Honduras: The importance of intellectual property for entrepreneurs and their most common mistakes when choosing their brand

Written by:

Sandra Amaya

 

Throughout my career I have known many cases of brands that have managed to position themselves successfully in the market in a short amount of time and unfortunately I have also witnessed how these companies have been forced to change the name of the main brand and to withdraw from the market as much advertising and products or services they had already made available to consumers, all because they had not given importance to the protection of their intellectual property. No previous studies of feasibility and availability of the brand were made and they were launched to the market with a great advertising campaign, seeming at that time everything was going well and then the entrepreneur decides to start the process of brand registration, it is at this point that he realizes that the brand is not available and he will have to irremediably take a step back and start again with another sign.

 

The fact of being good at a business and developing prestige inevitably generates fraudulent imitation, since it is easier to grab hold of the merchant who is on the rise and parasitically profit from his or her reputation. These competitors in many occasions go ahead and register the trademarks, leaving the honest trader with a case of unfair competition.

 

These cases are common and are the result of not valuing the brand; these entrepreneurs have neglected the armor of their most important intangible asset, “the brand or sign“.

 

The most common errors:

 

  1. Believing that having the company or business registered in the Public Registry of Commerce is sufficient. The brand and the Commercial Name are different from the name of the company, of the enterprise, there are some entrepreneurs who associate the name of the company with those of their products or services and that’s alright, however, the brand with which it is distinguished must be original, dissimilar and novel in the market.
  2. Starting the commercialization of the products and services without stopping to analyze the availability of the trademark in the market and at the registration level. It is common that, once an advertising campaign has started, or after the products or services have been launched on the market, the entrepreneur receives a call or a cease and desist letter prohibiting the use of a trademark that belongs to somebody else, because availability studies were not carried out previously.
  3. Using weak, common or generic brands. The farther away from common elements the better, since one of the registrability requirements is that the trademark must be different, original and capable of distinguishing the products from other competitors in the market. If you offer internet services, do not use CYBER CAFÉ, if you sell dairy products do not use DAIRIES OF OLANCHO, if you have computer maintenance services do not use COMPUSERVICES, etc.
  4. Using the trademark without registering it at the Industrial Registration Office. This is common, entrepreneurs usually do not register the trademarks, they wait until they have enough money to protect themselves and this is a serious mistake that can be very expensive and very risky, why? Because when a trader wants to assert his or her right against third parties that without the trader’s consent use the trademark in the market, they face several scenarios:

a. Initially, if a complaint is filed for acts of unfair competition or infringement of intellectual property rights, the Registry office requires that the complainant has the trademark that has been infringed registered. The registration process takes approximately 7 to 9 months if there are no objections or oppositions. Meanwhile, the infringer may continue to use the trademark freely. It may seem unfair, but this is how the system is established.

b. In the event that the affected party wishes to oppose the registration of a trademark that is in process, he or she must do so through his legal representative by filing an opposition action, but once again the Registry requires that the opponent has previously filed the application for registration and prove the prior use of the trademark in the national market. If you are successful in the opposition process and win the registration of the mark, you must in the future watch that similar trademarks are not used or registered to avoid dilution of the mark in the market.

c. Now let’s consider that the entrepreneur is the one who is using another’s trademark, he or she faces multiple complaints both by administrative and criminal routes, aside from the payment of damages by civil law means. It can be expensive to defend the trademark, but it is more expensive to be defended against an infringement.

 

All these problems can be avoided if the corresponding legal mechanisms for the protection of intellectual property rights are used.  A previous feasibility or availability study is not expensive and further inconveniences are avoided in the future. It is recommended to start the company with a good foundation, protecting the most important asset and thus avoiding costly legal processes and many unnecessary concerns.

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