Why are Community Trademarks beneficial for companies

Why are Community Trademarks beneficial for companies

A Community Trademark, or CTM as it is more commonly abbreviated to, is a trademark that is registered with OHIM – the ‘Organization for Harmonization in the Internal Market’. OHIM permits trademarks to be gain registration rights in all 27 EU member states simultaneously, and without the need to apply to each European country individually. For companies operating in an EU member state, and which have the intentions to expand their business across Europe, a CTM would prove to be very beneficial.

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Reasons for companies to register a CTM

Businesses operating in a competitive European marketplace may find that registering their company name, or brand name of their products and services, will enable them to gain increased brand identity, heightened customer loyalty, and greater protection over their products’ success.

A CTM is essentially a regular trademark in that it obtains a set of exclusive rights regarding the use of the mark, and the owners of a CTM can effectively prevent all third parties from using it without their expressed permission. The profitability of owning a CTM is also a significant drawing factor for companies as, once a mark is registered, they have the right to lease or sell their trademark rights.

Companies operating in EU member states should seek a CTM rather than registering their mark in one EU member state, as this gives them the scope to expand their business across other European countries. If a regular trademark registration is obtained in one EU country, then the company will then need to seek trademark registration rights in each individual country they wish to expand their presence in.

There are many advantages to obtaining a CTM, some of which are detailed below:

  • A CTM obtains a set of exclusive rights in each EU member state, giving the owner of the mark complete control over the use of their trademark across the whole of Europe.
  • Although registration rights apply in 27 EU member states, only one application for registration needs to be sent to OHIM.
  • CTM renewal is achieved by filing one renewal application form to OHIM.
  • Owning a CTM is the most cost effective way of owning trademarks rights in more than one EU member state.
  • All CTM’s are monitored, and regulated in compliance with European standards, and intellectual property law.

European companies with a reputable brand name, or which have a brand that is widely associated with their products or services, are advised to register their trademark with OHIM in order to obtain a CTM.