Many start-ups rely on the assumption that mere use of a name or logo is sufficient to secure rights to it. However, German trademark law (Section 4 MarkenG) primarily provides for the registration of a trademark to ensure comprehensive protection. Contrary to common belief, there are only very limited possibilities under German law to invoke a right of prior use. Without an official application, third parties might register the name or logo, thereby acquiring exclusive usage rights. This can lead to start-ups being prohibited from using their trademark – even if they have already established it. In this article, we will show why it is essential to register a trademark with the German Patent and Trademark Office (DPMA) or the European Union Intellectual Property Office (EUIPO). We will also examine the risks of operating without trademark protection and how strategic trademark registration creates long-term competitive advantages.
Why is a Trademark Application So Important?
Registering a trademark offers start-ups numerous advantages that extend far beyond mere legal protection. A registered trademark is not just a legal instrument, but also a strategic asset.
- Exclusive Rights of Use: Registration grants the owner the exclusive right to use the trademark for specified goods or services. This prevents competitors from using similar or identical signs. Without this protection, third parties may register the trademark and prohibit the original user from using it.
- Protection Against Imitation: A registered trademark protects against imitators and strengthens the start-up’s competitive position. In highly competitive markets, it is crucial to differentiate your business with a protected trademark and avoid customer confusion.
- Increasing Company Value: A registered trademark is recognized on the balance sheet as an intangible asset. It increases the company's value, which is an important factor during financing rounds or a later exit.
- Legal Certainty: Without trademark protection, there is a risk of legal conflicts with competitors or other third parties. A registered trademark provides a clear legal basis and facilitates the enforcement of claims in cases of trademark infringement.
- International Expansion: With a national registration at the DPMA or a European application at the EUIPO, start-ups can expand their trademark rights internationally. This can be achieved, for example, through the Madrid system for worldwide trademark protection.
Example: A startup has been using a creative brand name for its products for two years. However, a competitor registers this name as a trademark and obtains an injunction against the startup. The company is forced to change its name, losing not only customer loyalty but also valuable resources on rebranding efforts.
The Myth of Prior Use: Why Use Alone Is Not Enough
Many founders mistakenly believe that the mere use of a name or logo automatically establishes trademark rights. In reality, German trademark law (Section 4 MarkenG) stipulates that trademark protection in Germany primarily arises through registration in the trademark register. Prior use only grants protection in exceptional cases.
For instance, if a trademark has gained a reputation through intensive use, protection might arise. However, this requires that a significant proportion of the target group clearly associates the sign with the company. This is rarely the case in practice, and the requirements for proving reputation are high and involve considerable costs, such as expert opinions or market studies.
Moreover, prior use does not protect against registration by third parties unless it can be proven that they are acting in bad faith (Section 8 (2) No. 14 MarkenG). Therefore, it is much easier and more cost-effective to apply for a trademark at an early stage. This secures comprehensive rights and helps avoid conflicts.
Many founders also underestimate that not only company or product names are affected. Functions, event names, or other specific designations used in a business context also require protection. Without a registered trademark, there is often no protection whatsoever – neither as a work under copyright law nor as a business name. Thus, protecting business ideas and concepts is crucial.
Example: A young company has been using the name "GreenTech Solutions" for its renewable energy services for years. A competitor applies to register this name as a trademark and succeeds. The original company can only continue to use the brand name if it can prove that "GreenTech Solutions" has already acquired a reputation, which is a time-consuming and uncertain process.
Another example from our practice illustrates this point. A game developer had established a special event in his online game, which was held regularly over the years and was very popular with players. However, the name of this event was never registered as a trademark. A competitor then protected this very event name as a trademark, gaining exclusive rights to it. The original game developer can no longer use the event under this name. They now face the challenge of either finding a new name or taking legal action against the registration, which is a lengthy and costly process with an uncertain outcome.
These examples highlight a critical point: Whether it is a company name, product name, or specific designations like event names, without a registered trademark, there is always the risk that third parties can protect them. This could block their use by the original creator. Start-ups should therefore identify essential terms or signs for their business model early on and register them with the DPMA or EUIPO in good time. This is the only way to establish long-term legal certainty and secure your competitive advantage.
How Can Start-ups Protect Their Brand?
To effectively protect your brand, start-ups should follow a structured approach, starting with thorough research and culminating in strategic registration and monitoring.
Thorough Trademark Research
Before applying for a trademark, it is crucial to check whether identical or similar trademarks already exist. A professional search at the DPMA and in international databases, such as the EUIPO, helps prevent conflicts. You should not only look for identical names; similar signs can also be problematic if there is a risk of confusion.
A thorough search protects against expensive legal disputes and prevents unnecessary investment in a trademark that may not be protected. Start-ups should be aware that regional differences in trademark registration can exist, especially with international registrations via the Madrid system. This preparatory step is vital for legal preparation for investment rounds.
Choosing the Right Trademark Form
Start-ups can choose between different trademark forms, depending on their strategic needs:
- Word Mark: Protects the name regardless of font or design.
- Figurative Mark: Protects the logo or graphic element.
- Word/Figurative Mark: Protects the combination of name and logo.
The choice of the appropriate form depends on how the start-up intends to use its brand. For example, is the focus on the name or the visual design? For many founders, it makes sense to register a word mark first, as this offers more flexibility than a purely figurative mark.
Application to the DPMA and EUIPO
The application for national trademarks is filed online via the DPMA, and for European trademarks (European Union trademarks), via the EUIPO. The following steps are generally required:
- Provide a clear description of the brand.
- Select relevant goods and service classes according to the Nice Classification.
- Pay the application fee (from €290 at the DPMA; from €850 at the EUIPO).
After successful examination, the trademark is entered into the register. Legal protection then applies in Germany (DPMA) or in all EU member states (EUIPO) from that point onwards. This registration offers comprehensive protection within the respective geographical area of application.
International Registration
For start-ups with global ambitions, international registration via the Madrid system (WIPO) is highly recommended. This allows the trademark to be protected in several countries simultaneously, which is an important step for companies with expansion plans. International registration builds upon a national or European basic trademark. It enables start-ups to efficiently extend their rights to multiple markets, which is particularly relevant for industries with strong global competition.
Conclusion: Early Trademark Protection Pays Off
Protecting a trademark by registering it with the DPMA or EUIPO is essential for start-ups. This ensures long-term success and helps avoid legal conflicts. Contrary to common assumptions, the mere use of a trademark does not offer reliable protection against imitators or competitors. By registering early, founders can secure exclusive rights and strengthen their market position.
As a lawyer specializing in start-ups and companies, I support you in legally protecting your ideas – from research and registration to defending your rights in the event of conflicts. Invest in the protection of your trademark, because it is far more than just a name!