Businesses transferring assets during mergers, acquisitions and other company restructures need to ensure they do not forget about foreign trademarks.
Colleen Flynn Goss, counsel at Fay Sharpe, said that while trademarks and associated registrations are usually listed in sale or transfer documents, transactional counsel often fail to understand the regulatory requirements of different jurisdictions.
“A common error we come across is that the transfer language simply says that the company transfers ‘all worldwide right, title, and interest in the ABC trademark and to any and all registrations and applications throughout the world’,” she told Smart Business.
“This simply will not suffice in many countries.”
Ms. Goss said that although title to trademarks is transferred in a bill of sale or assignment document executed at closing, firms still need to record the title change in the required format with the proper trademark registries around the world.
This can be expensive when there are registrations in multiple countries, she noted.
Ms. Goss said companies should not wait before transferring the title of trademarks to another organization.
“Many countries require the use of specific forms that have to be filled out in a very particular way in order to register a transfer,” she told the news provider.
“For example, the process might necessitate that you have documents signed both by the new and original owner, or you may need the original documents and not certified copies or legalizations by particular consulates.”
She said that while businesses may have thought they were saving money by waiting to file the transfer documents, this may inadvertently lead to greater expense.
“Just because you had a registration does not mean that you will be able to obtain a new registration for the same mark,” Ms. Goss stated.