Trademark is the perfect barrier to generally protect your MSME brand from losing its reputation, retaining its good trustworthy relationship with your existing and potential customers. As the Government of India has been very supportive by providing various reliefs for MSMEs and with the recent “Make in India” drive, giving a promising outlook, it thus, makes trademarks are the most important IP asset for the MSME as they now stand a good chance to make their trademark even more extensive and literal. Do you understand that the ‘brand’ and the importance of protecting it with trademarks and converting into an easily transferrable asset is often lacking? 

Understanding the connection between brand and trademark

Brands have evolved and have become more subjective. The names and logos are just a fraction of what a brand is and merely serves as a business card. Generally, a brand comprises several different elements that come together like namely image, character, identity, personality, essence, culture and reputation. This is by an MSME’s brand, through which its products can be easily identified and consequently, provide their business with an unchallenged competitive advantage in the market. A trademarked brand has the potential to simply increase the value as an intangible asset to use as collateral to obtain legitimate financial institutions. It is not possible to put a value on someone else’s emotions that they feel with a brand, but what could be done is to protect the brand and ultimately the consumer/client activating the legal rights that come with the trademark registration. The MSME has the trademark protected to their customers/clients from using the duplicates of your products/services, and in such a paradigm, it becomes all the more important that customer-oriented MSMEs, either in B2B or in B2C situations, empower their customers to identify their duplicates.

A pragmatic approach to trademarks for MSMEs

The MSMEs in India, in my experience, rely on common law tort of passing off to protect their brand name (in a court), products’ name, logos and any other visible sign which allows that their customers/clients to simply identify them in a marketplace. This approach, in simpler terms, is basically, the quintessential Indian approach of taking ad hoc measures, instead of coming up with long term advance planning, and this too is again led by the myopic cost-saving measures. Yet, every cost-saving measure of today, especially in IPRs, may snowball into a potentially expensive proposition in the future. The MSMEs must look at registering or “Trademarking” their brand names and logos as a cost-saving measure [keeping in view a potential infringement in future] and to ensure a much affordable instrument of enforcement in a court of law. In absence of a registered trademark, the aggrieved party cannot launch an infringement suit but can only launch a lawsuit under common law tort of passing off, and proving the prior usage/goodwill/brand[prior to that claimed by the infringer of the name to a court of law, and then obtaining an injunction against the infringer. Such a tedious enforcement process could be cut short simply by producing a trademark registration certification to the infringer, who is very likely to not contest a bona fide trademark registration certificate, in a court of law. A registered trademark also allows the trademark owner to institute infringement proceedings. Besides that, trademark registration in India is inexpensive for MSMEs, with the government scrapping off half the price of their trademark application fee for registered MSMEs.

Trademark as trade-able assets

Trademarks are also considered as a trade-able asset like other assets of an MSME, the trademark could be sold, licensed or purchased as per the needs of the other MSME or MNC. It is also quite possible for an MSME to sell their entire business [customers and tangibles] while retaining control of their brand names/logos [that is, trademarks], and then license that trademarks to several manufacturers.

When and where to register trademarks?

Over the life cycle of a product, the product may take several different names in view of several other factors. It is generally advised to register your brand names/trademarks/logos/trade-dress etc. Once you are ready to market the product and before its launch as the name is less likely to change this stage and it may have already gone through many internal reviews. All trademarks registrations are territorial, that is, a trademark registered in India is enforceable in India alone. If an MSME is inclined to sell its products abroad, it is highly recommended that they also have been registered to their trademarks in each of the potential countries. These international filings can be affected either directly or via the Madrid Protocol that significantly reduces the duration and costs of filing and obtaining trademark registrations in several countries. As Indian, MSMEs expand wings, and as Indian market opens up for foreign competition, which is much more aggressive in obtaining and enforcing trademarks, it will do a world of good to Indian MSMEs to prepare well for securing and enforcing their own trademarks, and registering them will just be the first step and inexpensive one at that.

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