registered trademark. Just like physical property, the trademark is also the property of its owner.  Out of the whole bunch of rights that a trademark offers, an important one is the right to transfer the trademark. Every trademark owner has the right to transfer their trademark by trademark licensing or trademark assignment. The Trademark Act, 1999 regulated the process of trademark registration, trademark licensing, and trademark transfer in India.

What is Trademark Assignment or Trademark Transfer?

Trademark assignment means the process by which transfer of ownership and rights of a trademark takes place. According to Section 37 of the Trademark Act, 1999, “the trademark transfer is defined as the transfer of an owner’s right, title, and interest in a trademark or brand mark.

Are you planning to file for a trademark with USPTO ? Read Why does USPTO Reject Trademark Registration?

Types of Trademark Assignment

Here are four ways to transfer a trademark:

After the trademark allotment, it is necessary to record the transfer of possession in the  Trademark registration .

Are you confused about which class your trademark falls in? Learn A to Z of Trademark Classes Here

How do I change the owner of a trademark?

Trademark assignment can take place only after the execution of an agreement known as a Trademark Assignment Agreement . If a partial assignment of a trademark takes place, then the process is known as trademark licensing. If a trademark is registered, then it can be assigned by following the due process:

• First of all, an application for trademark Assignment needs to be made at the Trademark office. Either or both of the Assignor or Assignee can file the trademark transfer application.
• Then submit a TM-P along with the requisite details (Brand Name, Application Number, Class Number Current Status (Active or not), and fee.
• After TM-P form filling, the next step is to submit the documents necessary for the Trademark assignment to the Registrar of the Trademark. Also, the maximum time limit for submission of documents is 6 months starting from the date of acquisition of proprietorship.
• In the next step, the application undergoes processing at the Registrar’s office.
• Next up, the applicant needs to advertise the assignment as suggested by the Registrar. Moreover, you need to submit a copy of the Registrar’s direction along with the assignment advertisement.
• Now, the Registrar approves the assignment application only after he is sure after proper checking. Thereafter, the registrar will register the assignee as the trademark and submit the details of the assignment in the records.

How to Prepare an Assignment Agreement or Application

Under the Trademarks Act, an assignment of a trademark is possible only after an agreement in writing between the parties concerned. Hence, the assignor, as well as the assignee of the trademark, needs to execute a legal document for trademark transfer. Here are some tips for assignment agreement:  

• Mentioning requisite details such as brand name, application number, class number, and the current status is mandatory.
• Delineating legal titles: The agreement’s operative part of the agreement should state that the person transferring the trademark is the lawful owner of it with the right to transfer. Moreover, the agreement should mention that the assignor (himself or his power of attorney holder) has complete right, absolute power, as well as lawful authority to sell or transfer the trademark. 
• Consideration: The consideration portion includes the amount paid by the assignee to the assignor for the transfer. This is because the payment receipt establishes that trademark rights, title and interests have an allowance.

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Trademark Assignment Process in India: A Comprehensive Guide

Transferring ownership of trademarks is a common practice, and it can be done through various methods such as assignment, merger, or amalgamation between entities. In this article, we will focus on the assignment procedure for trademarks in India.

Assignment of Trademarks: Trademark assignment involves the transfer of ownership of a mark from one entity to another. This transfer can occur with or without the goodwill of the business. Let’s explore the two types of assignments:

1. Assignment with Goodwill: This type of assignment involves transferring not only the rights but also the value associated with the trademark as it relates to the products or services being offered. For example, if the owner of the “OFIN” trademark, Ofin Legal Private Limited , assigns the trademark to another entity, the assignee will have the right to use the trademark for the same product.

Forms and Fees: To record the assignment of a pending trademark (with goodwill), you need to submit Form TM-M (Correction of Clerical Error or for Amendment U/R 37) along with an official fee of INR 900 per mark.

For a registered trademark (with goodwill), the appropriate form is Form TM-P (Subsequent Proprietor by way of Assignment or Transfer of Mark), and the official fee is INR 9000 for each assigned mark.

2. Assignment without Goodwill: In this type of assignment, the assignor restricts the use of the trademark by the assignee to specific products or services. The goodwill associated with the owner’s brand for the existing product is not transferred to the buyer. Both the assignor and assignee can use the same trademark but for different goods or services.

Procedure for Filing an Application to Record Assignment without Goodwill: To record an assignment without goodwill, the applicant must submit an application under Form TM-P (Direction of Registrar for Advertisement of Assignment without Goodwill). The official fee for this form is INR 2700. The deadline to submit the assignment is six months from the date of filing. It is also possible to request an extension of three months, as per prescribed forms. The purpose of this application is to request the Registrar to advertise the assignment to the public.

After the assignment has been advertised, the applicant can file the Form TM-M or TM-P (depending on the status of the trademark) along with a copy of Form TM-P (Direction of Registrar for Advertisement of Assignment without Goodwill) and the advertisement notice issued by the Registrar.

Documentary Requirements: To complete the assignment process, certain documents need to be submitted:

• Assignment Deed: A duly stamped and notarized assignment deed is required. The deed should include the effective date, full names and addresses of the assignor and assignee, their signatures, the consideration paid for the assignment, and details of the trademarks being assigned. For applicants outside India, the assignment deed must be notarized in the country of execution and stamped in India.
• Affidavit of No Pending Litigation: The Indian Trade Marks Registry now requires an affidavit confirming that there is no pending litigation and that the ownership of the trademarks is not in dispute. Along with the assignment deed, the assignee should submit a duly stamped and notarized affidavit containing the details of the assignment and the assigned trademark, affirming the ownership status.

If you need further assistance or have any questions regarding trademark assignment, you can reach out to us at [email protected] .

In conclusion, the process of trademark assignment in India involves submitting the appropriate forms, paying the required fees, and providing the necessary documents. It is crucial to comply with the regulations and follow the correct procedures to ensure a smooth and valid assignment of trademark rights.

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Assignment and Transmission of Trademark

• Intellectual Property Rights Blogs Subject-wise Law Notes
• Aishwarya Agrawal
• May 23, 2023

Assignment and transmission of trademarks involve transferring ownership rights from one party to another. The Trademark Act provides guidelines and conditions for such assignments and transmissions, distinguishing between assignments with or without the goodwill and specifying requirements for registration and documentation.

Meaning of Assignment and Transmission of Trademark

Assignment and transmission of a trademark refer to the legal process by which the ownership rights of a trademark are transferred from one person or entity to another. This process involves the transfer of the exclusive rights associated with the trademark, which can include the right to use, license, sell or enforce the trademark.

The assignment of a trademark involves the complete transfer of ownership from one party to another. In this case, the assignee (the party receiving the trademark rights) assumes full control and responsibility over the trademark, including the right to use it exclusively for their own commercial purposes. The assignor (the party transferring the trademark rights) relinquishes all rights and interests in the trademark.

On the other hand, the transmission of a trademark typically refers to the transfer of ownership rights in situations where the original owner passes away or there is a change in the ownership due to legal proceedings, inheritance or other circumstances. Transmission may occur through the distribution of assets in a will, the settlement of an estate or a court order.

Both registered and unregistered trademarks can be assigned or transmitted. A registered trademark is one that has been officially registered with the relevant trademark office, providing the owner with statutory rights and protection. An unregistered trademark refers to a mark that has not been formally registered but may still possess some degree of protection based on common law or other legal principles.

Types of Assignment and Transmission of Trademark

Complete assignment and transmission.

Complete Assignment refers to the transfer of all rights associated with a trademark from one individual to another. This includes the rights to further transfer the trademark, receive royalties and exercise full control over its usage. For instance, if proprietor ‘X’ sells all rights of a trademark to proprietor ‘Y’, ‘Y’ becomes the exclusive owner with the freedom to use the trademark as desired, transfer it to others, set guidelines for its usage and receive royalties. No approval from ‘X’ is required in this case.

Partial Assignment

Partial Assignment involves the transfer of ownership restricted to specific services or products. For example, if proprietor ‘X’ has a trademark (♛) related to men’s lifestyle products but only wants to assign it to shoes, ‘X’ can transfer the trademark to ‘Z’ with the condition that ‘Z’ can only use it for shoes. ‘X’ retains the right to use the trademark for all other products. This type of transfer is known as a partial assignment.

Assignment with Goodwill

Assignment with Goodwill refers to the transfer of a trademark along with all the associated rights and values from one person to another. For instance, if ‘X’ assigns and transfers their trademark (♛) to ‘Z’ with all rights and values intact, ‘Z’ gains full rights to use the trademark for men’s lifestyle products or any other future products they manufacture.

Assignment without Goodwill

Assignment without goodwill involves the transfer of a trademark in a way that allows its use for purposes other than the original one. For example, if ‘X’, who deals with men’s lifestyle products, assigns and transfers their trademark (♛) to ‘Z’ with the condition that ‘Z’ can use it for any product except men’s lifestyle products.

Conditions for assignment and transmission as given in section 42

Section 42 of the Trademark Act outlines the conditions for the assignment and transmission of a trademark, specifically when it is not associated with the goodwill of a business. According to this section, the assignment or transmission of a trademark without goodwill will only be effective if the assignee applies to the registrar for directions regarding the advertisement of the assignment. 

The assignee must advertise the assignment within the timeframe specified by the Registrar, which should not exceed six months from the date of the assignment or an extended period of three months if permitted by the Registrar.

However, if the trademark is assigned along with the goodwill of the business for specific goods and services, it will not be considered an assignment without goodwill. Additionally, if the assignment includes goods for export or services used outside of India along with the assignment of goodwill, it is permissible.

Restrictions on Assignment of Trademarks

The Trademark Act imposes certain restrictions on the assignment and transmission of trademarks to prevent confusion among users or the general public. These restrictions include

• Restriction on assignment or transmission that would create multiple exclusive rights.
• Restriction on assignment or transmission that would create exclusive rights in different parts of India.

Process of Assignment and Transmission of Trademark (Section 45)

The process for the assignment and transmission of a trademark, as described in Section 45 of the Trademark Act, involves the following steps:

• Application to the Registrar of Trademarks using Form TM-P, along with duly certified original documents.
• The Registrar will review the application and provide a decision within three months. The decision may include informing the applicant about the assignment or requesting additional proof if there are doubts.
• If the assignment is approved, the Registrar will make an entry in the Register, including details such as the name and address of the assignee, the date of the assignment, a description of the rights assigned (if applicable), the basis of the assignment and the date of entry in the register.
• In case of a dispute between the parties regarding the validity of the assignment or transmission, the registrar may refuse to register it until the rights of the parties have been determined.

