When launching a new business, the array of registrations – ABN, Business Name, Trademark, Domain Name – can be overwhelming, often leading to confusion about the rights each one confers. A common misconception is that registering your business name secures exclusive usage rights. In reality, full brand protection requires trademarking your business name.
Understanding the distinction between a business name and a trademark is crucial in deciding whether you need to register a trademark, or if business name registration suffices.
Understanding a Business Name
A business name is the official name under which your company conducts its trade. In Australia, it’s mandatory to register your business name in the Australian Business Name Register, except when trading under your personal name. This registration is a legal requirement to prevent potential business risks.
It's important to note that while your business name must not be identical or overly similar to an existing one, it doesn't offer exclusivity. For instance, if your business is "Troy's Electrical Services," a competitor could legally operate as "Troy's Electricians." Furthermore, if another party has trademarked a name you've registered for your business, continuing to use it could lead to legal issues.
What is a Trademark?
A trademark, unlike a business name, grants ownership over a name, symbol, or other unique brand identifier. It provides legal protection, giving you exclusive rights to use and enforce your trademark. This could range from a name to a logo, a distinctive sound, or even an image.
Your trademark limits others from using it in the same sector. However, its protection is confined to your specific industry or service. For example, "Troy's Electrical Services" could be trademarked in the electrical sector, while "Troy's Bakery" could exist in the food industry under the same "Troy's" brand without infringement, due to the clear distinction in services.
Trademark vs. Business Name Registration: Which Do You Need?
Typically, trademarking a business name also necessitates its registration as a business name. The decision to trademark depends on your business's scale and recognition. Without trademark protection, another entity could trademark your business name, potentially jeopardizing your brand, especially as your business grows and gains prominence.
For small businesses with limited brand recognition, the risk of not trademarking may be minimal. However, for businesses aiming for significant market presence or those already well-established, not securing a trademark could pose substantial risks.
In conclusion, not trademarking your business name is a gamble. Given the time-sensitive nature of the trademarking process, it’s advisable not to delay this crucial step in securing your business’s brand identity.
