Can I Sell My Trade Mark?
Like any other property, you can buy and sell trade marks. However, since trade marks are intangible, it is important for trade mark owners to understand the processes involved in selling their trade mark to ensure that the sale goes to plan. This article will outline:
- what a registered trade mark is;
- how to sell a registered trade mark;
- the consequences of selling your trade mark; and
- other options available when dealing with trade marks.
What Is a Registered Trade Mark?
A trade mark is a type of intellectual property that protects your business brand. Registered trade marks provide business owners with the exclusive right to use, license and sell their trade mark. Nowadays, trade marks protect a range of things such as:
- your business’ logo;
- your business’ unique catchphrase;
- a distinctive colour used by your business; or
- an aspect of a product’s packaging.
How to Sell a Trade Mark
Since trade marks are associated with a particular product or service, they are usually sold along with the business or with the particular product that the trade mark protects.
For example, if you sell your business, you can also sell your trade mark rights to the logo of the business.
Under Australian trade mark law, selling a registered trade mark requires an assignment. An assignment is the process of registering a change in ownership of the trade mark. You can complete this registration process online via IP Australia. You will need to fill out a number of documents. These include:
- an assignment request form; and
- evidence of assignment.
The assignment request form requires:
- your personal details and signature;
- your position as the current owner of the trade mark;
- the details and signature of the buyer; and
- the number which identifies the trade mark you are selling.
The evidence of the assignment can include a:
- signed letter of assignment; or
- sales agreement.
You can find and complete both of these documents online via the IP Australia website.
The Consequences of Selling Your Registered Trade Mark
Before you sell your trade mark, it is important to understand how selling your trade mark will affect your exclusive rights to use the trade mark. When you sell your trade mark, you no longer own the trade mark. Instead, the trade mark becomes the personal property of the new owner who can then use it to distinguish their goods and services.
Why Might Trade Mark Owners Sell Their Trade Mark?
Selling a trade mark can be useful for a number of reasons. The sale of a trade mark often occurs when:
- businesses are sold; or
- a unique trade marked product is sold to another person.
When selling a business and its associated trade marks, the value of a trade mark often indicates the goodwill of the business.
Goodwill is an intangible asset to a business that includes the business’ reputation and customer loyalty.
It is important to take the value of a business’ goodwill into consideration when selling a trade mark, as this can largely determine the sale price of the trade mark. The value of a trade mark can also depend on the market value of other trade marks and future income-based valuations.
Other options are available if you seek to maintain some ownership over the trade mark. Some of these options are set out below.
If you are not selling your business, licencing your trade mark might be a more viable option. Licencing grants another person the right to use and exploit your trade mark without taking ownership of your trade mark.
For example, an independent franchisee of a fast-food company would likely have a licence to use the fast-food company’s logo.
You can licence trade marks on conditions that you and another person agree upon. They can also be more profitable than a one-time sale of a registered trade mark, since there is the potential to receive multiple payouts over the licencing period.
Partially assigning ownership is another way to ensure you maintain some form of ownership over your trade mark. Partially assigning your trade mark means that you do not lose ownership of your intellectual property. Rather, other owners can also use the trade marked property. This could be useful if you wish to enable other owners of a business or a family member to also enjoy property rights over the trade mark. The process for partially assigning a trade mark is similar to the complete transfer of ownership detailed above.
It is important that trade mark owners understand the process involved in selling a trade mark to ensure that the sale runs smoothly. Selling a registered trade mark requires registering the transfer of ownership with IP Australia. As a consequence of selling a trade mark and completely transferring ownership to the buyer, you can no longer use the trade mark. If you require more trade mark legal assistance, contact our experienced trade mark lawyers on 1300 657 423 or fill out the form on this page.
Frequently Asked Questions
It is much easier to sell a registered trade mark rather than an unregistered trade mark. An unregistered trade mark, identified by the ‘™’ symbol, does not enjoy the same protections under trade mark law as registered trade marks do.
There is no specific time limit of using your trade mark before selling. A registered trade mark lasts 10 years from its filing date and this can be renewed. However, you must actively use your trade mark in the course of trade or else it can be removed for non-use.
The value of a trade mark largely depends on the business associated with the trade mark. Factors that are taken into account when determining the value of a trade mark include customer recognition, the longevity of the business and the market value of similar trade marks.