How to Transfer Trademark Ownership in India

In India, the owner of the trademark can transfer his rights either by assignment or by licensing. The Indian Trademarks Act, 1999 deals with both these mechanisms.

Trademarks are assets, and just like any other asset (land and building), they can be sold, transferred or licensed by the owner of the mark, in accordance with the legal procedures laid down under the Trademarks Act, 1999. 'Assignment of Trademark’ means that the ownership (as agreed upon in the transfer agreement) of the mark is transferred absolutely from one person to the other. For instance, when Walmart bought Flipkart, it included the transfer of intellectual properties, including trademarks. So, in this case, the ownership of the marks would have changed. In the case of ‘licensing of a mark’, the ownership and the right to trade would remain with the original owner, but a few rights to use the mark is given to a third party. For instance, the key to franchising is the licensing of the intellectual property, such as trademarks. The difference between the two is in ownership of the mark and use of the rights. 

Trademark rights transfer (Assignment)

Assignment of a trademark means that the proprietary rights are transferred. The rights for both unregistered and registered trademarks can be transferred and assigned. It’s done in one of the following ways:

  1. Complete assignment of a Trademark: Here, the owner transfers all his rights in relation to the mark to another person, including the right to earn royalties and the right to transfer the mark further.
  2. Partial Assignment of a Trademark: In this case, the owner assigns the mark to another person (or entity), but only with respect to a few products and services. Meaning, the ownership is restricted and is limited.
  3. Assignment of Trademark with Goodwill: When the trademark is assigned with goodwill, it means that the owner has not only transferred the complete rights of the mark, but has also transferred the value of the mark associated to the goods and services sold under the mark.
  4. Assignment of a Trademark without Goodwill: If the assignment of the mark is made without goodwill, it means that the owner of the trademark doesn’t allow the rights of the mark for the goods and services sold under it. This means that the goodwill attached to the brand is not transferred. Here, the owner and the buyer of the mark would be able to use the trademark, but for dissimilar products. In several countries around the world, assignment without goodwill is not allowed. However, the Indian laws allow such a type of assignment.

To ensure that there isn't any confusion in the minds of the users or the public about the transferred trademarks, the Trademarks Act has put certain restrictions on the transfer and assignment of registered trademarks in India.

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