Copycats undermine the investment that a business makes in building its brand
Charles Schofield

For some businesses, their brand names can be their number one asset. Their entire business can be built around the way people identify and connect with their image, rather than the product or service they provide.

A classic example that we see almost every day is the fierce rivalry between Coca-Cola and Pepsi. Both companies work hard to promote their own distinctive image and thus appeal to different consumer groups. It's sometimes unsettling to think that so much noise is being made over fizzy soda drinks, which when it comes down to the basics, bear more than a passing resemblance to one another.

For those businesses, it's not the product but the brand that is their unique selling point. Although this is an extreme example, this same reliance on brand plays itself out in many facets of commercial life.

The risk for any business that has a distinctive brand or differentiates itself through its brand is the copycat – someone who uses a valuable brand identity to sell competing products. Allowing copycats undermines the investment that a business makes in building its brand.

It also risks damaging consumer support for a product, if consumers mistake a competitor's inferior product for the real thing. Brand protection is therefore something that protects commercial enterprises and, from the consu-mers' perspective, gives comfort that what is bought is what is bargained for. This article considers the laws that protect brand identity in Oman and practical steps that businesses can take to protect their brand under the law.

Registration
It is essential that businesses wanting to protect their brand in Oman seek registration of their brand names with the Ministry of Commerce & Industry (MCI). Under Omani Trademark Law (Royal Decree 38/2002 - The Law on Trademarks, Data, Trade Secrets and Protection Against Illegal Competition), companies can register their trademarks with the MCI. Trademarks that can be registered are any logos, names, designs or other marks which are distinctive and used to distinguish products and services in order to indicate who they were provided by.

To be eligible for registration, the trademark must be unique to the business seeking registration. If a trademark is already in use by another business or bears resemblance to a trademark already in use, then registration of that trademark will not be permitted.

Once registered, a trademark enjoys full legal protection. Most importantly, it allows the registered owner to apply to a court for an order preventing others from using the protected mark. This may be necessary, for example, where a trademark owner discovers someone is selling replicas of its product or when a competitor is using a brand identity very similar to that of the trademark owner.

If the court agrees to intervene, it may appoint an officer to seize offending products and the machinery and equipment used to manufacture such products. The trademark owner may also pursue a commercial or criminal case, which may include a claim for compensation for any loss of business resulting from the infringement.

Once an application for registration is approved, registration becomes effective from the date of filing the application. The registration is valid for a period of ten years after which it may be renewed.

If during the registration period a trademark is not used over a five-year period and this lapse in usage is not justified, then any third party may apply to have the trademark removed from the register of trademarks. Care therefore needs to be taken to actively use trademarks and monitor their registration period.

Unregistered brand names
If a brand name or other trademark is not registered, then its protection under the law will be limited. The owner of that trademark cannot seek intervention of the courts in the same way that the owner of a registered trademark can.

There are protections under general Omani Commercial Law (Royal Decree 55/90), which prohibit deception or fraud in selling products and misleading persons as to the origins of products. The trademarks law also makes it unlawful to use an unregistered mark or a mark similar to an unregistered mark, if it is used with bad intention, so as to confuse buyers about the identity of the product or service.

Put broadly, these protections will only take effect where sellers are passing off fake goods as originals or using misleadingly similar branding, deliberately to sell similar or identical goods under someone else's brand name. The laws protecting unregistered marks may not, therefore, protect them from being used by others to promote other products different from those to which the brand name is ordinarily associated.

Also, if a seller is openly selling a fake product as a copy, they may not provide protection, as there is no express right to apply to the court for intervention. Therefore, any company serious about protecting its brand name in Oman should apply for registration, to the extent it can.

Licensing usage
Often owners of registered trademarks need to allow others to use them. This may occur, for example, where a distributor promotes and sells a manufacturer's products using the manufacturer's brand. It can also arise in alliances and co-sponsorship arrangements, where two companies will jointly offer products or services. By registering a trademark, an owner gets an exclusive right to use that trademark. The owner is, however, allowed to authorise any other person or company to use that trademark for some or all of the products or purposes for which it has been registered.

Owners of trademarks should include specific provisions in their contracts with third parties that use their branding. This should include clear rules about how the branding can be used or, if it is not practical to set out the rules in advance, providing for the owner to pre-approve any publication of the brand by the person or company using it. In this way, businesses can protect the value of their logos and ensure that they are not used in ways that lessen their value.

Practical steps for protection
Businesses can protect and enhance the value of their brand by undertaking the following steps:

• Identify which business names, logos, marks or other marketing features are open to registration as trademarks and obtain available registration
• Maintain a register of all trademarks regis-tered by the company, including the date of application and renewal dates, and keeping all of the registration documentation in a single place which is readily accessible
• Implement a process to track renewal dates and ensure that renewals are made at least six months before the trademark expiry date
• Monitor the usage of similar brand names, logos or other marks in the market place and take action to protect the brand where needed
• Have a clear business policy communicated to all relevant employees about allowing third parties to use the company's branding

Brand protection is an important issue for many businesses. Being aware of the legal rights available to your company in a country and being proactive in ensuring that those rights are protected and utilised to the maximum extent can go a long way in securing a valuable business asset.

The author is solicitor, trowers & hamlins, muscat. Tel: +968 24 682923
Email: CSchofield@trowers.com