Assignment and Transmission of Registered Trademark (Section 38)

Section 38 of the Trademark Act states that a registered trademark can be assigned and transmitted, with or without the goodwill of the business associated with it. This can apply to all the goods or services covered by the registered trademark or only to a specific subset of goods or services.

Assignment and Transmission of Unregistered Trademarks (Section 39)

According to Section 39 of the Trademark Act, an unregistered trademark can also be assigned or transmitted, with or without the goodwill of the business concerned.

Benefits of Assignment and Transmission of Trademark

Expansion of business: By assigning and transmitting a trademark, the owner can expand their business by using the same trademark in multiple locations simultaneously. Additionally, partial authority can be given to assign the trademark to more than one person.

Leveraging an established brand : Assigning and transmitting a trademark allows the assignee to benefit from an already established brand in the market, saving them the effort and resources required to create a new brand.

Legal proof: The assignment and transmission of a trademark serve as legal proof in case of any disputes related to trademark usage. The rights and liabilities associated with the trademark are clearly outlined in a legal document.

Monetary benefits: The owner of the trademark can enjoy monetary benefits through the assignment and transmission process, including any financial gains resulting from the assignment or transmission. Furthermore, operating with the same trademark in multiple locations can increase the value of the brand.

Structural Waterproofing and ORS v. Amit Gupta ORS [93 (2001) DLT 496]

In this case, a dispute arose regarding the assignment and transmission of a trademark. The court highlighted that the registrar has the authority to refuse the registration of the assignment and transmission until a decision is made by the competent court. The plaintiff claimed ownership of the trademark based on a Memorandum of Understanding (MoU) between the parties. 

However, the court rejected the plaintiff’s request for an injunction against the defendant. The court emphasised that a change in the name of the registered proprietor does not automatically render the trademark unsuitable.

Cinni Foundation v. Raj Kumar Shah and Sons [2009 (41) PTC 320 (Del)]

In this case, the trademark “CINNI” was being used by the owner. A deed of assignment had been executed and signed between the parties. However, it was later discovered that the trademark was not registered. The defendant attempted to claim rights over the trademark. The court ruled that according to the law, the assignee acquires no title to the trademark without the registration of the assignment deed. Consequently, the defendant’s claim to the trademark was dismissed.

These cases illustrate the importance of registration and proper documentation in the assignment and transmission of trademarks. Registration provides legal protection and establishes ownership rights, while adherence to the legal requirements ensures the validity and enforceability of the assignment or transmission of the trademark.

Difference between the Assignment and Transmission of the Trademark

Assignment and transmission are two terms often used interchangeably, but they are distinct concepts according to Section 2 of the Trademark Act. In the case of trademark assignment, there is a transfer of ownership of the registered trademark to another party. On the other hand, in the case of trademark transmission, the original owner retains the rights to the trademark but grants limited rights to a third party for its use.

For instance, let’s consider the example of X, the current owner of the trademark “œ,” who decides to assign the trademark to Y. In this scenario, X relinquishes ownership of the trademark and after a proper assignment process, Y becomes the registered owner with full rights to the trademark.

However, if X chooses to transmit the trademark instead, it means that X remains the original owner of the trademark, but grants limited rights and responsibilities to Y for its use.

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Unlocking brand value: understanding trademark assignment in india.

A Trademark Assignment is a legally binding document that grants permission to the registered proprietor of a trademark to transfer the ownership of the trademark and issue proper receipts for any consideration involved in the assignment. The assignor relinquishes their rights to a registered word, phrase, symbol, or design, transferring it to a new owner. When there is a transfer of the owner’s power, title, and interest in the trademark, this process occurs.

In essence, Assignment and Transmission of Trademark is the procedure by which ownership of a trademark is transferred from one individual to another, entailing either full or partial rights, as specified in the terms and conditions set by the current trademark owner. Both with and without the goodwill of the associated business, registered and unregistered trademarks can be assigned and transmitted from one party to another. This assignment is facilitated through a trademark assignment agreement, which formalizes the transfer of ownership and rights.

In accordance with Section 37 of the Trade Marks Act, 1999, it is explicitly stated that the individual who is registered as the proprietor of a trademark in the register of trademarks holds the authority to assign the trademark to another person and also receive consideration (compensation or payment) for such assignment. Therefore, a trademark proprietor is legally allowed to transfer the ownership of the trademark to a different individual or entity.

Table of Contents

Types of trademark assignment.

The various types of trademark assignments are as follows:

• Complete Assignment: In a complete assignment, the trademark proprietor transfers all rights associated with the trademark to another person. This includes the right to use the trademark for any purpose, the ability to earn royalties from its use, and the right to further transfer the trademark to others. After the complete assignment, the original proprietor no longer retains any rights over the trademark.
• Partial Assignment: In a partial assignment, the trademark proprietor transfers only specific rights related to certain services or goods of the trademark. The transfer of ownership is limited to those particular services or products.
• Assignment with Goodwill of Business: When a trademark is assigned with goodwill, the proprietor transfers not just the trademark itself but also all the associated values, advantages, and reputation linked to that trademark. The assignee can utilize the trademark for any category of goods or services, including those that were already being used by the assignor.
• Assignment without the Goodwill of Business: In an assignment without goodwill, the trademark proprietor transfers rights to the assignee concerning goods or services that are not currently in use. The assignor restricts the transfer of rights regarding goods or services already in use by them. Essentially, the assignee cannot use the trademark for the products or services that were already in use by the assignor.

To initiate the trademark assignment process, follow these steps:

• Submit Application: The first step is to prepare an application for the assignment of the trademark. This application can be made by the assignee (the new owner), the assignor (current proprietor). The application should contain all the necessary details of the transfer under form TM-P, as specified in Rule 75 of Trademark Rules 2017. [1]
• File with Registrar : Once the application is complete, file it with the Registrar of Trademarks. It should be done within 3 months of obtaining proprietorship.
• Registrar’s Direction (for assignments with goodwill or registered trademarks): where the trademark assignment involves goodwill or is of a registered trademark, obtaining a direction from the Registrar of Trademarks is mandatory. It must be obtained before the expiration of the 3-month period (can be extended if needed).
• Advertisement of Assignment: Upon receiving the Registrar’s direction, the applicant must advertise the trademark assignment as specified by the Registrar. It should be done accordingly, and a copy of the advertisement, along with the Registrar’s direction, must be submitted to the authorities.
• Transfer of Trademark: Once the Registrar is satisfied with all the documentation, the trademark will be officially transferred from the original owner to the new owner (assignee).
• Registration of New Proprietor: The name of the assignee, the new owner, will be registered in the trademark register as the new proprietor of the trademark. This formalizes the transfer of ownership.
• Usage of Trademark: the assignee (new owner) can use the trademark as per the terms and conditions specified in the agreement.

Benefits Of Trademark Assignment

• Trademark assignment allows the trademark proprietor to capitalize on the value of their brand.
• The assignee benefits from the trademark assignment by gaining the rights to an already established and recognized brand.
• For both the assignor and the assignee, trademark assignment can facilitate business expansion.
• Through a trademark assignment agreement, both the assignor and the assignee can establish their legal rights and obligations clearly.

Overall, trademark assignment provides a mutually beneficial arrangement for the trademark proprietor and the recipient, allowing them to leverage the value of the brand, expand their businesses, and establish a clear legal framework for the assignment.

Can an unregistered trademark be assigned?

Yes, the assignment of an unregistered trademark can be carried out with or without the goodwill of the business associated with the trademark. To proceed a request must be made on Form TM-16, which is the prescribed form for such assignments.

Can an Individual assign a Trademark?

Certainly, a registered trademark can be assigned by an individual.

Why it’s necessary to obtain a Trademark Assignment Agreement in India?

A Trademark Assignment Agreement serves as a legal mechanism to transfer ownership of a trademark or service mark when required. It plays a pivotal role when a product or company is being bought or sold by another individual or entity.

[1] https://www.ipindia.gov.in/TM-Rules-2017.htm

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Trademark Assignment in India

August 05, 2024 | Intellectual Property The trademark is an essential intellectual property that has acquired a great and significant value and plays a crucial role in brand’s identity building and recognition. It is vital to understanding the intricacies of trademarks and the protection it offers along with how the assignment and transmission processes work, as any error in the process will make you go through the entire process again.

Introduction

What is a trademark, why do you need a trademark, types of trademarks.

• Collective Mark:   This kind of mark is used by associations and organizations to differentiate their services and products from non-members.
• Series Mark:  When a series of products/services having similar resemblance is trademarked by the owner.
• Certification Mark: To certify the origin, quality, material, performance of service, certification mark is used. For example – the Agricultural Mark or commonly called AGMARK being on any product states that it has met the standards governed by the Directorate of Marketing & Inspection.

What is Trademark Assignment?

What is trademark transmission, benefits of trademark assignment.

• It lets the trademark owner to encash the brand value.
• Backs both the assignor and assignee in business expansion.
• Lets the assignor to procure rights of an established company/brand.
• Provides legal backing to both in conflict scenarios.

Trademark Assignment Agreement: Key Clauses

• The geographical location of the assignee holding value and rights should be mentioned.
• It should also explicitly state if it would/would not bind legal heirs of the assignor and assignee.
• Right transfer to sue and collect infringements should be clearly mentioned.
• A clear transaction objective to be mentioned.
• The process should be clear – must be stamped and notarized following the governed standards.
• Witness, signature, date and place of agreement should be mentioned.
• Date and day of the assignment along with the parties involved must be mentioned.

