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What are Trade-Marks and Why Are They Important

Trade-marks are unique identifiers (such as a word, logo, slogan, symbol or shape) that distinguish the goods or services of one company from those of another. Businesses use trade-marks as marketing tools to help consumers recognize the quality and reliability of their products. In this way, trade-marks become valuable assets. Interbrand, a brand consultancy firm that annually ranks the value of global brands, listed the following five "Best Brands" for 2009

  • Coca Cola (brand value of $68.7 B),
  • IBM ($60.2 B),
  • Microsoft ($56.6 B),
  • General Electric ($47.8 B) and
  • Nokia ($34.9 B)

Canada's top brands were Thompson Reuters Media, ranking 40th with a brand value of $8.3 B, and BlackBerry, ranking 63rd and valued at $5.1 B.

Trade-mark protection is a company's primary legal means of protecting its brand. Without this protection, firms producing products of inferior quality and counterfeiters could seek to increase their sales volumes by trying to pass off their goods as those of well-known, reputable firms. This has the potential to decrease the market share of legitimate producers and to damage their reputation.

Trade-marks are also important in trade, as the quality and reputation associated with a firm's trade-mark helps the firm enter a new market or expand in an existing one.

Canada's International Intellectual Property Obligations Respecting Trade-marks

Canada is a party to and compliant with the Paris Convention for the Protection of Industrial Property, administered by WIPO, which assists individuals and businesses obtain protection for their intellectual property in other countries. Canada is also a party to and compliant with the World Trade Organization's Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs), which requires members to have a trade-mark registration system and to provide minimum levels of protection for trade-marks.

Canada is not compliant with either the Madrid Protocol or the Singapore Treaty and is finding itself increasingly isolated internationally because of its outdated trade-marks regime. Many of Canada's trading partners, such as the United States, Australia, Japan, the United Kingdom and the European Union, have acceded to either the Madrid Protocol or the Singapore Treaty or both. As a result, many trade agreements between these countries now specifically require accession to the Madrid Protocol. This trend will likely continue in the future, as countries continue to join these treaties.

Updating Canada's Trade-marks Act

Canada has not kept pace with trading partners that have improved their trade-mark laws by introducing amendments to respond to new business practices, to adopt international standards, and to allow businesses to more easily respond to global trading opportunities. In fact, Canada's Trade-Marks Act is substantively the same as it was over 55 years ago.

The key objectives of updating the Trade-Marks Act are to:

  • simplify and streamline the trade-marks regime, thereby improving accessibility, reducing transaction and compliance costs, and lowering the overall cost of doing business;
  • align with accepted international standards and practices, thereby easing foreign market access for Canadian firms and helping increase their competitiveness, and reducing entry barriers for foreign firms leading to increased investment opportunities in Canada; and
  • respond to new business practices by offering protection for new forms of trade-marks (e.g., sound, colour, motion), thereby allowing businesses to fully take advantage of investing in their brand.

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