Trademarks: Valuable assets in a changing world

July 2009

From the shopping mall to the local hardware store, we are exposed every day to a stunning array of trademarks – distinctive signs that transmit a myriad of subliminal messages relating to authenticity, origin, quality, reliability, prestige, advantage – that scramble for consumers’ attention, whispering “buy me, I am better than the competition. I am what you need!” Trademarks and the legal protection they afford play a pivotal role in commerce. On the one hand, they contribute to market order by defining various important rules of business and on the other, they help consumers in their buying decisions.

Extremely valuable assets, even in tough economic times, trademarks strongly influence purchasing behavior as consumers make more careful decisions, often reverting to “tried and trusted” brands. So in good times and bad, investing in trademarks and brand development makes sound business sense. Trademarks and the legal rights associated with them underpin the complex network of licensing and franchise agreements that can be the source of highly lucrative revenue streams.

As an increasing number of companies enter the international arena, and the electronic marketplace expands, recognition of the importance of securing trademark rights has risen. In this context, companies must be able to register marks and manage trademark portfolios in a timely and cost-effective way.

Advantages of the Madrid System

WIPO’s international trademark System is an affordable, user-friendly and attractive option for companies seeking trademark protection in a large number of countries. The System has several advantages for trademark owners. By simply filing one application with WIPO (through one’s national or regional trademark office), in one language (English, French or Spanish) and on payment of one set of fees, it is possible to obtain an international trademark registration. The System is a cost-saving alternative to filing multiple national applications in each of the countries in which protection is sought – a complex process involving several different languages, different national procedural rules and regulations as well as different (and often higher) fees and currencies. While the System is not a substitute for securing trademark rights in the country of origin, it facilitates the process of protecting national trademarks abroad, acting as a legal bridge between national and global marketplaces.

The Madrid System also supports judicious management of company trademark portfolios by offering the possibility to renew a registration every 10 years through a straightforward, streamlined procedure. Additionally, if a given international trademark registration changes hands, is assigned to a third party, or if there are other changes in the holder’s details (such as a change in name and/or address), this is recorded centrally through a single procedure and has effect in all designated contracting parties.

Throughout the Madrid System’s 118-year history, WIPO and its stakeholders have fostered its development to ensure it keeps pace with evolving user needs and continues to offer value for money. The geographical expansion and sustained growth of the System – with 84 contracting parties (83 countries and the European Community), and a robust 5.3 percent growth rate in 2008 – point to both the commercial importance of trademarks and the continued relevance of the System.

Enhancing Madrid services

Recognizing the need to further enhance the scope and quality of Madrid services, WIPO is rolling out a comprehensive modernization program that will ensure users are able to benefit from a highly efficient, modernized information technology (IT) infrastructure. The IT modernization program, costing some 15.3 million Swiss francs, was launched in 2008 and is due for completion in 2011.

According to WIPO Assistant Director General Ernesto Rubio, in charge of trademark operations, “WIPO is committed to the progressive development of the Madrid System.” He adds, “Our aim is to continue to deliver value-added services that meet the evolving needs of the business community.” In addition to ongoing discussions on the feasibility of expanding the linguistic range of the System – which currently operates in English, French and Spanish – various other initiatives are in the pipeline.

These include a change to the Common Regulations whereby, as from September 1, 2009, designated offices will provide holders of a registration with a statement of grant of protection. According to Mr. Rubio, “This is a major improvement as, instead of having to wait for the end of the refusal period to be sure where they stand, holders will have, earlier on in the process, a clear picture of the status of their international trademark applications. Thiswill provide early legal certainty and thereby help boost business confidence.”

Mr. Rubio also referred to a number of other new services currently under development. n particular, he pointed to an electronic trademark classification tool designed to serve as a failsafe mechanism to avoid delays in processing applications where erroneous classification of goods and services are indicated. The first edition of this e-classification validation tool – expected to be available shortly in English, French and Spanish – will consist of approximately 27,000 descriptions of goods and services. The new service will enable users to browse and select from a list of “accepted” terms that conform to international trademark classification standards, thereby assuring users that no irregularity notice will be issued by WIPO. The tool further offers applicants the possibility of verifying their own descriptions and categorization of goods and services against accepted terms and selecting the most appropriate ones for their purposes. The service also includes an automatic translation facility in all filing languages (English, French and Spanish). This new product promises to iron out a large number of the glitches that can arise in the application process, making registration smoother and speedier.

Mr. Rubio also pointed to the development of a new “hands-on” secure electronic trademark portfolio management system that will allow trademark holders or their representatives to track progress of their application and the status of their mark more closely.

These new options are due to come online progressively after a trial run with a limited number of trademark attorneys over the coming months. It is expected that elements of the service will be made available to the broader trademark community during the fourth quarter of 2009. According to Mr. Rubio, they “promise to generate important practical benefits for trademark owners by facilitating the registration process and the management of their trademark portfolios. They further promise to generate efficiencies in the delivery of trademark services.”

In today’s challenging economic times, astute and strategic management of trademark rights is more important than ever. The Madrid System for the International Registration of Marks is a smart business solution for any company seeking an efficient and cost-effective way to develop and manage its trademark portfolio.

By Cathy Jewell, Media Relations Section, WIPO

The WIPO Magazine is intended to help broaden public understanding of intellectual property and of WIPO’s work, and is not an official document of WIPO. The designations employed and the presentation of material throughout this publication do not imply the expression of any opinion whatsoever on the part of WIPO concerning the legal status of any country, territory or area or of its authorities, or concerning the delimitation of its frontiers or boundaries. This publication is not intended to reflect the views of the Member States or the WIPO Secretariat. The mention of specific companies or products of manufacturers does not imply that they are endorsed or recommended by WIPO in preference to others of a similar nature that are not mentioned.