Trademark Assignment Agreement Process

• The trademark owner assigns their rights to the assignee via a trademark assignment agreement.
• Both are liable to extend request to the Registrar through filing a trademark application assignment through FORM TM-P
• The TM-P form should be submitted within 6 months of assignment agreement.
• Assignment should be broadcasted within the specific period mentioned by the Registrar.
• Advertisement copy and Registrar guidelines are to be submitted to Registrar post completion.
• The necessary documents and advertisement copy and guidelines issued post receipt of FORM TM-P, will be acknowledged by the Registrar by registering the assignee and new proprietor of the assignment agreement

Documents Required for Trademark Assignment

• Trademark certificate,
• Trademark assignment agreement,
• NOC from the trademark assignor,
• Identification documents of assignor and assignee.
• Definition of Resolution plan will now include provisions for corporate restructuring: The amendment act has inserted an explanation in the definition of resolution plan to clarify that a resolution plan that proposes the insolvency resolution of a corporate debtor may include the provisions for corporate restructuring, including by way of merger, amalgamation and demerger.
• NCLT will have to record reasons for delay in discarding an application for initiation of CIRP: As per the Code, the NCLT must dispose of an application for initiation of CIRP within a period of 14 days from the receipt of application. However, there have been cases when the NCLT has taken more than 14 days to make a decision on the application. Therefore, to ensure speedy disposal and value maximization of the corporate debtor's assets, a proviso has been added which requires that NCLT to record its reasons in writing in case an application is not disposed within 14 days.
• Corporate Insolvency Resolution Process to be concluded within 330 days: Earlier, the IBC demanded completion of CIRP within 180 days including a one-time extension of 90 days. However, many a times the Courts have allowed removal of certain periods, for instance, time consumed in litigation, from the compulsory completion period resulting in a lot of unresolved CIRPs well beyond the time duration allowed in the IBC. The Amendment act makes it compulsory for a CIRP to be completed within 330 days including any extension of time granted and time taken under legal proceedings. It further states that any pending CIRPs that have been going on for over 330 days should be completed within 90 days from the date of commencement of the Amendment Act.
• Voting by authorised representative representing a class of financial creditors: To avoid any confusion and facilitate decision making in the Committee of Creditors, especially in cases where financial creditors are a large group, the Amendment Act provides that an authorized representative representing a class of financial creditors shall vote on behalf of all the financial creditors he/she represents in accordance with the decision approved by more than 50% of such financial creditors. This principle however would not be applicable in case of voting for withdrawal of CIRP.
• Amount payable to functional creditors and disagreeing financial creditors: The Amendment Act provides that payment of debts of operational creditors shall be the higher of
• the amount to be paid to these creditors at the time of liquidation of the corporate debtor u/s 53 or
• the amount that would have been paid to such creditors, if the amount to be distributed under the resolution plan had been distributed in accordance of priority as mentioned u/s 53 (1)
• NCLT has not approved or rejected a resolution plan
• an appeal is pending at the Supreme Court or at the NCLAT (National Company Law Appellate Tribunal)
• a lawsuit has been launched in a court challenging the decision of NCLT in relation to a resolution plan
• Committee of Creditors (COC) to contemplate way of distribution submitted in the resolution plan: Besides the current need of approval of resolution plan after keeping in mind the practicality and acceptability of the resolution plan, the amendment act requires that the CoC consider the manner of distribution proposed in the resolution plan by taking into account the order of priority amongst creditors, as prescribed u/s 53 (1) relating to liquidation waterfall, including the priority and value of security interest of a secured creditor.
• NCLT approved resolution plan will be binding on the Central Government, State Government or any local authority to whom corporate debtor owes a statutory debt: As per the Code, the approved resolution plan was only binding on the corporate debtor and its employees, creditors, members, guarantors and other stakeholders included in the resolution plan resulting in instances where the Government used to follow up for the balance dues after the said approval of resolution plan. The Amendment Act has now modified Section 31(1) to illuminate that any NCLT approved resolution plan will be binding on the Central Government, State Government and any local authority to whom a corporate debtor owes a debt in respect of payment of dues arising under any law.
• Liquidation after setting up the Committee of Creditors (COC): The Amendment Act simplifies by way of an explanation, u/s 33(2) which covers liquidation, that the COC may decide to liquidate the corporate debtor any time after the setting-up of the COC until the confirmation of the resolution plan, including at any time before the development of the information memorandum. This change is pertinent as there have been cases where NCLTs have demanded that a liquidation order may be passed only after failure of the CIRP even though an early liquidation would have resulted in value maximization.

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A trademark is intellectual property, and the owner has the same rights as other types of assets, such as the ability to sell, license, or transfer their intellectual property. Trademark licensing and assignment are covered by the Trademark Act of 1999. A trademark transfer or allocation is the process of legally transferring the trademark title from the primary owner, also known as the assignor, to the recipient, also known as the assignee. The assignor, like any other owner of property or assets, has the right to sell, license, or transfer the trademark. Trademarks can be transferred using the Trademark Assignment Agreement or Trademark Licensing. The process of changing registered trademark ownership is referred to as the trademark assignment.

HOW DOES TRADEMARK ASSIGNMENT TAKE PLACE

To transfer ownership of a registered trademark to a third party, the assignor must first create and file a Trademark Assignment Agreement with the appropriate authorities. Before the assignment process can begin, the agreement must be submitted. However, this does not preclude a third party from using a registered trademark of a well-known company. When a trademark is assigned, ownership of the registered brand changes. When a trademark is granted a license, the original owner retains ownership and only a limited set of rights are granted to the third party. The business goodwill may or may not be transferred as part of this assignment. The assignment must be recorded in the trademark register if the trademark is registered. A trademark can be transferred between two people through deeds, agreements, and so on. It is usually a one-time payment. An assignment deed is a common name for such trademark assignment/ agreement. In both cases, whether registered or unregistered, the assignee must apply to the Registrar within six months.

DIFFERENT TYPES OF TRADEMARK ASSIGNMENT

In India, various types of Trademark Assignment are accepted. The parties would be classified according to their needs and requirements, and the Trademark Assignment agreement would be drafted accordingly. The following are the various types of trademark assignments in India:

Complete Assignment: As a result of this assignment, the assignee becomes the sole owner of the trademark, and the assignor loses all ownership interests in it. In other words, the assignor transfers the assignee's entire ownership of the registered trademark to the assignee.

Specific or Partial Assignment: A specific assignment occurs when the agreement only grants certain unique rights to use the trademark. A partial assignment occurs when the agreement only grants certain unique rights to use the trademark. In other words, the assignor simply transfers a portion of ownership of specific goods and services.

Assignment of trademark with goodwill: In an "assignment with Goodwill," the assignor transfers both the rights to the trademark and its value or goodwill to the assignee. The goodwill figure will be calculated individually in the agreement.

For example, suppose Mr. X owns a trademark "TM" and is already using it in relation to clothing and footwear. Mr. X assigns the said trademark "TM" to Mr. Y via an agreement (in writing) in relation to clothing and footwear, as well as the Goodwill associated with the trademark "TM".

In this case, Mr. X has also assigned to Mr. Y the Goodwill associated with the trademark "TM" for the clothing and footwear business, as well as for other goods or services. As a result, Mr. Y is authorised to use the trademark "TM" for clothing and footwear, as well as other goods or services.

Assignment of trademark without goodwill: A gross agreement occurs when only the ownership or rights are transferred while the assignor retains the goodwill. The assignor will limit the buyer's rights while transferring the trademark in this type of trademark assignment. In this case, the assignor prohibits the purchaser from using the product's brand, which the assignor already owns; in other words, the goodwill associated with the brand is not transferred to the assignee.

For example, suppose Mr. X owns a trademark "TM" and is already using it in relation to clothing and footwear. Mr. X assigns the said trademark "TM" to Mr. Y through a written agreement in relation to goods or services other than clothing and footwear without assigning the Goodwill associated with the trademark "TM".

In this case, Mr. X has not assigned to Mr. Y the Goodwill associated with the trademark "TM" for the clothing and footwear business. As a result, Mr. Y is ineligible to use the aforementioned trademark "TM" for clothing and footwear. As a result, if Mr. Y wishes to use the said trademark "TM" in relation to other goods or services, he must create separate Goodwill for trademark "TM" for such other goods or services.

Documents Required for Trademark Assignment

The following documents are necessary for Trademark Assignment Procedure in India:

• Certificate of Trademark registration
• Particulars (Identity and address proof) of the assignor and assignee
• NOC from the original owner of the registered trademark
• Description of trademark assignment with or without goodwill
• Copy of advertisement along with a Registrar’s direction
• Signatories of Trademarks and Witness
• Notarization / Oath Commissioner
• Proof of Execution date and place
• Power of Attorney/ Authorisation Letter
• Any other documents as may be required

Legal Procedures of Trademark Assignment

• The first step in the trademark assignment procedure is to file an application for the assignment, either by the assignee or by the assignor, or both.
• The application for such a process should include all transfer details in form TM-P.
• Following the completion of the application, it must be filed with the Trademark Registrar.
• This must be completed within 6 months of acquiring the proprietorship.
• The Registrar must specify the manner in which the trademark assignment will be advertised.
• A copy of the trademark assignment advertisement, as well as a copy of the Registrar's direction on it, should be submitted.

Features & Benefits of Trademark Assignment

Valuation of Trademark: When a brand is created, it takes a lot of money, time, and effort. Thus, through the process of assigning a trademark to a third party, the owners or authors of the trademark can receive the value of the trademark in cash.

Trademark Assignment Agreement is a valid proof: In the event of a situation or dispute involving the assignment of a trademark, a trademark assignment agreement can serve as valid proof or evidence. Such assignment agreements effectively protect the author's or trademark owner's legal rights.

Already established brand: The author of a trademark benefits from dealing with an already existing trademark.

Monetization Of Brand: Monetize the value of your trademark and reap the benefits of your time and investment in developing the brand.

Easy Brand Building: The assignee benefits as well because he or she does not have to work on brand building.

Protection of Intellectual Property: Trademark assignment aids in the preservation of intellectual property by preserving registrations of the same.

Frequently Asked Questions

Is it possible to assign an unregistered trademark.

An unregistered trademark assignment can be made with or without the business's goodwill. A request for the assignment of an unregistered trademark must be made on Form TM-16.

Why is a Trademark Assignment Agreement required in India?

It is a legal means of transferring ownership of a trademark or service mark when necessary. When a product or company is sold or purchased by another person or company, a trademark assignment is required.

Is the licensing of trademark assignment required?

The assignment is licensed on a voluntary basis. However, it is recommended that the trademark be licensed because it has many advantages and serves as valid proof of the assignment.

Can a trademark be assigned without the transfer of goodwill?

Yes, a trademark can be assigned with or without the business's goodwill.

What are the Basic Elements of an Indian Trademark Assignment Agreement?

The following are the basic elements of a Trademark Assignment Agreement in India: Effective Date; Trademark Details; Assignor; Assignee; Warranties; Consideration; Signatures; and Notary Public.

How can Compliance Calendar LLP assist in the Trademark Assignment?

