Two provisions do most of the work in Pakistani trademark licensing, and they pull in the same direction. Permitted use counts as the owner’s use, which is what keeps a licensed mark safe from a non-use attack. And an unrecorded licence leaves the licensee without the statutory protections — which is what makes recordal worth the administration.
Quick reference
| Formality | A licence is not effective unless in writing, signed by or on behalf of the grantor |
| Scope | General, or limited by goods or services, or by manner or locality of use |
| Successors | Binding on a successor in title unless the licence says otherwise |
| Sub-licences | Permitted where the licence so provides |
| Permitted use | Deemed to be use by the owner of the mark |
| Recordal | A registrable transaction; record it on the prescribed form |
| If not recorded | The licensee loses the protections the Ordinance gives |
| Madrid licences | Recording in the International Register has no effect in Pakistan |
The licence itself
Section 75 is short. A licence to use a registered mark may be general or limited; a limited licence may apply to some but not all of the goods or services, or to use in a particular manner or a particular locality.
A licence is not effective unless it is in writing signed by or on behalf of the grantor. Unless it provides otherwise, it is binding on a successor in title to the grantor’s interest. And where the licence so provides, the licensee may grant a sub-licence.
Two drafting consequences follow from that. If the parties want the licence to end on a sale of the mark, say so — the default is the opposite. And sub-licensing is not implied; if a distributor is expected to appoint sub-distributors who use the mark, the power has to be in the document.
Permitted use is the owner’s use
Section 74 is the provision that makes licensing safe.
Permitted use of a mark is deemed to be use by the owner, and deemed not to be use by anyone other than the owner, for any purpose for which such use is material under the Ordinance or any other law.
That is what protects a licensed registration. A mark used in Pakistan only by a local licensee is still being used by the proprietor for the purposes of revocation for non-use and for the evidence of use the Registrar may require from the second renewal onwards.
Section 74 also directs where the benefit of use goes. A tribunal deciding whose benefit it is must pass it to the registered proprietor, or to the owner of a mark entitled to protection under the Paris Convention as a well-known mark — and to nobody else.
The practical implication for a licensor is to make sure the use is genuinely attributable: that the licence exists in writing, that the licensee’s use is within its terms, and that the licensee’s invoices, packaging and advertising can be produced when the use has to be proved. A licence that exists only as an informal arrangement with a distributor produces use that may be difficult to claim as the proprietor’s.
Recording a licence
A licence is a registrable transaction under section 70, and the consequence of not recording it is set out in the same section. Until an application has been made to record the prescribed particulars, the transaction is ineffective against a person acquiring a conflicting interest in ignorance of it, and a person claiming to be a licensee does not have the protections the Ordinance would otherwise give.
The application to register a person as a registered licensee is made by the licensee and the registered proprietor together, on the prescribed form. The entry records a defined set of particulars:
- the registration number and class;
- the name and address of the registered proprietor;
- the name and address of the registered licensee;
- the goods for which the licensee is registered;
- the address for service;
- whether the licensee is exclusive or non-exclusive; and
- whether the permitted use is for a specific period or without limit of period.
A few points follow from that list. The entry is public, which is sometimes a commercial consideration. The exclusivity and the term are recorded, so a confidential arrangement is not wholly confidential once recorded. And because the entry is per registration, a brand licensed across four classes needs four recordals.
Variation and cancellation. The registration of a licensee can be varied on application, accompanied by a statement of grounds and, where the licensee consents, their written consent. It can be cancelled on application on the prescribed form. Where the licensee was registered for a period, the Registrar cancels the entry at the end of that period. Where goods are removed from the registration, they are removed from the licensee’s entry at the same time, and the Registrar notifies everyone affected.
Intervention. The Registrar notifies cancellation applications to the proprietor and to each registered licensee who is not the applicant. Anyone so notified who wants to intervene has one month from receiving the notification to give notice and a statement of grounds. If you hold a licence that depends on the registration, that one month is a deadline worth diarising the moment a notification arrives.
When a licensee can sue
Section 77 gives an ordinary licensee a route into enforcement, but an indirect one.
