A bakery on Queen Street incorporates, buys a sign, prints boxes and builds a following over five years. Then a letter arrives from a company in Alberta that registered a similar name as a trademark, asking the bakery to stop using it. The owner is baffled. Didn’t the Ontario government approve the name? Isn’t the corporation’s registration enough?
No, and this hypothetical situation shows the most common misunderstanding in brand protection. Incorporating a company or registering a business name allows you to carry on business under that name. It doesn’t grant you exclusive rights in the name as a brand, and a domain name doesn’t either. Those rights come from trademark law, which is federal and administered through the Canadian Intellectual Property Office (CIPO).
Please read what follows as general information about Canadian trademark law, not legal advice for your situation. CIPO’s forms, fees and timelines change from time to time, so check its site for current details.
What a Trademark Is, and Whether to Register
A trademark distinguishes your goods or services from everyone else’s. Most people think of a word or a logo, but the Trademarks Act defines the term broadly enough to include slogans, colours, shapes, sounds and other signs in the right circumstances. For a typical Brampton business, the real candidates are the business name, a product name and a logo.
Trademarks differ from their intellectual property cousins. Copyright protects original works such as the artwork in a logo or the text of a brochure. Patents protect inventions. Industrial designs protect the visual features of a manufactured product. One brand can involve several of these at once.
Registration is not mandatory. You can acquire some rights simply by using a mark. An unregistered business with a reputation in its market may be able to bring a passing off claim against someone who confuses customers. Those rights are real, but they have disadvantages. You must prove your reputation and the resulting harm, usually in the geographic area where you are known, and that can be expensive and uncertain.
A registration is different. Section 19 of the Trademarks Act gives the owner, unless the registration is shown to be invalid, the exclusive right to use the mark throughout Canada for the registered goods or services. So registration can extend protection beyond Peel Region even if you have only ever sold here. It also gives you a public record that shows up when other businesses search, and a stronger basis for a dispute.
Start With a Clearance Search
Filing without searching first is a common and costly mistake. Before you spend on signage or packaging, investigate whether someone else already has rights in a similar name.
A reasonable search covers the Canadian Trademarks Database, corporate and business name records, the web, app stores, and social media platforms. Remember that “confusing” doesn’t mean identical. The Trademarks Act looks at matters such as how similar the marks look or sound, the ideas they suggest, the nature of the goods or services, and how long each has been used. “Peel Pastry” and “Peal Pastries” may conflict even though they aren’t spelled the same way.
Results should be interpreted carefully, since a lookalike in an unrelated field may be fine, while a similar mark in a nearby field could be a serious obstacle. This is one place where a lawyer or trademark agent can add real value.
Will the Mark Be Registrable?
Examiners refuse marks for several reasons. A mark may be rejected if it is clearly descriptive of the goods or services, or deceptively misdescriptive. “Fresh Bread” for a bakery tells customers nothing about the source. A name that is primarily just a surname can raise difficulty, and so can a mark that isn’t inherently distinctive.
Business owners often like descriptive names because they explain the business at a glance. Trademark law generally rewards the opposite. An invented or unusual word tends to be easier to register and enforce. If you are still choosing a name, this is worth weighing before anything is printed.
Filing the Application
Applications are filed electronically through CIPO. You will need to identify the owner, represent the mark, and list the goods and services. A few decisions here have lasting consequences.
Name the right owner. Should the mark belong to your operating company, a separate holding company, or an individual? Ownership affects licensing, creditor exposure and a later sale. If the wrong person files, fixing it may be difficult, and a registration can be at risk if the applicant wasn’t entitled to it.
Describe goods and services accurately. Canada uses the Nice Classification, and fees depend on the number of classes. Your protection is tied to what you list, so too narrow a description leaves gaps, and overreaching may create trouble if you have no genuine intention of offering those items. Bad faith filing is a ground of invalidity under section 18 and of opposition under section 38.
