Everyone knows or at least has a general idea of what a trademark means and what its main purpose is. But how does a trademark actually work in practice and what are its main advantages? In which cases should entrepreneurs not neglect to register a trademark and how to choose it correctly? The answers to these questions, as well as other important practical information regarding trademarks, can be found in this article.
Trademarks in general
A trademark is one of the types of industrial property and is an instrument used to legally protect a brand – it is a registered sign the main purpose of which is to distinguish the products or services of a particular person from those of competitors. Typically, it may be a distinctive word, a short slogan, a picture, a logo, or a combination of the above. However, a trademark can also be, for example, a mere characteristic color, the shape of a product (a spatial trademark), or even a sound.
In order to be considered a registrable trademark, such a sign must fulfill the necessary statutory definitional features, in particular the so-called distinctive ability and the ability to be objectively expressed (reproduced) in the trademark register. In order to achieve its purpose, every trademark should ideally also have other characteristics, in particular, originality and easy memorability and permanence in time. The competent authority for registration of a national (Czech) trademark is the Czech Industrial Property Office; if the applicant decides to protect their sign at the European or international level, registration is made with the European Union Intellectual Property Office (EUIPO) or the World Intellectual Property Organization (WIPO).
The importance of a trademark in business
The significance of a trademark may not be obvious at first glance, which is why entrepreneurs quite often do not pay enough attention to its acquisition. In doing so, however, they may be missing out on a number of key benefits of trademark registration and exposing their business (and in particular their hard-built brand) to increased risks.
I. Securing the exclusive right of use
One of the main advantages of a trademark is to ensure the exclusivity of the use of the relevant sign within the market of specific goods and services. Thus, the owner becomes the exclusive authorized user of the sign in connection with the goods and/or services for which the trademark has been registered; no one else may use any other identical or similar sign for the same or similar product or service in the territory for which the trademark is registered (e.g. the Czech Republic in the case of a national trademark or the entire EU in the case of a European trademark). Moreover, the entrepreneur can prove their exclusive right of use very easily by means of an extract from the trademark register or a certificate of registration.
However, if an entrepreneur chooses to use only an unregistered sign in the course of their business, such a privileged position is by no means guaranteed. While a certain degree of legal protection is afforded to an unregistered sign, in particular through the unfair competition institute enshrined in the Civil Code, it is often insufficient when another undertaking using the same or a similar sign appears in the competitive field. In such a case, the entrepreneur is forced to prove their rights to the sign in the dispute, e.g. they must prove that they have used the relevant unregistered sign before, that consumers associate such a sign with their business, etc., which is often very difficult and administratively burdensome.
These difficulties are eliminated in the case of a trademark, since the exclusive right of the owner to such a registered sign is invariably derived from the public register, even if the entrepreneur has not yet begun to use the sign. In the event that the rights in relation to the use of the registered sign are infringed, the trademark offers the entrepreneur an effective defense in the form of the right to require the infringer to remedy the infringement, to pay damages, to compensate for unjust enrichment and, where appropriate, to seek appropriate compensation.
II. Differentiation from competitors
In view of the ever-increasing competition in individual sectors, very similar products and services are often created, making it difficult for ordinary consumers to navigate the market and, in particular, to easily identify a particular producer or service provider. Consumers distinguish between competitors and the goods and services they distribute mainly based on how they are labeled, i.e. by their logo, name, or other specific features.
In this respect, a well-designed and distinctive trademark is an effective tool for clearly identifying and distinguishing the products or services of the owner of the trademark from other, often similar (and therefore easily confused) products and services of other entrepreneurs.
Through a registered and properly marketed trademark, an entrepreneur not only becomes much easier to identify but, if the trademark is well-designed, can gain a strong position in the market. Ideally the entrepreneur will be so associated with its registered sign in the eyes of the consuming public that they will not have to worry about their products or services being mistakenly associated with other competitors in the future.
III. Effective promotion and marketing value
Of course, a trademark also has a promotional value; by introducing its own, uniform, and, as far as possible, “catchy” mark for its products, an entrepreneur increases the chances that their products or services will become known to a wide range of consumers. In addition, the business may use the Ⓡ symbol, i.e. ‘registered’, as part of the promotion to indicate that the relevant sign is registered and protected.
In the context of promotion, the marketing value of a trademark cannot be overlooked, as it helps the entrepreneur to define the corporate image and reputation of the products or services, playing an important role in creating trust, which is the basis for building a loyal client base and improving the reputation of the business. In practice, it has been shown that a protected sign tends to be perceived by the public as more solid and trustworthy than an unregistered sign. In addition, registration in the trademark register automatically implies a certain “stamp of quality,” which can give the business a competitive advantage.
IV. Preventing the loss of investments or original ideas
Building a business involves not only large-scale investments but also the generation of creative ideas that are of significant value to the entrepreneur because they are usually backed by long-term efforts. Such investments and efforts can also be spent in connection with the creation of an original label or the entire “brand” identity of a company.
As already mentioned above, by registering a trademark (whether in word, graphic, combined, or another form, ideally in all the variants used), the entrepreneur significantly strengthens their position in the event of the emergence of subsequent confusing signs or unauthorized attempts to parasitize the established business identity. In addition, the registration of a trademark has an important preventive effect as well. Every serious entrepreneur usually wants to do some checks before launching a new brand, especially to see whether someone with a similar mark may have already “outrun” him on the market. Usually the first step is to search the database of valid trademarks. Registering a trademark therefore helps to prevent a situation where a new player enters the market (possibly even unknowingly) with a similar mark in which they have already invested considerable resources – in such cases, it is very difficult to resolve the situation.
In this way the trademark also acts as an effective form of prevention to save the brand from losing value and becoming the subject of a costly dispute.
