Company Names and Trade Marks: A couple of helpful points
Friday 16th January 2015
Registering a business name with the New Zealand Companies Office does not provide formal trade mark protection for that name. It simply means that the Companies Office will not register any other company with that exact name.
When registering a company name in New Zealand, the Companies Office does not consider whether a chosen name infringes another party’s common law or registered trade mark rights or even if it is too close to the name of an existing registered company. As a result, when a company starts trading under its new company name it may infringe the trade mark rights of another party.
If a company is struck off or changes its name, the name becomes available again. The Companies Office will also allow unrelated companies to register very similar names, provided they are not identical.
While a company name registration is vital to running a business, it is also important to ensure that you are protecting your reputation in the company name (trade mark). Use of a similar trade mark by another party could cause damage to your business.
The best way to prevent other traders from using identical or confusingly similar trade marks to yours is to register the name of your business as a trade mark under the Trade Marks Act 2002. This will give you the exclusive right to use your trade mark throughout New Zealand for the goods and/or services for which it is registered.
Not all names can be registered but if a company name has been used as a trade mark for a significant period of time, you may have common law rights in that name and be able to stop someone else from using it. Use of an identical or similar name by a third party could constitute passing off and/or a breach of the Fair Trading Act 1986. Because enforcing non-registered trade mark rights against others can be difficult and costly, it is less expensive and more efficient to register a trade mark so that you have much more certainty as to the scope of your rights to a particular name.
Before choosing the name of your business, it is important to undertake a search not only of the Companies Register for names identical or almost identical to the proposed name, but to also search the New Zealand trade mark database to determine whether your use of the proposed company name will infringe another party’s rights. Failure to do so could mean wasted investment in that name, a forced name change at a later stage or trade mark infringement proceedings being issued against you.
This article was written by Rachel McDonald.
This article is intended to summarise potentially complicated legal issues, and is not intended to be a substitute for individual legal advice. If you would like further information, please contact a Baldwins representative.