A trade name is the name of a business. Businesses can use one or more trade names. A trade name is used both offline and online; the trade name is not only on your shop front, it is also used on your websites and social media accounts. If the name is also used to distinguish products, it also acts as a trademark.
Trade names. What are they?
According to the law, a trade name is the name under which a business is operated. The business represents itself in commerce by using a trade name. A business often focuses on a particular audience in this context, among whom, over time, the trade name builds up recognisability worth protecting. Trade names may not be misleading to the public. Trade names are protected against the danger of confusion.
A trade name is inherently linked to your company’s assets (such as your client file and/or domain name), which have often required years of investment. A trade name is therefore not often operated entirely separate from the business and can therefore not often be easily transferred on its own. In the context of franchise constructions, a licence may be granted to use a particular trade name. Royalties must often be paid in order to operate a trade name.
Trade names. How do you register them?
Pursuant to the Trade Names Act, it is not necessary to register a trade name. (The Trade register legislation stipulates that Chamber of Commerce registration is required for other reasons in specific cases.) Protection under trade name law is acquired by actual use of the trade name. A Chamber of Commerce registration itself is not sufficient for the owner of a trade name to oppose infringement of the trade name.
The use of a trade name often takes place in one or more specific sectors or is focused on a specific public. The purposes for which you use your trade name(s) are decisive for what protection can be derived from it.
Trade names. What protection do they provide?
If a third party uses the same trade name (or one that is only slightly different) and it is feared that this will cause confusion among the relevant public, the owner of the trade name can take action against this. If there is a danger of confusion, the assessment of which involves a consideration of all circumstances of the case, the judge will impose an injunction against use of the newer trade name.
If a third party uses a newer trademark that resembles an older trade name, this also constitutes an unlawful act. It is also prohibited to use a trade name which contains another party’s trademark. The judge ultimately decides during legal proceedings whether the trade name laws or trademark laws have been infringed.
Would you like to know more about trade name law?
The lawyers at Dirkzwager regularly advise and litigate in cases concerning trade names, domain names and trademarks. We also provide legal assistance during proceedings on trade name infringements. We are also specialised in drawing up contracts to transfer or grant licences for the use of trade name rights.
Contact our law firm if you have questions about trade name law or need immediate advice or legal assistance.
By Joost Becker