V. Unlimited protection
Another major advantage is that a trademark can provide the relevant business with protection for possibly unlimited period of time, as long as it is used. Although the registration period is limited to 10 years, the owner has the right to renew it for a further 10-year period, repeatedly and without limitation, for a modest fee.
Who should consider a trademark
Both legal and natural persons are entitled to file a trademark application. Generally, however, a trademark provides protection to its owner only in commercial dealings and can benefit any type of business activity, i.e., large and small companies as well as individual entrepreneurs. Thus, registration of a trademark can be recommended to virtually any business interested in building and protecting its brand.
Nowadays, a significant benefit of a trademark can be seen especially in the market of emerging start-ups, through which entrepreneurs usually come to the market with innovative and novel ideas, which are often very successful with the public. Among other things, a registered trademark is a signal of credibility for potential investors and increases the chances of obtaining financial resources.
What can be protected
More or less any sign that is objectively perceptible by the senses with sufficient clarity and precision can be registered as a trademark. This is a fundamental change from the period before 2019 when such a sign always had to be graphically representable.
The entrepreneur is therefore not limited in his choice of a sign and can use less common and unconventional types in addition to various combinations of pictorial, graphic, and verbal elements. Thus, an entrepreneur does not have to take the classic route and register, for example, the name of a company, a product, or a logo as a trademark, but can also associate their business with a specific sound or a multimedia jingle, for example.
When is the right time
It is never too late to apply for a trademark unless someone else has already been quicker to apply for the same or similar sign (for a similar range of goods and services). Therefore, before filing an application, it is worthwhile to conduct a search of the database of trademarks valid in a given territory (typically the Czech Republic) to make sure that the applicant’s efforts are not doomed to failure from the outset. Otherwise, however, it is possible to apply for a trademark at virtually any time, although the earlier the better.
Since a trademark can be used to protect a sign preventively, i.e. before use, it is advisable, especially for start-ups, to register a trademark as early as possible, even before the product or service is placed on the market.
How to select a trademark
In order to be eligible for registration as a trademark, a sign must have the aforementioned distinctive ability, which also means that the sign must not be too descriptive in relation to the products or services for which it is being registered.
Beyond the strict statutory requirements, it can be recommended that the mark should be as original, distinctive, and therefore easily remembered, as possible. An entrepreneur should not underestimate this stage but, on the contrary, should carefully consider the final form of the trademark. It is a common misconception in practice that a trademark should have a clear meaning or communicate some factual information about the products and services in question. On the contrary, the strongest and most distinctive trademarks are usually the so-called “fantasy” trademarks, i.e. completely fictitious signs, especially those that have no meaning in ordinary language. Word elements that, although common, have no obvious connection to a particular product or service can also be highly distinctive. A typical example is the American company Apple, whose activities have obviously nothing to do with apples. The assessment of the distinctive character of a trademark is thus always primarily a question of context and connection with the specific protected goods and services.
Businesses should, on the other hand, avoid generic and descriptive signs, especially those that are characteristic of a particular product or service. Furthermore, the designation must not be contrary to good morals (e.g. must avoid vulgarisms), misleading, or made up of national flags or religious symbols, names and symbols of intergovernmental organizations, geographical indications of origin, etc.
At the same time, as already mentioned, it is important to bear in mind the existence of earlier trademarks, and therefore, when choosing a suitable trademark, it is essential to first carry out a thorough search in order to determine whether such or other similar signs have already been applied for (within the territory) by a third party for the same or similar product or service. This can be done, for example, by using the database of the Industrial Property Office or the TMview register, which can be searched according to various criteria.
At the same time, it is necessary to check, by a market research or at the very minimum by using a web search engine, whether the sign in question is already being used on the market for similar products or services by another person, even if it is not registered. In such a case, a third party could prevent the registration of the trademark if it could prove that the sign had been in wide use before the application was filed.
Taking care of a trademark
Successful registration of a trademark does not mean that the owner is protected forever and does not have to take care of their rights. First of all, the owner should actively use the trademark in their business activities for all registered goods and services. If the trademark is left “unattended” for more than five years, anyone can force the trademark to be removed from the register for this reason.
At the same time, the owner should monitor the public database and keep an eye out for any new competing applications that might interfere with their trademark; the time limit for filing an opposition to any new trademark application (typically due to its similarity to an earlier registered trademark) is only three months from the publication of the application; after that, the registration of the new trademark cannot be prevented, although there are other (but more demanding) ways to invalidate a registered trademark after the fact. Last but not least, the owner should keep an eye on the ten-year expiry date of the trademark and secure an extension in good time.
We believe that after reading this article, you will agree that the increase in protection and prestige of your brand, which the trademark allows, makes sense for business and is definitely worth investing in (especially since the investment is rather modest; for example, the basic administrative fee for a Czech trademark application is currently only CZK 5,000).
In case of any questions in connection with trademarks or in case you need help with their registration, application and monitoring of related rights, please do not hesitate to contact us at any time.
 Currently, a mere characteristic sound, a recorded sequence of movements, a multimedia recording, etc. can constitute a trademark. In practice, however, these “exotic” types of trademarks are rather rare and the classical word, figurative, or combined trademarks continue to prevail.
 Failure to do so may result in great inconvenience if the owner of an earlier similar mark files an opposition to the application; however, that would be a topic for a separate article.
 You will pay a much higher amount for a European or international trademark application, but this is where the EU Commission’s grant program, announced again this year, comes in for small and medium enterprises, through which it is possible to apply for, inter alia, reimbursement of the costs of trademark fees of up to 75% of the application fee.
Mgr. Kateřina Lansdorfová, junior lawyer – firstname.lastname@example.org
JUDr. Tadeáš Petr, partner – email@example.com
23. 01. 2023