Unless the licence provides otherwise, a licensee is entitled to call on the proprietor to take infringement proceedings in respect of any matter affecting the licensee’s interests. If the proprietor refuses, or fails to do so within two months of being called upon, the licensee may bring the proceedings in their own name as if they were the proprietor.
Where a licensee brings proceedings under that section, they may not proceed without the leave of the court unless the proprietor is joined as a plaintiff or added as a defendant — though that does not prevent interlocutory relief on an application by the licensee alone. A proprietor added as a defendant is not liable for costs unless they take part.
And in proceedings brought by the proprietor, any loss suffered or likely to be suffered by licensees is taken into account, with the court able to direct how far the proprietor holds the proceeds of a monetary remedy on the licensees’ behalf.
For a licensee, the practical reading is that the two-month call-on mechanism is the lever. It should be used in writing, early, because it starts the clock that eventually allows the licensee to act alone.
Exclusive licences
Section 76 defines an exclusive licence as one authorising the licensee, to the exclusion of all other persons including the grantor, to use the mark in the manner authorised. An exclusive licensee has the same rights against a successor in title bound by the licence as against the grantor.
Section 78 goes further. An exclusive licence may provide that the licensee has, to the extent stated, the same rights and remedies as if the licence had been an assignment for matters occurring after the grant. Where it does, the licensee may bring infringement proceedings in their own name against anyone other than the proprietor, with rights concurrent with the proprietor’s, and the defendant may rely on any defence that would have been available against the proprietor.
That is a drafting opportunity that is often missed. The right does not arise automatically from exclusivity; the licence has to say so. An exclusive distributor who expects to be able to enforce without the brand owner’s participation needs that provision in the document and the licence recorded.
Madrid licences do not reach Pakistan
Pakistan declared, on joining the Madrid Protocol, that recording a licence in the International Register has no effect in Pakistan. A licence relating to an international registration must be recorded in the national Register, with the formalities completed directly with the Pakistani office under Pakistani law.
A group that centralises licence recordals through WIPO therefore has an unrecorded licence in Pakistan, with the section 70 consequences attached. See the Madrid Protocol and Pakistan.
Quality control
The Ordinance defines an authorised user as a person authorised to use the mark under the control of the owner. That word is doing more than describing a relationship.
Control is what makes the licensee’s use attributable to the owner, and it is also what protects against the two revocation grounds that turn on how a mark is used — becoming the common name in the trade, and becoming liable to mislead the public as to nature, quality or geographical origin. Those grounds look at the use made by the proprietor or with their consent, which includes licensed use.
So quality control provisions are not boilerplate. A licence that grants use without any mechanism for supervising it exposes the registration to the conduct of the licensee.
Frequently asked questions
Does a trademark licence have to be in writing in Pakistan? Yes. A licence is not effective unless it is in writing signed by or on behalf of the grantor.
Does licensed use keep my registration alive? Yes. Permitted use is deemed to be use by the owner of the mark, so use by a licensee counts for non-use purposes and for the evidence of use the Registrar may require at renewal.
What happens if I do not record a licence? The licensee does not have the protections the Ordinance gives, and the transaction is ineffective against a person who acquires a conflicting interest in ignorance of it.
Can a licensee sue for infringement? An ordinary licensee can call on the proprietor to sue and, if the proprietor refuses or fails to act within two months, may bring proceedings in their own name — generally with the proprietor joined. An exclusive licensee can have assignee-level rights, but only if the licence expressly provides for them.
Does a licence recorded at WIPO cover Pakistan? No. Pakistan declared that recording a licence in the International Register has no effect there; it must be recorded nationally.
Does a licence survive a sale of the mark? Yes, unless the licence provides otherwise. It is binding on a successor in title to the grantor’s interest by default.
Useful official resources
- Intellectual Property Organization of Pakistan — recordal forms and fees
- Trade Marks Ordinance, 2001 — sections 70, 74, 75, 76, 77, 78
- Trade Marks Rules, 2004 — rules 63 to 66
See our related notes on trademark assignment in Pakistan, the Madrid Protocol and Pakistan and renewal and restoration.
Licensing a brand into Pakistan, or holding a licence you are not sure was ever recorded? Talk to us.