We have a team of Trademark Agents/ Attorneys who will first have a discovery call with you to understand your requirement of trademark assignments and accordingly will help you right from the drafting and vetting of trademark assignment deed to filing with the Dept. If you have any questions, you may reach out at [email protected] or connect at 9988424211.

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Trademark Assignment

Trademark assignment is defined as the part of transfer of ownership of a trademark from one party to another. Trademark Assignment happens whenever the ownership rights of such trademark or brand, is transferred from one owner or party to another person. This can be done be with or without the goodwill of the business.

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How to Start a Trademark Assignment

Trademark Licensing

• Types of Trademark Assignment
• Requirements

Process for a Trademark Assignment

• Restriction on Assignment of Trademark
• Who Can Register Trademark Assignment

Benefits of Trademark Assignment

Why legaltax.

A trademark is simply the name of your business. Trademark is involved in the name of the business itself, a logo or a “combined mark” that covers both your business name and the logo related to that. Like any other property or asset, the owner of the trademark (the assignor) has the right to sell, license or transfer the same. The transfer of trademark is possible thorugh the Trademark Assignment Agreement or Trademark Licensing. The current article basically explains the term trademark assignment along with its advantage, types of trademark assignment, pre-requisites and procedure of trademark assignment.

Trademark is an intellectual property and like any other asset, the proprietor of a trademarks has the authority or power to sell, license or transfer the owned intellectual property. Such transfer can be made through Trademark Assignment or through licensing. Whenever a trademark is assigned, there is some sort of variation in the ownership of the registered brand. But when it is licensed, the benefits related to the trademark continue to vest with the buyer but only a few qualified rights are given to the third party. This assignment can be done with or without assigning the goodwill of business. In case of a registered trademark, such as assignment is required to be recorded in the Register of a trademark. Some of the advantages of the trademark assignment (concerning both the owner and the buyer) are listed hereunder-

The trademark assignment enables the owner of the trademark to en cash the value of his brand.

With the help of a trademark assignment, the assignee can obtain the rights of an already established brand.

The assignment of the trademark supports both the assignor and the assignee to expand their respective business.

In case of any dispute, the trademark assignment agreement would enable the assignor or the assignee to establish the legal right.

The licensing of a mark is to allow others to use the mark without assigning the ownership and the same may be done for all or some of the goods and services covered. The Trademarks Act does not mention the term 'License', the concept under the Act is mentioned as that of a 'Registered User'. Trademark licensing is advantageous to both the parties. While the licensor enjoys its rights to the mark by getting the royalties for its use, the licensee is able to expand its market operations by using the brand and developing its reputation. In case of Licensing, the licensor is open to license the rights over the trademark in manner it may like. The Licensor can restrict the rights of the licensee in a trademark or brand with respect to the products or services wherein the licensee can use such brand, with respect to time for which it can use such mark, with respect to area within which it can use such mark etc.

Statutory Definition of Trademark Assignment:

Section 2(1)(b) of the Trade Marks Act, 1999 “Assignment” means an assignment in writing by the act of the parties concerned;

Who Can Assign a Trademark?

As per section 37 of the Trade Marks Act, 1999, the person entered in the register of trademarks, as the proprietor of a trademark, shall have power to assign a trade mark and to give effectual receipt of for any consideration for such assignment.

Assignability of Registered or Unregistered Trademark:-

As per section 38 of the Act, a registered trademark can be transferred with or without the Goodwill of the business concerned either in respect of all the goods or services in respect of which the said trademark is registered or of some of the goods or service. Moreover, as per section 39 of the Act, an unregistered trademark may be assigned with or without the Goodwill of the business concerned.

Types of Trademark Assignment:

There are four types of trademark assignments-

Partial assignment,

Complete assignment,

An assignment with Goodwill, and

An assignment without Goodwill / Gross assignment.

All the four types of trademark assignments are briefly explained here as follows-

1. Partial assignment: Under the partial assignment, the assignor transfers only limited ownership with regard to specific products/ services.

2. Complete assignment: Under the complete assignment, entire rights with respect to the registered trademark are transferred by the assignor to the assignee.

3. An assignment with Goodwill: Where an assignor assigns to the assignee, the value, rights and entitlements also, as associated with a trademark with respect to the goods or services already in use by the assignor. After taking over the goodwill associated with the trademark, the assignee is free to use the trademark assigned to him for all goods or services including for the goods or services which were already in use by the Assignor. Such assignment is called assignment with Goodwill of Business. For Example: Mr. A is the owner of a trademark “TM” who is already using the said trademark “TM” in relation to clothing and footwear. Mr. A assign to Mr. B the said trademark “TM” through an agreement (in writing) in relation to clothing and footwear along with the Goodwill associated with trademark “TM”. In this case, Mr. A has also assigned to Mr. B, the Goodwill associated with trademark “TM” for the business of clothing and footwear as well as for other goods or services. Therefore, Mr. B is eligible to use the said trademark “TM”, for clothing and footwear including other goods or service dealt by Mr. B.

4. Gross assignment or Assignment without Goodwill: assignment, while transferring the trademark, the assignor will restrict the buyer’s right. The assignor here restricts the buyer from using a brand of the product which is already being used by the assignor. In nut-shell, the goodwill attached to the brand is not transferred to the assignee. Where an assignor assigns to the assignee, the right and entitlements in a trademark with respect to the goods or services which are not in use by the assignor. In other words, where the assignor restricts the assignee with a condition that the assignee is not entitled to use the trademark assigned in relation to the goods or services already in use by the assignor. Such assignment is called assignment without the Goodwill of Business. For Example: Mr. A is the owner of a trademark “TM” who is already using the said trademark “TM” in relation to clothing and footwear. Mr. A assign to Mr. B the said trademark “TM” through an agreement (in writing) in relation to goods or services other than clothing and footwear without assigning the Goodwill associated with trademark “TM”. In this case, Mr. X has not assigned to Mr. B, the Goodwill associated with trademark “TM” for the business of clothing and footwear. Therefore, Mr. B is not eligible to use the said trademark “TM”, for clothing and footwear. Thus, in case, Mr. B wishes to use the said trademark “TM” in relation to other goods or services then he will be required to create separate Goodwill for trademark “TM” for such other goods or services dealt by him.

Requirements/ Checklist for Assigning Trademark

Assets to be assigned

Pending trademark applications.

Issued trademark registrations.

Associated marks, applications or registrations.

International registrations.

Common law trademarks.

Names of living or deceased individuals.

Domain names, email accounts, social media or website accounts, etc.

Execution requirements

Signatories.

Notarization.

Legalization.

Execution date and place.

Power of attorney.

The process of assignment of trademark happens when assign or transfer of intellectual property rights to another person is done with or without goodwill. Assignee, he is the person who becomes qualifies by the assignment of certified trademark, he or she should apply for the trademark assignment in the designated manner. The various steps should be followed for the completion of the process of Trademark assignment. The steps are as follows;

An application of a trademark assignment shall be made in Form ™-P by the assignor or assignee or both can make a joint request to register assignee as a subsequent proprietor.

Apply with the registrar of a trademark within six months from the date of procurement of the proprietorship. The application can be filed later, but the requisite fee may vary accordingly.

In case of assignment without goodwill or assignment of a certified trademark, the regulation from the registrar of trademarks is needed before the expiry of six months from the date on which assignment is delivered or within the extended long period which is provided by the registrar.

Advertise the assignment in such a manner and within such a period as the registrar may direct.

A copy of the direction of the registrar and advertisement of the assignment must be submitted to the office to make sure that the directions have been followed accordingly or not.

On the receipt of the trademark assignment application and documents required, the registrar after perceiving satisfied shall register the assignee as the proprietor of the trademark and the specifications of the assignment to be recorded in the register.

Restriction on Assignment of Trademark:-

1. Parallel use Restriction: Where assignment results in creation of exclusive right in different persons, in relation to same or similar goods or services and the use of the trademark will be likely to deceive or cause confusion. Thus, multiple exclusive right in relation to same or similar goods or services, in different person is not allowed. This prevents the parallel use of a trademark by more than one person concerned in relation to same or similar goods or services. (Section-40)

2. Multiple Territorial use Restriction: Where the assignment results in creation of exclusive right, in different person in different parts of India, in relation to same or similar goods or services. Thus, assigning of scattered right in different parts of India is not allowed. (Section-41)

Who Can Register Trademark Assignment?

Under section 45, A person (subsequent proprietor) who became entitled by the way of assignment, shall apply for registration of assignment before the Registrar of trademarks.

The Registrar shall enter the details of the assignee (subsequent proprietor) as the proprietor of the trademark assigned to him in respect of goods or services for which the assignment has been made, after due satisfaction of the Registrar of trademarks, (under section 45).

Under section 45, whenever the validity of assignments is in dispute between the parties, the Registrar may refuse to register the assignment until the rights of the parties are determined by the competent court.

Under rule 76 of Trade Marks Rules, 2017, Registrar of trademark shall dispose of the application for registration of assignment of trademark within a period of three months from the date of receipt of application.

Under rule 77 of Trademark Rules, 2017, Registrar may, where there is reasonable doubt about the veracity of any statement or any document furnished, may call upon any person who has applied to be registered as proprietor of a registered trademark furnish such proof or additional proof of title as the Registrar may think fit.

As per Chapter IV of the Indian Stamp Act, 1899. (rule 78 of Trade Marks Rules, 2017), whenever in the opinion of the Registrar any document produced in proof of title of a person is not properly or sufficiently stamped, the Registrar shall impound and deal with it.

Where the Registrar has allowed the registration of assignment, then there shall be entered in the register the particulars as follows(rule 84 of Trade Marks Rules, 2017):-

Name and address of the assignee;

Date of assignment;

Where the assignment is in respect of any right in the trademark, a description of the right assigned;

Basis under which the assignment is made; and

Date on which the entry is made in the register.

