Protecting Your Beauty Brand – Global Trademarks
02/03/2020 by The Red Tree
Diana Palchik founded Beauty Mark to provide strategic trademark consulting services and education to beauty and wellness brands. She has served in a trademark advisory role at a UK accelerator for beauty companies. In addition to her trademark work, she regularly handles commercial agreements and is highly experienced with technology transactions. A former legal counsel at Mary Kay headquarters, Diana has been practicing law for almost 19 years. She has a business degree in international business with an emphasis on marketing from a top-ranked business school and has worked at the regional office of a national retailer as a business analyst, graduating from its executive training program.
Imagine a (fictional) successful young company called Fin Beauty operating in the UK with a line of beauty products branded FIN. Fin Beauty plans to expand into other markets within 6 months and has a UK trademark registration for the mark FIN. What should it do about international trademark protection?
First, Fin Beauty’s management should know that the process of securing trademark rights is a race, and also that there is no universal registration available. Trademark rights are territorial. They pertain to specific countries or regions (e.g., EU). The company must find out if the mark FIN is available for use and registration in its target markets. If not, Fin Beauty will need a branding strategy that takes into account the unavailability of the mark in certain markets. The company could adopt different branding in different countries or perhaps rebrand entirely if it finds a new name that is widely available.
Fin Beauty’s trademark counsel will search for too-similar active marks in the target markets, with the rules of particular countries or regions in mind. For example, when searching the U.S., counsel must search beyond the obvious matches such as FIN or FINN and look for “foreign equivalents.” A foreign equivalent is a foreign-language translation of a word that a national Trademark Office can cite as a reason for registration refusal. For instance, the United States Trademark Office determined that UHAI (Swahili word meaning “life”) as used on hair products was in conflict with the mark LIFE FOR HAIR as also used on hair products. In an effort to minimize risk and understand the trademark landscape, Fin Beauty’s counsel will evaluate whether there are any other possible grounds for registration refusal.
Fin Beauty understands that because it is in a race against other companies, with only a finite number of words available, it should apply for a trademark registration as soon as possible if the mark appears registrable.
Let’s say that Fin Beauty’s counsel finds no likely obstacles in the target markets. Fin Beauty must now decide when and where to file applications. Fin Beauty wants to secure the earliest possible priority date for its mark, vis a vis competitors. A priority date is the earliest date a trademark owner can rely on to establish trademark rights in a particular territory. In the case of conflicting marks, the trademark owner with the earliest priority date has superior rights and generally prevails in a dispute. In any of the 177 countries that are members of the Paris Convention treaty or any of the 90 countries that are members of the Madrid Protocol treaty, a trademark applicant may be able to secure an earlier priority date that is based on its already-filed home country application. Eligibility for that advantage requires Fin Beauty to file in treaty countries within 6 months of having filed its home country application. If Fin Beauty misses the 6-month timeframe, its priority date will be the later date on which it filed the target country application. In that case, there is a risk that someone else has already filed first.
When taking into account search fees, lawyer fees and government filing fees, this race can become quite expensive as more and more countries are added. Another, longer-term, cost consideration is that of enforcement costs in foreign markets. Enforcement may include sending cease and desist letters, initiating administrative opposition or cancellation proceedings, or even litigation. Because there is no trademark police, it is up to Fin Beauty to pursue counterfeiters and other infringers in the new markets as problems arise. At the same time, the mere existence of a trademark application will effectively deter a certain number of companies from adopting a confusingly similar mark.
Fin Beauty should prioritize markets by importance to its business objectives. China, India, and Brazil hotbeds of counterfeiting activity -may end up toward the top of the list if Fin Beauty plans to roll out in any of those countries. Counterfeiting is an important factor to consider when formulating trademark strategy. The International Trademark Association’s (“INTA”) 2019 submission to the U.S. Department of Commerce predicts that, by 2022, the total value of international and domestic trade in counterfeit and pirated goods will be between $1.9 – $2.81 trillion.
Beauty brands should develop growth strategies with an eye toward varying trademark rules and risks in different countries and regions. A business’s projected growth speed and risk appetite will determine which markets to target and when.
The Red Tree is the UK’s leading international beauty brand consultancy and a powerhouse of ideas, insight and inspiration. For an informal discussion on how we might help you, please contact us.
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