Register trademarks early or face losses

PUBLISHED : Friday, 21 April, 1995, 12:00am
UPDATED : Friday, 21 April, 1995, 12:00am

HONG KONG firms should register their trade marks one to two years before they use them or face losing up to 50 per cent of their revenue to intellectual property thieves, a lawyer warns.

Martin Rogers, who is a commercial litigation solicitor with Herbert Smith, said firms should plan 'extremely well ahead' if they did not want their future profit margins severely eroded.

'If you're a company with a basket of brand names you've got to be looking one to two years ahead,' he said at a seminar on trade marks organised by Asia Law and Practice.

Mr Rogers said: 'You've got to ask yourself what countries am I going to be trading in a year or two's time and you've got to put the applications for the registration of trade marks in straight away.

'Otherwise, in the most extreme cases, you could lose anything up to 50 per cent of your business.' Mr Rogers said: 'Even in normal cases you're probably talking about five to 10 per cent of business, but where your overheads are high, that five to 10 per cent might be your entire profit margin.' Hong Kong firms needed to set about defending their intellectual property well ahead of time because the trade mark registration system in the territory was a long and drawn-out one.

While admitting it worked 'tolerably' well, he said 'my main concern from a lawyer's point of view is that it takes anything up to 12 months for a registration to be effected.

'You can't begin suing anybody until you've got registration, so for that 12-month period other people are able to take advantage of your product and it's unlikely you're going to be compensated for that.' He said if a company had its trade mark registered it could act against these infringers immediately, otherwise it might be forced to endure a costly waiting period.

Nigel Francis, a partner at Herbert Smith, said if trade marks were registered firms could obtain an injunction ordering those infringing to cease their activity, a move which could be costly.

While large companies could afford the expense, small ones might find the costs prohibitive.

An alternative was to enlist the aid of Customs and Excise which have an Intellectual Property Investigation Bureau responsible for the enforcement of criminal sanctions involving trade marks, trade descriptions and copyright infringement.