How to Sell My Trade Mark When Selling My Business
Angus
If you are selling a company or separating a product line, you might need to transfer or sell a trade mark. You have the option of setting the trade mark’s selling price and negotiating the parameters of the transaction with your buyer. Once you have agreed on the terms of the contract, you will need to file assignment paperwork with IP Australia to notify them of the change in ownership. It should also be on your to-do list to think about assigning or transferring your trade marks.
Failure to recognise the worth of the trade marks owned by the firm and the requirement to transfer this intangible property in the same way as other physical assets, such as plant and stock, is a typical mistake made by trade mark owners during the sale or winding up of a business. For example, if a firm is wound up without the necessary trade marks being issued, it may be extremely difficult (and expensive) to correct the situation.
Are you wondering how to sell your trade mark when you sell your business? This article will explore some of the key considerations to think about before you sell your trade mark.
Agreement on Assignment
You should make a legally enforceable contract between your business and the customer. Additionally, make a list of everyone who is engaged in the transaction, including their:
- names;
- addresses; and
- contact information.
If the trade mark is owned by more than one person, then an assignment agreement must be signed by all of them. Further, you should list the transaction’s important financial facts, such as the sale price and who is responsible for paying the transfer costs. You can also include a clause outlining the process for resolving trade mark-related disputes, such as through mediation or arbitration.
Reporting
To submit your assignment application electronically, go to the IP Australia website. You can also print the forms and mail them along with your application. Go to the computerised application system and pick Transfer Notice from the drop-down menu. Follow the steps to finish the application. You must provide:
- the mark registration number;
- a summary of the mark; and
- the purchaser and seller’s contact information.
You can use a credit card, debit card, or electronic check to pay the filing fee.
All you need to record the assignment of a trade mark is the submission of an application with IP Australia, along with proof that the title to the trade mark has been transferred. This could include a copy of the deed of assignment or an extract from the sale of company contract. Assignments can be made against prospective or registered trade marks. Additionally, they can be made with or without the business’ goodwill. The assignment might also be limited in scope, referring solely to a portion of the products or services included in the request or registration. However, the assignment cannot be geographically restricted.
Taking care of the assignment or sale of trade marks is not always a time-consuming or expensive procedure, but leaving the trade marks to lapse can be exactly that.
Additional Points to Consider
Before you may sell your trade mark to someone else, you must first utilise it in business. The trade mark must be shown on specific items or services that you are selling and on all of your products as a corporate brand name. If you simply registered the trade mark as a holder for a future planned use, you cannot charge another person for the transfer.
Think About Licensing the Trade Mark or Intellectual Property Instead
Another option is to use a formal licence agreement, in which the owner of a trademark allows another party permission to use the mark under specific terms. This approach helps you maintain ongoing use of the trade mark (because if it is not used, you lose it). It also allows you an ongoing revenue stream.
What the parties include in the licence agreement is entirely up to them. Aside from having strong quality control rules, the agreement can include conditions such as:
- a licence price;
- where, when, and how the trade marks can be used; and
- who is liable for infringement claims, among other things.
Key Takeaways
Before deciding on how to sell your trade mark, you should consider:
- agreeing and negotiating a sale agreement between yourself and the purchaser;
- informing IP Australia of the transfer of the trade mark; and
- make sure you transfer all of the relevant trade marks for your business sale.
If you have any questions about how to sell your trade mark when selling your business or need trade mark legal assistance, contact our trade mark lawyers on 1300 657 423 or fill out the form on this page.
Frequently Asked Questions
Yes, you do need to register your trade mark sale with IP Australia.
Before you may sell your trade mark to someone else, you must first utilise it in business. The trade mark must be shown on specific items or services that you are selling, as well as on all of your products as a corporate brand name.