Right of the Assignor on Assignment of Trademark:

The assignor terminates to have his rights, title or any interest in the trademark, the moment assignment deed is executed in favor of the assignee, irrespective of the fact that the name of the assignee has not been updated in the record of the Registrar of trademarks. In the matter of Classic Equipments Pvt. Ltd. vs. Johnson Enterprises, 2009 (41) PTC 385 (Del), it was observed as follows:

Rights of the Assignee: When Assignment Is Complete but Registration Is Pending:

Though as per section 45 of the Act, it is mandated that the assignee shall apply before the Registrar of the trademarks to register his title. But this does not mean that recording of assignment of registered trademark asserts all rights or titles or interest in the assignee. The reason behind this understanding are the opening words of section 45 of the Act, which says “where a person becomes entitled by assignment or transmission of a registered trademark, ……..”. Therefore, the first condition is entitlement of rights, title or interest by way of assignment or transmission of a registered trademark followed by registration of assignment of a registered trademark. Thus right in assignee does exist even before the registration of assignment. In the matter of M/S. Modi Threads Limited vs M/S. Som Soot Gola Factory And…. on 4th December, 1990: AIR 1992 Delhi 4, 1992 (22) DRJ 24 was observed as follows: “It is true that the plaintiffs application for getting transferred the registered trade mark in its name in the office of the Registrar is still pending but that does not debar the plaintiff to protect the violation of the aforesaid trade mark at the hands of unscrupulous persons by filing an action in court of law for injunction. It is, prima facie, clear to me that during the interregnum period when the application of the plaintiff is kept pending for consideration by the Registrar of Trade Marks the dishonest persons cannot be allowed to make use of the said trade mark in order to get themselves illegally enriched earning upon the reputation built up qua that trade mark by the predecessor-in-interest of the plaintiff.”

The assignee of a trademark is also entitled to file a civil suit, even though the recording of assignment of registered trademark is pending before the registrar of trademarks. Moreover, section 45 does not confer any title over the trademark assigned. Instead the registration granted under section 45 is only proof of title of the trademark of assignee or the person who acquired it by way of assignment.

Forms and Fees

In order to record an assignment, an application of a registered trademark can be made through the following Forms:

Trademarks which are pending:

Form TM-M is required to be filed by the applicant. Fee Required- INR 900 for each mark.

Trademarks which are registered:

Form TM-P is required to be filed by the applicant. Fee required for filing of such Trademark is INR 9000 for each mark to be assigned.

Unlock Value: Through an assignment agreement, the brand owner can unlock the value of the brand owner and can unlock the value of the brand, which, until this point, only has value on paper. The assignee, on the other hand, could be significantly better off beginning a market with a previously well-known brand, rather than developing a new one entirely.

Valid proof: In case of a dispute associated with the trademark, legal rights would quickly be established through the action. The Registrar assures that all the checks are in place by testing the validity of all the clauses in the agreement and declaring the assignment in the Trade Marks Journal.

Legal Assistance: We execute legal work for over 1000 companies and LLPs every month, by leveraging our tech capabilities and the expertise of our team of legal professionals. Come on board and experience the ease and convenience. Realistic Expectations: By handling all the paperwork, we ensure a seamless interactive process with the government. We provide clarity on the incorporation process to set realistic expectations. Team: With a team of experienced business advisors and legal professionals, you are just a phone call away from the best in legal services.

Conclusion of the Article

Assignment and Licensing of brands are considerable issues and proper strategizing may open vistas of opportunities for all, a licensor, a licensee, an assignor and an assignee. Both concepts involve a degree of planning for the future of the parties involved and the brand in question. The development of a brand, its propagation and its use, all lie in the hands of the proprietor of the brand and trademark and assignment and licensing are effective methods to manage the same. Assignment of trademarks allows the Proprietor thereof to en-cash their intellect, efforts, time and money. It is equally important to register the assignment of trademark, since on registration the details of the assignee are updated in the register of trademark, this serves as a notice to public at large. Moreover, preparation of assignment agreements is also important as it involves rights, entitlements, interests and obligation including the commercial terms between the assignor and the assignee.

Disclaimer: The entire content of this document has been prepared as per the relevant provisions of the Act and rules made there under, applicable at the time of preparation. Though proper care has been taken to ensure accuracy, completeness and reliability of the information provided therein. The users and readers agree that the information provided in this document is not professional advice. Therefore, we assume no responsibility there from. Further, this write up shall not be considered as solicitation in any manner.

Q1. Give an overview of Trademark Assignment

Q2. what is trademark assignment, q3. what is the process of trademark assignment, q4. what are the benefits of trademark assignment, q5. why to choose legaltax over any other organization, q6. what is trademark sale, q7. can an unregistered trademark be assigned.

At the time of the assignment, it is used in the same business as a registered trademark;

That both the certified and unregistered trademarks are assigned at the identical time and to the same person;

and That the goods regarding which the assignment is effected are the same for both the registered and unregistered marks.

Q8. Is it mandatory to notarized Trademark Assignment?

Q9. can you assign goodwill, q10. when does the trademark assignment happen, q11. is it possible to do trademark assignment with goodwill, q12. is it compulsory to record the assignment of trademark with the trademark registry, q13.how can we assign our trademark, q14. how can we know that something is trademarked, q15. what are the types of trademark assignment agreement, q16. what are the basic elements of trademark assignment agreement in india, q17. when should i apply to the registrar for the assignment of trademark in india, q18. what are the forms and fees related to trademark assignment, q19. who can register trademark assignment.

2. The Registrar shall enter the details of the assignee (subsequent proprietor) as the proprietor of the trademark assigned to him in respect of goods or services for which the assignment has been made, after due satisfaction of the Registrar of trademarks, (under section 45).

Q20. What are the Requirements and Checklist for assigning Trademark?

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Assignment of trademarks in India

Trademarks like any asset can be transferred from one owner to another. The transfers could be temporary through licensing or permanent through an assignment. Assignment of a trademark is a process in which the owner of the trademark transfers the ownership of the mark either with or without the goodwill of the business. In other words, it is transferring of proprietary rights in the property of the proprietor. The manner in which an assignment can be made are as follows:

• Complete assignment;

In a complete assignment, the owner of the trademark transfers all the rights with respect to the trademark, including the transfer of the rights such as right to further transfer, earn royalties, etc., to another entity.

For example, A, owner of “xyz”, sells his brand to another through an agreement to B. After this, A does not retain any rights with respect to “xyz”.

• Partial assignment;

In a partial assignment, the transfer of ownership is restricted to specific product or service only. The owner may retain the right to further transfer, to earn royalties etc.

For example, A, owner of a tea and a biscuit brand, transfers proprietary rights only with respect to the tea brand and retains the rights over the biscuit brand, this is said to be a partial assignment.

• Assignment with goodwill;

This is an assignment where the owner transfers the rights and value of the trademark as associated with the product it sells;

For example, A, owner of “TH” trademark for manufacturing and selling of watches, can assign the trademark along with giving the assignee the right to use the said trademark for the same product.

• Assignment without goodwill;

This is an assignment where the owner restricts the assignee to use trademark for the products he uses it for. That is, the goodwill attached to the owner’s brand with respect to the product already being sold under such brand, is not transferred to the buyer. This means that assignor & assignee both can use the same trademark but in dissimilar goods or services.

For example, if the owner of the trademark “TH” uses it for manufacturing and selling of watches and decides to assign it without goodwill, it means that the assignee can use the trademark “TH” for any other product other than watches.

Once a trademark is assigned it is important to record the change in ownership with the Trademark Registry. Specific forms with fees have to filed to ensure that the records reflect the ownership details.

Click here to view image.

Procedure to record the assignment with the Registry :

Assignment of an unregistered mark:

Section 39 stipulates that an unregistered trade mark may be assigned or transmitted with or without the goodwill of the business concerned. A request has to be made on Form TM-16 for an unregistered trademark to be assigned or transferred.

Assignment of a registered trademark:

Section 38 stipulates that trade Marks can be either assigned in full or transmitted in part, with or without the goodwill of the business. All transmissions or assignments must be registered with the Registrar of Trade Marks on Form 23 or 24 of the Trade Marks. (Rule 68 of the Trademarks rule, 2002).

In a case of assignment or transfer of a single trade mark:

• if made within six months from the date of acquisition of proprietorship, then the official fee is Rs. 5000;
• if made after expiration of six months but before 12 months from the date of acquisition of proprietorship, then the official fee is Rs. 7,500;
• if made after 12 months from date of acquisition of proprietorship, then the official fee is Rs. 10,000.

In case of assignment of more than one trademark:

• if made within six months from the date of acquisition of proprietorship, then the official fee is Rs. 5000 for the first mark and Rs. 1000 for every additional mark;
• if made after expiration of six months but before 12 months from the date of acquisition of proprietorship, then the official fee is Rs. 7,500 for the first mark and Rs. 1500 for every additional mark;
• if made after 12 months from date of acquisition of proprietorship, then the official fee is Rs. 10,000 for the first mark and Rs. 2000 for every additional mark.

From a practical perspective , this is what you need to incorporate in any assignment deed which involves trademarks;

• The assignment deed must be in writing where the assignor’s name must be same as it is in the Register of Trademarks, i.e. the owner of the trademark;
• It is absolutely necessary that the territorial extent of the assignment is clearly laid down; for example, if the assignee is based in India, then it is a must that the assignment deed contain a clause saying the assignment is for that particular region;
• The next obvious thing is, the mark/marks that the proprietor wants to assign must be mentioned clearly;
• The consideration that the assignee needs to pay should be mentioned as well; the standard phrase of “good and valuable consideration” wouldn’t hold good; The stamp duty has to be calculated on the basis of the consideration.
• The effective date of the assignment must be laid down clearly;
• The most important part of an assignment deed is to mention if the assignment is along with the goodwill or not.

As can be noted, transfer of proprietary rights in trademark is similar to transfer of any other asset; Trademarks are valuable assets since they quantify a company’s reputation and goodwill. While making sure the assignment is in order you also have to keep the records of the trademark registry updated with these changes.

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Assignment of Trademark

GENERAL UNDERSTANDING:

As physical properties are transferred, the same way trademarks are also transferred. This transfer of trademark is called Assignment of trademark. In general terms, Assignment means transfer of title, rights, interest and benefits from one person to another person.

Thus, Assignment of trademark means transfer of Owner’s title, rights, interest and benefits to other person. The transferring party is called as “Assignor” and the receiving party is called as “Assignee”.

STATUTORY DEFINITION:

Section 2(1)(b) of the Trade Marks Act, 1999 “Assignment” means an assignment in writing by the act of the parties concerned;

WHO CAN ASSIGN A TRADEMARK:

As per section 37 of the Trade Marks Act, 1999, the person entered in the register of trademarks, as the proprietor of a trademark, shall have power to assign a trade mark and to give effectual receipt of for any consideration for such assignment.

