Why You Should Apply for a Trademark Registration for Your Corporate Name
A corporate name used as the company’s brand is one of the most valuable trademark assets of a business. Your brand will represent the quality of your goods and services and evoke a particular image and reputation amongst consumers. A strong brand will help facilitate sales of goods and services with which it is identified.
Consider the sales you may lose and the confusion that could be caused if another company opened up using your same name. If you’re building a brand, investing in advertising and hoping customers can find you, you’ll want to make sure you’ve properly protected your business name so no one else can use it. There is no better insurance than a trademark registration to protect the name which you have spent time and money developing and securing.
It is often assumed that since the incorporation process includes a search of corporate names and provides permission to operate a business under the corporate name that (a): you can adopt and use the corporate name to sell your goods and services in Canada; and (b) that others may not adopt and use your corporate name as a trademark in Canada. In other words, many assume that adopting a corporate name is the same as adopting a trademark.
This, unfortunately, assumes too much. Registration of a corporate name does not provide you with trademark protection, nor does it fully ensure that the corporate name registered may be used as a trademark in association with the sale of goods and services in Canada.
Registration of Your Corporate Name during the Incorporation Process
In Canada, a company may be incorporated under federal legislation, the Canadian Business Corporations Act, or under one of the laws of a province or territory, such as the Ontario Business Corporations Act.
One of the steps in incorporating a company is registering a corporate name. Many entities incorporate as a numbered company for expediency (12345678 Inc., for example), and then later register a business name (also referred to as a trade name) for the name under which it intends to carry on business.
A corporate name approved as part of an incorporation process allows your company to operate a business using that corporate name within the province or territory registered, or across Canada if registered under federal legislation.
This permission to operate a business using that corporate name is limited in that it does not extend permission or protection to offering goods or services in Canada in association with part or all of your corporate name as a trademark. It only applies to the operation of the business. The right to adopt and use your corporate name as a trademark in Canada is subject to the Canadian trademark rights of others.
How Do I Find Out If I Can Adopt and Use My Corporate Name as a Trademark in Canada?
As noted above, registering a corporate name does not automatically give you the right to use that corporate name as a trademark in association with particular goods and services. The registration process for a corporate name may turn up other registered trademarks but will not, for example, uncover prior and ongoing uses of the same name or a confusingly similar name as an unregistered trademark. These can only be found by conducting an in-depth trademark search, a process that is not a part of the corporate name registration process.
The identification of prior use of a common law trademark, if continuous, could expose you to risk and liability. In particular, it could make you liable for passing off once you start using your corporate name and could also defeat your attempt to register part or all of your corporate name as a trademark in association with the goods and services you intend to offer since a confusingly similar mark will have already been in use.
In order to optimally clear a trademark for adoption and use in Canada, a trademark clearance search, which includes common law coverage, is recommended. You can read about trademark searching in our article on conducting trademark searches.
Conducting a clearance search will give you confidence that the trademark can be safely adopted in Canada--except if the search turns up existing confusing marks. In that case, it will highlight the risk of conflict with third parties and help you determine whether to proceed to adopt and use the trademark in Canada.
How Can I Protect My Corporate Name from Use by Others as a Trademark in Canada?
A corporate name registration attempts to ensure protection of the public from deception; it does not provide protection of the corporate name from misappropriation by others.
While rights to corporate names may be enforced under the common law action for passing off, there are comparative disadvantages to proceeding by way of a common law action for passing off as opposed to enforcing rights in a registered trademark, which are discussed in more detail in “5 Benefits of Registering Your Trademark in Canada”.
If your corporate name will be used as your brand or to name goods or services, it is best to take extra precaution and apply to register it as a trademark. What a shame it would be to spend effort, time and money in the development of a brand only to learn that your rights to exclusively use the mark could be compromised without a registration.
Registering a trademark affords you the proprietary rights that are not provided with the registration of a corporate name. This nationwide protection and exclusive right to use a registered trademark for the goods and services with which it is associated in Canada allows the trademark owner to prevent others from using the same or confusingly similar trademark in Canada and to enjoin infringement by others.
Based on considerations made with regard to the advantages and disadvantages of registered and unregistered trademarks, registering your corporate name ought to be strongly considered.
If you would like to learn more about how to trademark a name in Canada, please do not hesitate to contact us for a complimentary and confidential telephone appointment.