Over the last few decades, the world economy has witnessed a paradigm shift as far as transaction of goods and services are concerned. Companies have expanded their business operations and established their manufacturing units across the globe and services have traversed boundaries, which has in effect led to the upswing of branding. Intellectual property plays a pivotal role in the trade related aspects and trademark law in such cases comes into play when issues regarding registration of mark and ‘use’ of mark in the country of origin or country of export are under dispute. The Indian position is clarified under Section 56 of the Trade Marks Act, 1999 which, in unequivocal terms, states that if the goods to be exported or services rendered are outside India and trademark is branded in India, then for the purposes of Indian law, that mark is said to be used in India.

What amounts to use?

Section 2(2)(b) of the Act provides that any reference to the use of the mark shall be construed as a reference to the use of printed or other visual representation of the mark. Thus, use of a mark in relation to goods will include use of the mark upon the goods physical or in any other relation to such goods. In case of services, any statement regarding the availability, provision or performance of services will constitute use of the mark.   

Trademark-Illustrations

Goods – For instance, A is an Indian company manufacturing a product solely for the purpose of exports. Few likely situations that can be envisaged are, one in which the product is being manufactured in India and also branded/applied in India itself and the other where the product only is manufactured in India; this can even include an international brand wherein the product is not branded in India and the mark is applied in the country to which it is being exported.

In the former case, the use of the trademark is in consonance with Section 56 and thus, comes under its ambit. The definition of ‘use’ in light of the above illustration, will lead us to infer that the manufacturing/branding of the goods essentially requires a representation of the mark in a printed or visual mark. In other words, there should be application of the mark in India for it to be considered as ‘use’. In the latter scenario, since they are unbranded goods, there is no ‘use’ of the mark in connection with a particular trademark or trade-name and thus, it may not fall under the purview of Section 56.

Services – The best example can be that of a back office or a BPO through which services are rendered but there is no principal place of business in India. In such cases, going by the definition, there will be ‘use’ of the trademark if there are advertisements (availability) or any links to the functioning of the Indian office on the official website (performance). The interesting question is whether use of the mark on invoices be regarded as ‘use’? Since, the services are being rendered for the company that is not situated in India, it is not likely that the invoices would be in the name of the Indian counterpart, so it may not fall under the ambit of the ‘use’.

Recommendation

Continued use of a trademark even after termination of a license agreement is not unheard of. In such cases, if the trademark holder has not registered the mark in India, the only remedy available is that of passing off. Therefore, it is highly recommend that trademark owners get their trademarks registered in India for two reasons – to ensure that their mark is adequately protected because it is being used in India and also to prevent other people (licences after expiry of the agreement) from using their trademark.

So, if you’re manufacturing a product in India even if it is only for sale outside India, or if you have a BPO or an outsourcing outfit in India, it would be advisable for you to file and protect the trademark in India.

This article has been authored by Nikita, an IP Law practitioner.