ASSIGNABILITY OF REGISTERED OR UNREGISTERED TRADEMARK:-

As per section 38 of the Act, a registered trademark can be transferred with or without the Goodwill of the business concerned either in respect of all the goods or services in respect of which the said trademark is registered or of some of the goods or service.

Moreover, as per section 39 of the Act, an unregistered trademark may be assigned with or without the Goodwill of the business concerned.

  TYPES OF ASSIGNMENT:-

1. Assignment with Goodwill of Business: Where an assignor assigns to the assignee, the value, rights and entitlements also, as associated with a trademark with respect to the goods or services already in use by the assignor. After taking over the goodwill associated with the trademark, the assignee is free to use the trademark assigned to him for all goods or services including for the goods or services which were already in use by the Assignor. Such assignment is called assignment with Goodwill of Business.

For Example: Mr. X is the owner of a trademark “TM” who is already using the said trademark “TM” in relation to clothing and footwear. Mr.  X assign to Mr. Y the said trademark “TM” through an agreement (in writing) in relation to clothing and footwear alongwith the Goodwill associated with trademark “TM”.

In this case, Mr. X has also assigned to Mr. Y, the Goodwill associated with trademark “TM” for the business of clothing and footwear as well as for other goods or services. Therefore, Mr. Y is eligible to use the said trademark “TM”, for clothing and footwear including other goods or service dealt by Mr. Y.

2. Assignment without the Goodwill of Business: Where an assignor assigns to the assignee, the right and entitlements in a trademark with respect to the goods or services which are not in use by the assignor. In other words, where the assignor restricts the assignee with a condition that the assignee is not entitled to use the trademark assigned in relation to the goods or services already in use by the assignor. Such assignment is called assignment without the Goodwill of Business.

For Example: Mr. X is the owner of a trademark “TM” who is already using the said trademark “TM” in relation to clothing and footwear. Mr. X assign to Mr. Y the said trademark “TM” through an agreement (in writing) in relation to goods or services other than clothing and footwear without assigning the Goodwill associated with trademark “TM”.

In this case, Mr. X has not assigned to Mr. Y, the Goodwill associated with trademark “TM” for the business of clothing and footwear. Therefore, Mr. Y is not eligible to use the said trademark “TM”, for clothing and footwear. Thus, in case, Mr. Y wishes to use the said trademark “TM” in relation to other goods or services then he will be required to create separate Goodwill for trademark “TM” for such other goods or services dealt by him.

RESTRICTION ON ASSIGNMENT OF TRADEMARK:-

1. Parallel use Restriction: Where assignment results in creation of exclusive right in different persons, in relation to same or similar goods or services and the use of the trademark will be likely to deceive or cause confusion. Thus, multiple exclusive right in relation to same or similar goods or services, in different person is not allowed. This prevents the parallel use of a trademark by more than one person concerned in relation to same or similar goods or services. (Section-40)

2. Multiple Territorial use Restriction: Where the assignment results in creation of exclusive right, in different person in different parts of India, in relation to same or similar goods or services. Thus, assigning of scattered right in different parts of India is not allowed. (Section-41)  

PROCEDURE FOR ASSIGNMENT OF TRADEMARK:

REGISTRATION OF ASSIGNMENT OF TRADEMARK:

1. A person (subsequent proprietor) who becomes entitled by way of assignment, shall apply for registration of assignment before the Registrar of trademarks. (section 45)

2. After due satisfaction of the Registrar of trademarks, the Registrar shall enter the details of the assignee (subsequent proprietor) as the proprietor of the trademark assigned to him in respect of goods or services for which the assignment has been made. (section 45)

3. Where the validity of assignment is in dispute between the parties, the Registrar may refuse to register the assignment until the rights of the parties are determined by the competent court. (section 45)

4. Registrar of trademark shall dispose of the application for registration of assignment of trademark within a period of 3 (three) months from the date of receipt of application. (rule 76 of Trade Marks Rules, 2017 )

5. Registrar may, where there is reasonable doubt about the veracity of any statement or any document furnished, may call upon any person who has applied to be registered as proprietor of a registered trademark to furnish such proof or additional proof of title as the Registrar may think fit. (rule 77 of Trade Marks Rules, 2017)

6. Where in the opinion of the Registrar any document produced in proof of title of a person is not properly or sufficiently stamped, the Registrar shall impound and deal with it as per Chapter IV of the Indian Stamp Act, 1899 . (rule 78 of Trade Marks Rules, 2017)

7. Where the Registrar has allowed the registration of assignment, then there shall be entered in the register the particulars as follows(rule 84 of Trade Marks Rules, 2017):-

a) the name and address of the assignee;

b) the date of assignment;

c) where the assignment is in respect of any right in the trademark, a description of the right assigned;

d) the basis under which the assignment is made; and

e) the date on which the entry is made in the register.

RIGHT OF THE ASSIGNOR ON ASSIGNMENT OF TRADEMARK:

The assignor terminates to have his rights, title or any interest in the trademark, the moment assignment deed is executed in favour of the assignee, irrespective of the fact that the name of the assignee has not been updated in the record of the Registrar of trademarks.

In the matter of Classic Equipments Pvt. Ltd. Vs. Johnson Enterprises, 2009 (41) PTC 385 (Del), it was observed as follows:

“Once an Assignment Deed has executed, the Assignor ceases to have any right, title or interest in the property assigned. It is not open to the Assignor to cancel the assignment by means of communication”.

RIGHTS OF THE ASSIGNEE: WHEN ASSIGNMENT IS COMPLETE BUT REGISTRATION IS PENDING:

Though as per section 45 of the Act, it is mandated that the assignee shall apply before the Registrar of the trademarks to register his title. But this does not mean that recording of assignment of registered trademark asserts all rights or titles or interest in the assignee.

The reason behind this understanding are the opening words of section 45 of the Act, which says “where a person becomes entitled by assignment or transmission of a registered trademark, ……..”. Therefore, the first condition is entitlement of rights, title or interest by way of assignment or transmission of a registered trademark followed by registration of assignment of a registered trademark. Thus right in assignee does exist even before the registration of assignment.

In the matter of M/S. Modi Threads Limited vs M/S. Som Soot Gola Factory And…. on 4 th December, 1990: AIR 1992 Delhi 4, 1992 (22) DRJ 24 was observed as follows:

“It is true that the plaintiffs application for getting transferred the registered trade mark in its name in the office of the Registrar is still pending but that does not debar the plaintiff to protect the violation of the aforesaid trade mark at the hands of unscrupulous persons by filing an action in court of law for injunction. It is, prima facie, clear to me that during the interregnum period when the application of the plaintiff is kept pending for consideration by the Registrar of Trade Marks the dishonest persons cannot be allowed to make use of the said trade mark in order to get themselves illegally enriched earning upon the reputation built up qua that trade mark by the predecessor-in-interest of the plaintiff.”

The assignee of a trademark is also entitled to file a civil suit, even though the recording of assignment of registered trademark is pending before the registrar of trademarks. Moreover, section 45 does not confer any title over the trademark assigned. Instead the registration granted under section 45 is only proof of title of the trademark of assignee or the person who acquired it by way of assignment.

IMPORTANT KEY POINTS

√ Assignment is to be in writing;

√  Registered or unregistered both type of marks can be assigned;

√  Assignment can be with or without the goodwill of the business;

√  Event of assignment asserts the rights and title in an assignee not the registration thereof;

√  Registration of assignment is only prima facie proof of title of trademark;

√  Rights in an assignee exists even before registration of assignment of trademark.

Conclusion: –

Assignment of trademarks allows the Proprietor thereof to en-cash their intellect, efforts, time and money. It is equally important to register the assignment of trademark, since on registration the details of the assignee are updated in the register of trademark, this serves as a notice to public at large. Moreover, preparation of assignment agreements are also important as it involves rights, entitlements, interests and obligation including the commercial terms between the assignor and the assignee.

Disclaimer: The entire content of this document has been prepared as per the relevant provisions of the Act and rules made thereunder, applicable at the time of preparation. Though proper care has been taken to ensure accuracy, completeness and reliability of the information provided therein. The users and readers agree that the information provided in this document is not professional advice. Therefore, we assume no responsibility therefrom. Further, this write up shall not be considered as solicitation in any manner.

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Assignment and Licensing of Trademarks in India

In this article, Ranjit Krishnan Ramanath  who is currently pursuing M.A. IN BUSINESS LAWS , from NUJS, Kolkata, discusses Assignment and Licensing of Trademarks in India

Abstract of the research undertaken

The trademark assignment in the handling to license under the original Trade markets Act 1999. (The exchange of the former Trademark Act 1958) is concerned only to the ‘permitted use’ and ‘registered use ‘ because the former Act was expanded to reach the range of the word   ‘permitted use only. The trademark should be accomplished to authorize the outsiders without need to enroll the license as the ‘registered user’. The demand is to note with a Government Agency, Which is the trademark Office has been eliminated to with the failure to enroll should not permit a license invalid (Anon, 2010).  In the course of recent years, the law of government trademark licensing has adjusted radically in the reaction of the new commercial factors of supplying the trades and administrations. Because the slow adjustment is to move towards the licensing.

It slowly accepted in point of commercial development in the law. It refuses that the license trade markets has turned into a commercial practicing hub. However, in the meantime,  the law has given to satisfaction of specific conditions, viz. ‘quality control’ or ‘association in course of exchange’, which should be confirmed to as the trademark holder chooses to go into a permit game plan. Also, it is recommended that a trademark proprietor ought to maintain a strategic distance from a restrictive permit since it might be perused as a task. Likewise, despite the fact that the arrangement of keeping records of enlisted clients of the trademark is not any more predominant, enrollment keeps on conveying extra points of interest for a trademark proprietor under the present plan of the Act. Moreover, area 53 of the Indian Trademark Act, 1999 makes a motivating force for enlistment by denying the unregistered licensees of the privilege made by the excellence of Section 52.

The thought of responsibility for a development and its security is not new to humankind. To make a clear distinction of clear process for the prevention of crime over individual attempted goals will do have a low quality of merchandise creation process in the infringer reassessed. Taking a trademark process well known that would help in developing a trust in merchandise and have potential customer process. Taking a point of recheck and their implied need for maker directly reflects individual personal stake.

In the medieval times two essential sorts of imprints could be found:-

• Merchants Mark
• Production Mark

Using these process for Mark demonstration of these production needs and their origin are made as per specifications. It is more of additionally etched process in boats and other given specifically for their technique for trademarks for their occurrence for ship destruction for a proof ad there conceivable. Other individuals working together or in societies began declaring it as a blemish on their merchandise. This made the producer in charge of the nature of the merchandise that was being created and helped them to hold their clients [1] .