Choose word mark, logo or both. A registration for words in standard characters often gives broad protection that covers different fonts. A logo registration protects the design. Many businesses with limited budgets start with the word mark, as a logo can be redesigned over time.
Canada does not require you to have already used the mark in order to file or register. That allows you to protect a brand before launch. As we discuss below, use still matters later.
From Examination to Registration
After filing, the application goes through several stages:
- Formalized filing. CIPO confirms the application meets basic requirements and assigns it a filing date. That date can matter a great deal if a competitor files something similar later.
- Examination. An examiner reviews the application for compliance, registrability and possible confusion with existing marks. The examiner may issue a report with objections, and a response is required by a set deadline.
- Advertisement. Once approved, the application appears in the Trademarks Journal.
- Opposition. Under section 38, anyone may oppose within two months of advertisement, on grounds that include non-entitlement, non-distinctiveness and bad faith. Most small applications are not opposed, but when one is, the process resembles a small legal proceeding.
- Registration. If there’s no opposition, or if it fails, the mark is registered once the registration fee is paid.
The full process can take a long time, depending on CIPO’s workload at the time. For this reason, it makes sense to file well before you need the registration.
Keeping Your Registration Alive
Registration is the beginning of ownership and not the end of your responsibilities.
Renew. Under section 46, a registration lasts ten years and may be renewed for further ten-year periods on paying the fee. CIPO’s correspondence can be missed if your address is out of date, so keep your contact information current.
Actually use the mark. After three years from registration, section 45 allows the Registrar to require the owner to show use during the preceding three-year period. Anyone can ask CIPO to start that process. Without use or special circumstances excusing it, the registration may be expunged or narrowed. Keep dated samples of invoices, packaging, advertising and photos of signage, organized by year and by goods or services.
Use also affects enforcement. Under section 53.2(1.1), an owner who sues within three years of registration isn’t entitled to relief unless the mark was in use in Canada during that time or special circumstances excuse its absence.
Control licensees. If a franchisee, distributor or affiliate uses your mark, put a written licence in place that gives you control over the character or quality of the goods or services. Uncontrolled use can damage distinctiveness, which in turn puts the registration at risk.
Use the mark consistently. Heavy changes to the logo may mean that what you use no longer corresponds to what you registered. If you rebrand substantially, consider filing again. The ® symbol is optional in Canada, and many owners find it useful to signal a registered right. Use it only where the mark is actually registered.
When Someone Uses a Confusing Name
Finding a copycat can be upsetting, and the instinct to fire off an angry social media post is understandable. Resist it, as public accusations can create separate legal problems.
Instead, gather evidence: screenshots with dates, sample products, receipts and instances of real customer confusion. Check whether your rights predate theirs, because they may have prior use you don’t know about. In that case a demand could trigger a challenge to your own registration. A lawyer can then advise on options that range from a measured letter to negotiating a coexistence agreement, or a Federal Court or Ontario Superior Court claim for infringement, depreciation of goodwill or passing off.
Sections 19, 20 and 22 of the Act give registered owners distinct rights. Remedies can include injunctions, damages or an accounting of profits, and destruction of infringing goods. Which forum and what remedy make sense depends on the value of the brand and the facts.
The same considerations apply in reverse. If you receive a demand letter, don’t ignore it and don’t reply in a hurry. Note any deadline and get advice before making admissions.
Selling Outside Canada
A Canadian registration protects you in Canada. If you sell into the United States or overseas, or import products under your own brand, look at protection in those markets. Canada participates in the Madrid Protocol, which can allow one application to extend to several member countries. Timing can matter because priority rights for foreign filings are generally time-limited, so raise it early.
A Simple Plan for a Small Business
Search before you commit. File for the name that carries your reputation, in the classes that truly matter, under the correct owner. Diary the deadlines and keep evidence of use. Licences should be in writing, and any infringement deserves a calm and measured response.
Our intellectual property page outlines how this kind of work can be handled, and you are welcome to get in touch to ask about a name you are considering. Brand protection is much cheaper before the sign goes up.