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11 Benefits of Registering Your Trademark in Canada
Registration of a trademark provides significant benefits for the trademark owner including:
- nationwide protection across Canada for 10 years;
- priority rights in respect of applications in other jurisdictions;
- an assumed right to exclusive use of the trademark across Canada;
- an enhanced ability to enforce trademark rights in Canada;
- lower cost of enforcement;
- availability of monitoring for counterfeit products at the Canadian border by requesting the assistance of the Canada Border Services Agency (CBSA);
- public notice of your ownership by way of the Canadian trademark register;
- enhanced ability to license trademark rights in Canada to others;
- the creation of an asset on your company’s balance sheet;
- the ability to initiate domain name ownership disputes and register .CA domains; and
- exemption from the Charter of the French Language in Quebec.
Altogether, the benefits of trademark registration reward trademark owners by increasing the value of their brand and business and by providing stronger rights for enforcing their trademark which better enables their business to grow.
Nationwide Trademark Protection across Canada for 10 Years
A trademark registered in Canada is protected nationwide. If the owner continuously uses the trademark in connection with the goods and services with which the trademark is associated, the mark is protected. The registration of a trademark provides the exclusive right to use the trademark in connection with the goods and services associated with the trademark across Canada, without any geographical restrictions.
In contrast, protection of an unregistered trademark is limited to the geographical areas where the trademark is used and known. That is, an unregistered trademark is only enforceable where the trademark has gained a sufficient reputation and proving the existence of a sufficient reputation is a much more costly exercise than having the foresight to have obtained a trademark registration before enforcement of trademark rights is required.
A Canadian trademark registration is valid for up to 10 years and can be renewed indefinitely. The payment of a renewal fee within a specified period is the only requirement to renew a registered trademark. Filing a declaration of continued use is not necessary.
Priority Rights in Respect of Applications in Other Jurisdictions
A trademark owner who files an application for its registration in Canada can, within 6 months of that filing, apply for registered trade mark protection in any of the other countries in the Paris Union (including, among them, the United States, the UK, and China) and this application will have priority over other applications for the same or other citable marks filed during those 6 months.
Right to Exclusive Use of the Trademark in Canada
Registering a trademark gives the trademark owner statutory exclusive rights to use the trademark for the goods and services with which it is associated in Canada. This exclusive right is an assumed right that is evidenced simply by owning a registration, whereas there is an evidentiary burden to show common law rights to a trademark.
To be afforded this exclusive right, a trademark owner can apply to register the trademark even before beginning to offer goods or services associated with the mark to the public. In contrast, common law rights to a trademark are conferred upon an unregistered trademark owner only after use over a period of time and becoming well known amongst the public.
Trademark owners should consider applying for their trademark registration as early as possible. Owners of marks who delay their registration may later be surprised by an existing registration or application for their mark preventing them from registering. Although the mark may have been filed in good faith, it is not uncommon to see marks held hostage in this way by “trademark trolls” seeking to extract payment for the use of the mark by its good faith owner.
In the context of disputes, a registered trademark owner does not need to first prove ownership; rather the onus is on the challenger to demonstrate the registered trademark owner is not so entitled to the trademark. In contrast, a dispute arising in the context of an unregistered trademark may lead to an expensive and lengthy legal dispute to determine whether the claimant even has enforceable trademark rights.
Enhanced Ability to Enforce Trademark Rights in Canada
Once a trademark is registered, the same or a confusingly similar trademark cannot be registered in Canada. Accordingly, registering a trademark can dissuade others from attempting to register the same or a confusingly similar trademark. In the event that another adopts and uses the same or a confusingly similar trademark, the owner of the registered trademark has access to greater enforcement options than the owner of an unregistered trademark.
