Conflicts between corporate names and trademarks (or trade names) are very common, and there has always been significant debate—both in legal doctrine and in case law—regarding the relationship and differences between these two concepts and, specifically, regarding the scope of the exclusive right conferred by a trademark (or trade name) registration as opposed to a corporate name that may be identical or similar to such marks.
First, we need to clarify the differences between these various concepts:
- The corporate name is the name used to identify companies in legal transactions (it will normally appear in company documents relating to its legal relationships, such as invoices, contracts, etc.). It is registered with the Commercial Registry, and its regulation is set forth in the Commercial Registry Regulations.
- A trademark is the name or symbol used to identify a company’s products and services in the marketplace and distinguish them from those of other companies, and a trade name is the name or symbol used to identify a company in commercial transactions and distinguish it from other companies engaged in similar or identical activities in the marketplace. Both are registered with the Spanish Patent and Trademark Office, and registration grants the owner the exclusive right to use them in commerce.
What happens when a company name matches or resembles a registered trademark or trade name? Does that company name constitute an infringement of the latter?
The provisions of the Trademark Law that resolve this conflict are as follows:
- Supplementary Provision 14
- Article 34
Additional Provision 14 of the Trademark Law establishes a prohibition applicable to the Commercial Registry: commercial registry authorities shall deny the requested corporate name if it matches or is likely to cause confusion with a well-known trademark or trade name.
Under this provision, it is therefore clear that a new application for a corporate name cannot conflict with a registered trademark or trade name. But what happens when the trademark or trade name is not well-known? Or when that corporate name is already registered in the Commercial Registry? Can the owner of the trademark or trade name invoke their exclusive rights to request the cancellation of the corporate name or prevent its use?
In this other case, we must refer to Article 34 of the Trademark Law, which is the provision governing the rights conferred by the registration of a trademark or trade name. According to this provision, in order for the owner of the trademark or trade name to prohibit a third party from using a sign, several cumulative requirements must be met; of these, for the purposes of the matter at hand, we would like to highlight the following:
- It must be used in commercial traffic.
- And the use must be in connection with products or
It follows from the above that:
- The mere registration of a corporate name in the Commercial Registry does not, in and of itself, constitute an infringement of a prior trademark or trade name that the owner of such rights may prohibit. It is necessary for that corporate name to be used in commercial transactions—that is, in the marketplace.
- The mere use of a corporate name as such—that is, for its intended purpose, which is to identify the company in legal transactions—cannot constitute an infringement of a prior trademark or trade name registration that would entitle its owners to prohibit such use. The use of said corporate name must be in connection with goods or services.
Ultimately, this would constitute improper use of the corporate name, since, as noted above, that is not the purpose for which it is intended (the purposes specific to trademarks and trade names), which is to identify the company in legal transactions.
In summary, the owner of a registered trademark or trade name may prohibit the use of a corporate name provided that (in addition to other requirements regarding infringement—such as likelihood of confusion, etc.) such corporate name: (i) is used in the course of trade, and (ii) in connection with goods or services. The right to prohibit infringing use of a corporate name is also expressly provided for in Article 34.3(d) of the Trademark Law.
Furthermore, case law has confirmed the aforementioned criteria or requirements. The CJEU judgment in this matter is well-known: C-17/06 Céline of September 11, 2007, is particularly well-known; its legal principles remain in force and continue to be applied by our national courts.
Previously published in Economist & Jurist
Author: María Cadarso