Imagine a well-known ice cream brand deciding to enter India, and discovering its name already sits on the register in someone else’s name. The options are to litigate or to pay. Neither is what anyone budgeted for.
How squatting works
The pattern is consistent: someone registers a brand in a jurisdiction before its owner does, then relies on that registration to extract a payment or block entry.
IKEA in Indonesia is the standard illustration. A company named Intan Khatulistiwa Esa Abadi — an acronym that conveniently produced IKEA — registered the mark in 2013. IKEA had registered there in 2010, but had failed to use the mark for three consecutive years for commercial purposes, and its registration was cancelled under Indonesian law on that ground.
That case is worth reading carefully, because the lesson is not simply “file early”. IKEA had filed. What defeated it was non-use — a registration held defensively, in a jurisdiction with a three-year non-use period, without commercial activity behind it.
Burger King in India presented the other pattern: a domestic fast-food chain challenging the American brand’s registration dating to 1979, on grounds of non-use and its failure to oppose the domestic chain’s own application.
Is India a safe haven?
The concern is usually framed this way: India allows registration on a “proposed to be used” basis, without proof of use at filing, which creates room for speculative registrations.
That is true as far as it goes, but the framing understates India’s protections considerably. India is not a pure first-to-file jurisdiction:
- Section 34 protects a prior user. A registered proprietor cannot interfere with the use of an identical or similar mark by someone who used it before the proprietor’s use or registration, whichever is earlier. Prior use beats registration.
- Well-known marks are protected across classes, irrespective of registration or use in India.
- Trans-border reputation is recognised — though since Toyota v. Prius (2018) it requires proof of actual goodwill among Indian consumers, not merely global fame.
- A “proposed to be used” filing creates no enforceable rights without a genuine intention to use, as the Madras High Court confirmed in the 7-Eleven “Big Bite” dispute.
- Non-use exposes any registration to cancellation after five years and three months.
So a squatter’s registration in India is vulnerable from several directions at once. What it is not is free to overcome — and that is the real problem. Challenging a squatted registration means rectification proceedings, opposition, or litigation, all of which are costly and slow, and all of which a brand must fund before it has earned a rupee in the market.
What to do instead
- File early in emerging markets, including those you have not entered yet. Cultural reach outruns commercial presence, and squatters watch for exactly that gap.
- Use the mark, or be able to show intention to. As IKEA found, a defensive registration with nothing behind it is not secure.
- Monitor the registers in your key territories, so a squatter’s application meets an opposition — far cheaper than a cancellation years later.
- Build the well-known mark record: evidence of reputation, recognition and consumer association, assembled before you need it.
The brands that come off worst are those that were famous before they were filed — recognisable enough to be worth squatting, without the registrations to match.
The takeaways
- Squatting exploits gaps between fame and filing, not gaps in the law.
- IKEA lost on non-use, not on filing late — a defensive registration is not enough.
- India protects prior users under Section 34 and well-known marks across classes.
- The cost is the real exposure — challenging a squatter is slow and expensive.
Frequently asked questions
Is India a first-to-file country for trademarks? Not purely — registration follows filing, but Section 34 protects a prior user against a registered proprietor, and well-known marks are protected irrespective of registration.
Can a squatter’s registration be removed? Yes — through rectification or cancellation, including on grounds of non-use after five years and three months, or bad faith. The difficulty is cost and time, not the legal basis.
Why did IKEA lose its mark in Indonesia? Because it had not used the mark commercially for three consecutive years, allowing cancellation under local law despite having registered earlier.
How can a brand prevent squatting? File early in markets it may enter, keep marks in genuine use, monitor local registers, and oppose speculative applications when they publish.
Useful official resources
- The Trade Marks Act, 1999
- WIPO — Madrid System