Trademark causes of action are available to a registered trademark owner if a third party uses: 1) an identical trademark associated with identical goods or services; 2) a trademark that creates confusion with the registered trademark; or 3) a trademark in a manner that is likely to depreciate the value of the goodwill associated with the registered trademark. If any of these events arise, the owner of a registered trademark can enforce its exclusive rights to the trademark. The third cause of action, for depreciation of goodwill, is unlike anything available to unregistered trademark owners and gives registered trademark owners a basis for legal action even where the impugned use of the trademark is not use as a trademark (i.e., for the purpose of identifying the source of the goods or services). For example, a recent court battle between battery brands DURACELL and ENERGIZER proceeded on this basis. Although there was no confusion as to the source of the batteries sold by Duracell which also displayed the Energizer trademark, there was a cause of action because Duracell’s use of the Energizer mark was to compare its products to Energizer’s, potentially depreciating the brand’s goodwill.
The remedies available against a party who infringes a trademark or depreciates the value of its goodwill include injunctive relief, monetary damages or profits, and an order for the destruction of the infringing articles. Moreover, a registered trademark is a defence to passing off claims by others.
In contrast, the owner of an unregistered trademark may only enforce its trademark rights through a claim of passing off. To establish passing off, the unregistered trademark owner must establish that: 1) it has sufficient goodwill or reputation in its trademark; 2) the other party has misrepresented its goods or services in a way that leads to confusion with those of the trademark owner; and 3) the owner has suffered or is likely to suffer damage.
Accordingly, the additional legal grounds available to registered trademark owners gives them both stronger and broader enforcement tools for protecting their brand than are available to unregistered trademark owners.
Like registered trademark owners however, unregistered trademark owners can oppose an applied-for mark before it is registered and following its approval by the Trademarks Office. All approved marks are advertised in the Trademarks Journal before being allowed to register. Third parties have two months following the advertisement to oppose the application on any ground set out in the Act. Unregistered trademark owners can use these opposition proceedings to attempt to prevent a mark from registering which is confusingly similar with their own. Confusion with registered trademarks, on the other hand, is assessed during examination by the Trademarks Office, generally eliminating the need for registered owners to monitor the Journal for this purpose.
Further, registered trademark owners benefit from an additional means by which to inhibit the registration of a trademark for which an application has been filed. Rather than wait until the trademark is advertised, owners of registered trademarks can submit to the Trademarks office a “Notice of Third-Party Rights” setting out information the owner believes has bearing on the mark’s registrability. Two of the three accepted grounds for these notices relate to an existing application or registration. A registered trademark owner could submit notice that an applied-for mark is confusing with their own registered mark. Not only that, but the owner of a pending application could submit similar notice of the mark’s potential for confusion with their pending mark. This additional mechanism gives owners of applied-for or registered marks a chance to get ahead of an application before it’s advertised and flag what they believe to be potential for confusion to the Trademarks office. Unregistered trademark owners without a pending application do not have this option.
Lower Cost of Enforcement
As a result of the evidence provided by a trademark registration of the exclusive right to use the trademark for the goods and services with which it is associated in Canada, registered trademark owners benefit from a lower cost of enforcement when disputes arise. The cost of documentary and oral discovery to prove the existence of sufficient reputation, which would be required in the case of an unregistered mark, is entirely avoided.
Further, much of the cost of enforcing trademark rights may be avoided altogether as registered trademarks are more respected by lawyers and businesspeople at the cease and desist/demand letter stage. Being able to cite a trademark registration and the advantages of trademark registration in a demand letter sent to an entity or individual that is discovered to be infringing your rights is very valuable. Recipients of these letters will know you have stronger and more enforceable rights and will be more likely to comply with the terms of letter.
Availability of Monitoring for Counterfeit Products at the Canadian Border
Owners of registered trademarks may benefit from the assistance of the Canadian Border Services Agency in detecting counterfeit goods. The CBSA has the authority to temporarily detain goods at the border that they suspect are counterfeit without a court order.
