The present complicated rules about registered users and assignments are substantially relaxed.

Trade marks may be assigned, pledged or licensed, and also sub-licensed (which is not permitted under the existing law), in relation to all or some of the goods or services for which they are registered or applied.

Recording these transactions will be voluntary. Use by a licensee will be deemed use by the owner to protect marks against cancellation for non-use, irrespective of whether the licence is registered. There will, however, be a strong incentive to record "registrable transactions". Until an application has been made for recordal, they will be ineffective against a person acquiring a conflicting interest without notice of the unrecorded transaction. In addition, only a registered licensee will be able to sue for infringement. Furthermore, an assignee or licensee who fails to register a registrable transaction within six months will not be entitled to damages or an account of profits in respect of infringements occurring before registration.

Exclusive licensees will have the same rights as the owner to bring infringement proceedings but the owner may exclude these rights by contract.

The effect of the new licensing rules is to entrust the protection of a trade mark's goodwill to its owner; the Registrar will no longer have a duty to protect the public from deception. The need to protect goodwill in licensing is emphasised by a new ground for cancellation: that a change in the nature or quality of the goods or services on which it is used is liable to mislead the public. Quality control therefore remains the key to good licensing practice.

Further information on the above may be obtained via Linklaters & Paines Hong Kong office or via any of the other nine Linklaters & Paines offices world-wide, located in Singapore, Tokyo, London, Brussels, Paris, Frankfurt, New York, Washington D.C. and Moscow. Contact details for the various L&P offices worldwide are available via the Linklaters & Paines corporate listing c/o Business Monitor Online -

c Linklaters & Paines 1997 - Tel +852 2842 4888