What is trademark authorizing?

• Trademark permitting is the point at which you as a trademark proprietor approve an outsider to utilize your check in course of exchange thought of sovereignty over the offers of items or administrations authorized under the trademark [2] .
• By and large, there is “established trademark permitting” done under which the licensee can make items utilizing the trademark authorized. Different types of permitting incorporate marketing, diversifying and so forth. So trademark [3] permitting is the point at which a trademark proprietor permits others to utilize the check without exchanging of possession.

Why would it be a good idea for one to permit a trademark?

It’s the most ideal path in which you can extend your business in locales you haven’t, as of now. All the more imperatively, it is monetarily truly gainful for both the licensor and the licensee. To be more particular, from the licensor’s perspective, it is that compelling business methodology that will just outcome in your officially all around perceived trademark to end up distinctly much more rumored. Like specified before, it is likewise a decent approach to extend your trademark’s topographical reach, enhance mark deceivability and other like things.

From the licensee’s perspective, it allows you to partner yourself with a very much perceived trademark; in this manner giving you a high ground on your rivals. Similarly as on account of physical property, for example, arrive, each proprietor of a Brand or Trademark has the privilege to offer, permit, exchange, and so forth its particular image or trademark as per legitimate strategies. Taking a view on varied factors of branding and trademark will make an impact with that of rights and its methods and task. As per Indian process, the trademarks Act,1999 would have authorization based on it. Simply put, if there should be an occurrence of a task of a trademark, there is an adjustment in the responsibility for enlisted mark and in the event of permitting; the privilege in the exchange stamp keeps on resting with the first proprietor yet just far few confined rights to utilize the brand/check are given to the outsider.

Business Objectives

• Entities can negotiate lump some  prices for the transferring of assignment of their respective trade mark for which is ethically a new arena of business in the current society. The business objectives further extends to allowing entities from other part of the world to render service or manufacture goods under the owner’s trademark by duly establishing a relationship through a trademark licence agreement.
• Having a trade mark also benefits by teaming up with respective partners , increasing the capacity of producing , services and marketing  without the requirement to expanding ones own company.  This opens up new route for delivery or partitioning in the market. By getting the Trade mark licensed, the Company enters into a new area of business which is not used by any entities in the market of the specific geographical area.
• Every entities can have their selections based on what appears to be challenging and more appealing for them in terms of the concerned business the party intends to participate.  In case if there disputes, insurgency, acquisition or insolvency of the Company, the owners can take decision to converge a few or can be abandoned by the owners of the Company.
• The Owner can also retain such ownership of the trade mark or can lease it to somebody else so that the owner could continue in doing the business under the said trade mark without abandoning its business in the Public Domain. The owner can still acquire revenues having the same trademark license. In the current world, Partnership licensing is beyond the horizon of merely lending a logo into establishing a true partnering of business relationship which gives a lot of drive and success to the key business of the Company. For example when Paper pulp manufacturer and a Temporary ceasing Contractor teamed up to develop false ceiling tiles which was not a simple Licensing but was an established business tie up of developing a product which was truly a great success for both the parties.
• Sometimes the mark is fringed by another entity with an object to tampering the brand name, quality and compromising the reputation of the Company. In several instances,  many local vendors use others brand to promote their sale of goods.   The infringers can basically convince the owners of potential business in a tie up and get into business. For most of the Companies, registering a trademark is mere a recognition than a source of revenue. Company shows keen interest in increasing the Customer recognition of the product that the revenue or sales as a part of promotion or advertisement. While another Entity partners the brand, the promotional or the advertisement costs are shared.

Financial and Commercial considerations of a Trademark

• The Royalties or the payments can be paid or received in a form of a lump amount wherein at the time when the rights of the license is granted upon another entity. This can either be a fully paid agreement or can be periodically paid until the period over the term of the License. Under the royalties, the most common kind of consideration provided by the Entities by some kind of upfront fee  or based on the success in sales.

Royalty has to be dealt with in the following ways,

• We need to ascertain when the Royalties are required to be paid,
• What kind of penalties are to be imposed for failing to pay on time,
• Any issues of holding international taxes where there were a requirement to pay out the monies in the Country of established business,
• Any accrued interest on the outstanding payments or due to kind of payment.

Typically if we look into various Trade Mark Licensing agreement , the Royalty calculation would depend on a number of other factor which would include a relative bargaining skill of the Licensor and licensee, Its potential to acquire profit  and how well the TM could be known in the marketplace that deals with that particular kind of product or service. The Competitive situation of the market is quite challenging and the Royalties would surely depend on the extent of its success through the market. The base calculation of Royalties whether it is from the gross sale or the net sale, all other associated costs of the overheads , profit margins , the calculation depends

The base calculation of Royalties whether it is from the gross sale or the net sale, all other associated costs of the overheads, profit margins, the calculation depends on a pre-determined rate at which the owner feels would be appropriate within a range of his profit margins. In short, Royalties is a rewarding gesture from the Owner in connection with his performance and appreciation of the parties involved in the business mutually supporting to enhance business.

Procedure of Registration of Trademark in India

The process required for the enrollment of the trademark in India is shown in the figure,

Assignment of Trademarks in India

The assignment of a trademark takes place when the ownership of such trademark is transferred from one entity to another, which may either be along with or without the goodwill of the trademarked business and which has to be recorded in the register of trademarks.

Following is the process of assignment of trademark in India:

• Complete Assignment of trademark from one entity to another: The owner transfers all his rights held in the trademark to the other entity.
• Assignment of trademark with respect to only certain goods and services: Here, the ownership of trademark is limited to only certain products or services. For example, “A” is the owner of a brand and uses his trademark for selling computers, television sets, and air-conditioners. “A” assigns “B” the rights in the brand with respect to only the Air-conditioners, and whereby “A” retains the rights in the brand with respect to computers and television sets.
• Assignment with the goodwill: Here, the absolute ownership over the rights and value of a trademark associated with the product is transferred from one entity to another. For example,”A” is the owner of a brand and uses his trademark for selling computers. “A” sells his brand to “B” whereby “B” retains all such rights vested in the brand and can use the brand trademarks for selling computers as well as other electronic products of his choice.
• Assignment without the goodwill: The assignment without goodwill is also known as “gross assignment”. Here, the assignment refers to restrictions of rights of the buyer whereby it limits the new owner of using the brand on products that the original owner is already For example, “A” is the owner of a brand and uses his trademark for selling computers. “A” sells his brand to “B” such that “B” will have no rights to use the brand trademark for selling his computer products. However, “B” can use the brand trademark in the chain of businesses other than a computer.

Using the case process of Trademarks Act 1999, there is a restriction of these process as per the registered process and their confusion amid various other clear public users and other clear deliverables.

Such restrictions are

• Giving an account of these assignments and their results would have rights in a more desperate work have effective goods and services. It further has a clear need for association as per deeds.
• Taking the approach of these Assignments and their results would have different effective process in a larger Spectrum.

Licensing of a Trademarks in India

• The licensing of a trademark allows the licensee to use the trademark, albeit the trademark itself is not assigned to the other entity, that is to say, the ownership has not been transferred but the mere use of the trademark is permitted to be used by the licensee.
• Licensing of trademark has a plethora of benefits for both entities. Here, the licensor may enjoy his rights to the trademark by generating royalties for its use, whereby the licensee is able to broaden his market chain operations by using the said trademark for building reputation and brand value.

In layman words, a licensor has the right to license his rights over the trademark as he may be pleased with, such as by restricting the rights of the licensee in the trademark with respect to products or services. The licensor may restrict the time and area within which said trademark can be used by the licensee with respect to the product and services.

Agreements for Transmission

Trademark assignments are generally executed by way of trademark assignment agreements under which the transmission of transfer takes place from one entity to another [1] .

The following points are to be ensured while drafting such agreements for the assignment and licensing of trademarks in India,

• That the rights of the trademark brand do not tend to cause harm due to obligations prescribed in such agreement.
• The provision with regard to the assignment is with or without the goodwill of the business should be properly negotiated and explicitly mentioned in the agreement.
• The agreement must be drafted in accordance with the purpose of the transaction in question.
• The rights and duties of the licensee must be distinctively pre-determined and defined.
• The license agreement should be registered with the trademark Registrar, although it is not compulsory but in a legal perspective, it is most advisable.

It is more of the licensed for their agreement for Trademark Act 1999, relieved which do provide registration for the license agreement. Using the process of the Trademark Assignment will do make an impact in rights and duties for their distinctively determined and further relieved.

Understanding the process of assignment and licensing of trademarks in India is a paramount issue. The process of marketing and strategic management would surely open a plethora of broadening horizons in this domain, for the licensor and licensee likewise. It all depends upon the development of a brand, and the use of the brand, which collectively form a factor to boost marketing in various sectors.

Having an agreement which set an example for creating IPR and do allow intellectual property transfer of these commercial returns. It is further ensured that various deliverable monetary gain will have utilization as per the Agreements and have purchase value using the benefit of right made up and also provide legal and equitable rights for law and other important Issues. Further acceleration of these IPR would do study the IP rights more rigorously and have companies own valuable needs more carefully understandable and have IPR made out of scope and address the needs of the resource.

It further defines and also provides clear obligations for not able to disclose and create clause to address the issue with the jurisdiction of Alternative Agreement clause for these issues legal contract for their compliance exist laws.

It is, however, worth to note that the ability of a Company to Sell or buy is very much required to sustain in the market. Although the Trademark does not take much of space, too much of IP can actually be a burden to the Company due to the funds required to maintain the registering fees, for its proper defense if there is any third party claim or for manufacturing and sale for a final production. , or creating and marketing a final product. For a Company to sell an unused IP, this can usher the Company’s financial position and could generate revenues and decrease the overall Costs.  Selling unused or surplus intellectual property can have an immediate positive effect on a company’s finances, generating revenue and decreasing costs.  When the Company plans to enhance its business, Company looks forward in purchasing trademark to support their business motive, creating an identity for themselves and ensure that this is properly marketed.

This was all about Assignment and Licensing of Trademarks in India. Please comment below and let us know what are your views on Assignment and Licensing of Trademarks in India. Do not forget to share.

Bibliography

Ng, D. L. a. P. W., 2010. Intersect between Intellectual Property Law and Competition Law. Journal of Management.

