Australia: Selling or Winding up your Business - Don't Forget your Trade Marks

Considering the assignment or transfer of your trade marks should be on your checklist of things to do.

A common mistake made by trade mark owners during the sale or winding up of a business is failing to realise the value of the trade marks owned by the business and the potential need to assign this intangible property in the same way as other tangible assets such as plant and stock. For example, if a company is wound up without the relevant trade marks being assigned, it can be very difficult (sometimes impossible) and costly to rectify this.

A trade mark can be assigned in a number of ways including by way of a sale of business contract or by way of a separate deed of assignment. Once a trade mark(s) is assigned, it is important to promptly record the assignment with IP Australia so that the Trade Marks Register reflects the current owner of the trade mark(s). The rights of a new owner will be particularly affected if infringement proceedings are commenced as they will not be able to obtain relief until the assignment is formally recorded with IP Australia.

Recording the assignment of a trade mark(s) is a simple process involving the filing of an application with IP Australia together with evidence that the title to the trade mark(s) has been assigned or transmitted, for example a copy of the deed of assignment or an extracts from the sale of business contract. Assignments can be recorded against pending or registered trade marks, and can be transmitted with or without the goodwill of the business. The assignment can also be partial in the sense that it may only relate to some of the goods/services covered by the application or registration. The assignment cannot, however, be geographically limited.

Attending to the assignment or transfer of trade marks does not have to be a very costly or time consuming process, but allowing the trade marks to be left behind can turn out to be just that.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.