Business Name vs Trademark: What’s The Difference?
It is a common mistake to view a business name and a trademark as the same thing. The truth is, however, that they both have distinct legal functions and conflating them can have costly rebranding and legal complications down the line. This article will go through the precise differences between them, and then a couple of similarities.
What is a Business Name?
To trade as a business in Australia, you need to register a business name with the Australian Securities and Investments Commission, commonly known as ASIC. A business name is an administrative requirement that gives ASIC the legal name of your business and who runs it.
Once you have registered your business name with ASIC, you are legally allowed to trade under that name. It identifies your business and who runs it to your customers, appears on promotional materials and allows you to trade under a name other than your own personal name.
There are also rules about what business names ASIC can register. A business name cannot use offensive language, use certain special characters and be identical or nearly identical to someone else’s business or company name.
What is a Trademark?
What people do not realise is that registering a business name does not give you legal ownership of that name or any exclusive right to use it. Without additional protections, it can be difficult to prevent another business from using a similar name. This is where a trademark comes in.
Trademarking your business name provides exclusive legal protection for your brand and prevents others from using confusingly similar names in relation to the same or related goods and services. It is a form of intellectual property, making it an intangible asset that gives you the right to take legal action if the trademark is infringed.
You can register your trademark through IP Australia. Unlike a business name, a trademark is not mandatory. However, it is highly recommended if you want exclusive legal control over how your name, logo or slogan is used.
Trademarks are divided into 45 classes that separate trademarks between different industries. Classes 1 to 34 are for goods and classes 35 to 45 are for services. In some cases, different businesses can use the same or a very similar mark if they operate in unrelated fields. It is important to register your trademark in all of the classes relevant to your current business activities and any you genuinely intend to use in the near future.
Some Similarities
Before deciding on a business name or trademark, it is important to check that your intended name or trademark is not already taken. For business names, you will need to search the ASIC Business Names Register and for marks, you will need to search the IP Australia Trade Mark Register. Both of these registers are publicly available. Forgetting to check, particularly for trademarks, can lead to disputes with other businesses that will force you to rebrand.
Business names are registered for either 1 or 3 years before they need to be renewed, whereas trademarks last for 10 years from the filing date. Both can be renewed indefinitely, provided renewal requirements are met. Both names and marks can also be sold or licensed.
Conclusion
The main difference between the two is their functions. Business names are an administrative requirement, whereas trademarks function as legal IP protection. If you have any questions about business names or trademarks for your small business, please do not hesitate to contact us. We are here to help.
DISCLAIMER: This article is for informational purposes only and does not constitute legal advice.