Owners of Canadian trademarks may register for the CBSA’s Intellectual Property Right (IPR) program and submit a Request for Assistance (RFA) form. The RFA form will require owners to provide the CBSA with pertinent information, for example, the description of the registered trademark, details of the identifying markers on authentic goods, and a list of known distributors of counterfeit goods. Once the RFA is approved, the owner will receive notification should the CBSA come across a suspect shipment. The owner may then wish to pursue a remedy under the Trademarks Act. For more information on how to apply for a RFA, please consult our resource on Border Enforcement Regime for Intellectual Property.
Public Notice of Ownership of the Trademark in Canada
A registered trademark is entered in Canada’s Register of Trademarks. This Register is the record of all trademarks that have been applied for or registered in Canada.
Registration of a trademark, through its inclusion in the Register, serves as a public notice that the trademark is protected and that the trademark owner has a claim to exclusivity. This registration provides direct evidence of ownership and once a trademark is registered, the trademark owner receives a certificate of registration that can be used as proof of ownership.
When an application for registration of a trademark is received by the Canadian Intellectual Property Office, during the examination process CIPO will conduct a search of the register in order to determine whether there is a pending or registered mark already on the register that is considered to be confusingly similar with the applied-for mark. If the search does uncover a confusingly similar trademark, CIPO will issue an objection to the registration of the applied-for mark based on this earlier filed or registered trademark. Accordingly, this should deter others from adopting and attempting to register confusing trademarks, if a search of the register is properly conducted prior to filing and use.
Enhanced Ability to License Trademark Rights in Canada to Others
A brand protected through a registered trademark is a valuable business asset. Although both registered and unregistered trademarks may be licensed, the value of the licence to the licensee is greater when then trademark has been registered as the trademark owner's rights to the mark are stronger and more easily enforced against others.
A trademark owner can license its trademark for use by others, either by providing an exclusive or non-exclusive licence. It is important however that the trademark owner retain control over the character or quality of the goods or services offered by the licensee in association with the trademark or else it risks losing its rights.
Trademark licensing can be used to facilitate growth of a brand by either expanding the scale of operations or going outside of the trademark owner’s usual sphere of activity thereby increasing the brand’s reach. Furthermore, trademark licensing may be done for licence fees payable from the licensee to the licensor providing a revenue stream over and above the increase in brand value due to the licensee expanding the trademark's use and reach.
The Creation of an Asset on Your Company’s Balance Sheet
Although registered and unregistered marks both have value and represent assets of a business, assigning a monetary asset value to a registered mark is more easily justifiable and such a trademark is more valuable for all of the reasons set out in this article.
The Ability to Initiate Domain Name Disputes and Register a .CA Domain
If a trademark owner discovers someone is using their registered trademark in a domain name, there is the ability to initiate a dispute through the Canadian Internet Registration Authority (CIRA) or Uniform Domain-Name Dispute Resolution Policy (UDRP). This provides for registered trademark owners to arbitrate certain claims against a domain name registrant before an approved dispute resolution service provider. If such a claim is successful, the infringing domain will be transferred to the owner of the registered trademark.
Additionally, non-Canadian entities/individuals benefit from a Canadian trademark registration as it satisfies the Canadian presence requirements to register a .CA domain.
Exemption from the Charter of the French Language
The Province of Québec has its own special French language requirements that are protected by the provincial Charter of the French Language. Owning a registered trademark provides an exception to the requirements of this Charter, making it easier for trademark owners to brand their products and services consistently across Canada.
Although unregistered marks can also benefit from this same exception, owners will need to be able to prove their use and the established reputation of the mark, as in the case of passing off actions initiated by unregistered trademark owners.
Conclusion
Your brand is the face of your business in the Canadian marketplace and an important asset of your company. Given the benefits of a trademark registration, there is no doubt of a good return on investment for a trademark registration for a new or existing brand you expect to generate at least six figures in annual revenue in future. In the long run, protecting your brand proactively, rather than attempting to enforce your rights retroactively through potentially lengthy, expensive and uncertain legal proceedings is always the most cost-effective option.
If you would like to learn more about how to get a trademark registration in Canada or the United States, contact us now for a complimentary and confidential initial telephone appointment.