Anon, 2010. REGULATION OF INTELLECTUAL PROPERTY IN THE LEGISLATIVE CONTEXT WITH SPECIAL REFERENCE TO. Journal of Management.

Anupam Goyal, 2003. “Recognizing the property rights regime for indigenous knowledge of biodiversity in face of TRIPS Agreement”. National Capital Law Journal, 6(9), pp. 129-153.

Dutta, R., 2008. Critical Analysis: Reflection of IP in Competition Law of India.

kumar, B. a., 2006. law of trademarks in India. 2nd ed. Delhi: center for law.

L, W. B., 2000. law relating to patents, trademarks, copyright, designs and geographical indications. 2nd ed. Delhi: universal law publishing co pvt .

S.Chakravarthy, 2005. Evolution of Competition Policy and Law in India. New Delhi: Academic Foundation.

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Assignment of Trademarks in India

Trademarks like any asset can be transferred from one owner to another. The transfers could be temporary through licensing or permanent through an assignment. Assignment of trademarks is a process in which the owner of the trademark transfers the ownership of the mark either with or without the goodwill of the business. In other words, it is transferring of proprietary rights in the property of the proprietor. The manner in which an assignment can be made are as follows:

Complete assignment of trademarks

In a complete assignment, the owner of the trademark transfers all the rights with respect to the trademark, including the transfer of the rights such as right to further transfer, earn royalties, etc., to another entity.

For example, A, owner of “xyz”, sells his brand to another through an agreement to B. After this, A does not retain any rights with respect to “xyz”.

Partial assignment of trademarks

In a partial assignment, the transfer of ownership is restricted to specific product or service only. The owner may retain the right to further transfer, to earn royalties etc.

For example, A, owner of a tea and a biscuit brand, transfers proprietary rights only with respect to the tea brand and retains the rights over the biscuit brand, this is said to be a partial assignment.

Assignment with goodwill;

This is an assignment where the owner transfers the rights and value of the trademark as associated with the product it sells;

For example, A, owner of “TH” trademark for manufacturing and selling of watches, can assign the trademark along with giving the assignee the right to use the said trademark for the same product.

Assignment without goodwill

This is an assignment where the owner restricts the assignee to use trademark for the products he uses it for. That is, the goodwill attached to the owner’s brand with respect to the product already being sold under such brand, is not transferred to the buyer. This means that assignor & assignee both can use the same trademark but in dissimilar goods or services.

For example, if the owner of the trademark “TH” uses it for manufacturing and selling of watches and decides to assign it without goodwill, it means that the assignee can use the trademark “TH” for any other product other than watches.

Once a trademark is assigned it is important to record the change in ownership with the Trademark Registry. Specific forms with fees have to filed to ensure that the records reflect the ownership details.

Procedure to record the assignment of trademark with the Registry:

Assignment of an unregistered mark:.

Section 39 stipulates that an unregistered trade mark may be assigned or transmitted with or without the goodwill of the business concerned. A request has to be made on Form TM-16 for an unregistered trademark to be assigned or transferred.

Assignment of a registered trademark:

Section 38 stipulates that trade Marks can be either assigned in full or transmitted in part, with or without the goodwill of the business. All transmissions or assignments must be registered with the Registrar of Trade Marks on Form 23 or 24 of the Trade Marks. (Rule 68 of the Trademarks rule, 2002).

In a case of assignment or transfer of a single trade mark:

• if made within six months from the date of acquisition of proprietorship, then the official fee is Rs. 5000;
• if made after expiration of six months but before 12 months from the date of acquisition of proprietorship, then the official fee is Rs. 7,500;
• if made after 12 months from date of acquisition of proprietorship, then the official fee is Rs. 10,000.

In case of assignment of more than one trademark:

• if made within six months from the date of acquisition of proprietorship, then the official fee is Rs.5000 for the first mark and Rs.1000 for every additional mark;
• if made after expiration of six months but before 12 months from the date of acquisition of proprietorship, then the official fee is Rs.7,500 for the first mark and Rs.1500 for every additional mark;
• if made after 12 months from date of acquisition of proprietorship, then the official fee is Rs.10,000 for the first mark and Rs.2000 for every additional mark.

From a practical perspective , this is what you need to incorporate in any assignment deed which involves trademarks;

1.  The assignment deed must be in writing where the assignor’s name must be same as it is in the Register of Trademarks, i.e. the owner of the trademark;

2.  It is absolutely necessary that the territorial extent of the assignment is clearly laid down; for example, if the assignee is based in India, then it is a must that the assignment deed contain a clause saying the assignment is for that particular region;

3.  The next obvious thing is, the mark/marks that the proprietor wants to assign must be mentioned clearly;

4.  The consideration that the assignee needs to pay should be mentioned as well; the standard phrase of “good and valuable consideration” wouldn’t hold good; The stamp duty has to be calculated on the basis of the consideration.

5.  The effective date of the assignment must be laid down clearly;

6.  The most important part of an assignment deed is to mention if the assignment is along with the goodwill or not.

As can be noted, transfer of proprietary rights in trademark is similar to transfer of any other asset; Trademarks are valuable assets since they quantify a company’s reputation and goodwill. While making sure the assignment is in order you also have to keep the records of the trademark registry updated with these changes.

This article has been authored by Durga Bhatt , an IP Law practitioner.

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Assignment & Licensing Of Trademarks In India

Contributor.

Just as in the case of physical property such as land, every owner of a Brand or Trademark has the right to sell, license, transfer, etc. its respective brand or trademark in accordance with legal procedures. A brand or Trademark owner can transfer his rights with respect to his trademark either by way of assignment or by licensing. In India, The Trade Marks Act, 1999 deals with assignment as well licensing of trademarks.

To put it summarily, in case of an assignment of a trademark, there is a change in the ownership of the registered brand and in case of licensing, the right in the trade mark continues to vest with the original owner but only few restricted rights to use the brand/mark are given to the third party.

ASSIGNMENT OF A TRADEMARK

Assignment of a trademark occurs when the ownership of such mark as such, is transferred from one party to another whether along with or without the goodwill of the business. In case of a registered Trademark, such assignment is required to be recorded in the Register of trade marks.

A mark may be assigned or transferred to another entity in any of the following manners:

• Complete Assignment to another entity- The owner transfers all its rights with respect to a mark to another entity, including the transfer of the rights such as right to further transfer, to earn royalties, etc. (E.g. X, the proprietor of a brand, sells his mark completely through an agreement to Y. After this X does not retain any rights with respect to the brand)
• Assignment to another entity but with respect to only some of the goods/ services- The transfer of ownership is restricted to specific products or services only. (E.g. P, the proprietor of a brand used for jams and jellies and dairy products. P assigns the rights in the brand with respect to only dairy products to Q and retains the rights in the brand with respect to jams and jellies.) This is called partial assignment.
• Assignment with goodwill- Such assignment is where the rights and value of a trademark as associated with the product is also transferred to another entity.(E.g. P, the proprietor of a brand "Shudh" relating to dairy products, sells his brand to Q such that Q will be able to use the brand "Shudh" with respect to dairy products as well as any other products it manufactures.)
• Assignment without goodwill- Such assignment also referred to as gross assignment, is where the owner of the brand restricts the right of the buyer and does not allow him to use such brand for the products being used by the original owner. Thus, the goodwill attached to such brand with respect to the product already being sold under such brand, is not transferred to the buyer. (E.g. P, the proprietor of a brand "Shudh" relating to dairy products, sells his brand to Q such that Q will not be able to use the mark "Shudh" with respect to dairy products but can use this brand for any other products being manufactured by it. In such case the goodwill which is associated with brand "Shudh" for dairy products is not transferred to Q and Q will be required to create distinct goodwill of brand "Shudh" for any other product or service like Restaurant wherein Q proposes to use this brand.). In many jurisdictions like United States, assignment of mark without goodwill is not allowed at all. India on the other hand allows assignment without goodwill.

Further, in case of registered Trademarks, the Trade Mark Act 1999 also puts certain restrictions on the assignment of a registered trade mark wherein there exist possibilities of creating confusion in the mind of public/users. Such restrictions are:

• Restriction on assignment that results in the creation of exclusive rights in more than one persons with respect to the same goods or services, or for same description of goods or services or such goods or services as associated with each other.
• Restriction on assignment that results in different people using the trademark in different parts of the country simultaneously.

TRADEMARK LICENSING

The licensing of a mark is to allow others to use the mark without assigning the ownership and the same may be done for all or some of the goods and services covered.   The Trademarks Act does not mention the term 'License', the concept under the Act is mentioned as that of a 'Registered User'.

Trademark licensing is advantageous to both the parties. While the licensor enjoys its rights to the mark by getting the royalties for its use, the licensee is able to expand its market operations by using the brand and developing its reputation.

In case of Licensing, the licensor is open to license the rights over the trademark in manner it may like. The Licensor can restrict the rights of the licensee in a trademark or brand with respect to the products or services wherein the licensee can use such brand, with respect to time for which it can use such mark, with respect to area within which it can use such mark etc.

AGREEMENTS FOR TRANSMISSION

A trade mark is generally assigned by way of a properly executed Trademark Assignment Agreement which pertains to the transfer of the mark from one person or entity who is the owner to another. It is to be ensured when drafting such agreement that:

• the rights of the owner of the brand are not detrimentally affected due to the obligations contained.
• the requirement and decision regarding whether the assignment should be with or without the goodwill of the business is explicitly mentioned and negotiated
• the agreement should be drafted keeping in mind the purpose of the transaction in question

A mark is licensed by way of aLicense Agreement. As per the Trade Mark Act, 1999, contrary to the requirement in case of Assignment, the registration of license agreement with the Trademark Registrar of a mark is voluntary and not compulsory, but it is advisable. Further, like in an Assignment agreement, it is again very important that while drafting a License Agreement, the rights and duties of licensee are distinctively pre determined and defined. This is important not only to protect the rights of the Licensor in its own brand and to protect any misuse thereof, but also to secure licensee with his rights to use such brand.

TO SUM UP..

Assignment and Licensing of brands are considerable issues and proper strategizing may open vistas of opportunities for all, a licensor, a licensee, an assignor and an assignee. Both concepts involve a degree of planning for the future of the parties involved and the brand in question. The development of a brand, its propagation and its use, all lie in the hands of the proprietor of the brand and trademark and assignment and licensing are effective methods to manage the same.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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