Concept of Trans-Border Protection

Article by Jyoti Lakhoria

Introduction

Companies place a great deal of importance on their goodwill and reputation in the marketplace because these factors show how prospective consumers view their brand. Trans-border Reputation is the term for a brand’s reputation that extends outside its home country through imports or ads to other nations where it may not be used.

Even in situations when the goods are not physically present in the foreign nation and the mark is not registered, the owner of the mark must nevertheless have the right to prevent passing off if the mark has developed goodwill and reputation there.

Origin of Trans-Border Protection       

Alongside the policies of globalization, liberalization, and privatization, the concept of trans-border reputation was first initiated in the 1990s. Through these policies, the concept of physical boundaries was essentially eliminated, and foreign businesses were allowed access to the Indian economy. Consequently, it also rendered the Indian economy susceptible to competition in the international market.

The idea of territoriality in trademark protection met numerous difficulties as trade grew across international borders. These laws, along with the explosive expansion of e-commerce, eliminated the country’s geographical borders, allowing trademarks to become globally recognized brands.

Judicial Approaches in India

The concept of trans-border reputation originated in India when it was discussed in Supreme Court of India during the N.R. Dongre vs. Whirlpool Corporation[1] case.

In N.R. Dongre vs. Whirlpool Corporation case, the Defendant of the international corporation Whirlpool Corporation was based in the US and engaged in production, marketing, and distribution of washing machines throughout multiple nations. The Defendant registered their trademark, WHIRLPOOL, in India in 1956, but they neglected to renew it, therefore it expired in 1977. However, the Indian business that filed the appeal registered the trademark “WHIRLPOOL” for their own washing machines.

Since the Respondent had neglected to renew its trademark registration after 1977, the Supreme Court essentially had to decide whether the Appellant’s action could be justified. The Respondent had a trans-border reputation in the Indian market, according to the Supreme Court, because it had been widely promoted, sold, and used of the mark for a considerable amount of time worldwide. Because of this, the Supreme Court ruled in favor of the Respondent, holding that the Appellant lacked a valid purpose for registering a mark that was identical to one for goods that were similar.

“The reputation of a trademark with respect to a trader’s goods is not necessarily bound by the borders of the country of its origin, but it often makes its presence felt in different countries around the globe where they haven’t been sold or marketed as well,” the Supreme Court said in upholding the Respondent’s rights in their ruling. When a product is introduced in one nation, it is also noticed by people in other nations through ads, films, publications, etc. This holds true even for nations where the particular product is not offered for sale.

In 1988, in Kamal Trading Co. v. Gillette UK Limited[2] case, the Bombay High Court actually prohibited the use of the 7 O’Clock mark for “toothbrushes” because of the mark’s repute and trustworthiness in relation to the Respondent’s products, which included shaving creams and razors. Considering that international trade and shipping of goods are not as significant as they once were, a brand’s goodwill remains untarnished even in cases when the product is unavailable in the relevant nation.

Challenges

Trademarks’ reputation across borders poses several difficulties and issues for the legal system. The possibility of trademark infringement and unlawful use across jurisdictions is one of the main problems. A trademark’s reputation grows outside of its nation of origin, making it more susceptible to abuse by uninvited parties looking to profit from its popularity and goodwill. In the end, this could hurt the legitimate owner of the trademark by confusing consumers and diluting its distinctiveness.

The difficulty of establishing a transnational repute in court is another obstacle. A significant amount of proof, such as widespread advertising campaigns, media attention, and consumer recognition in other countries, is frequently needed to establish a trans-border reputation.

All things considered, the international reputation of trademarks presents issues about illicit usage, obtaining proof, enforcing the law, and the influence of online trade. In an increasingly interconnected global marketplace, addressing these issues calls for international cooperation, harmonization of legal standards, and strong trademark protection procedures.

Conclusion

The importance of a trademark’s transborder reputation being appropriately recognized and protected in many nations is underscored by the expansion and development of the global market. The transborder repute of a trademark has been accorded appropriate importance and protection by Indian courts. It is always advised that overseas businessmen register their trademarks in as many nations as they can to prevent any form of dispute. In India now, foreign trademarks that are not registered are still recognized and protected due to their reputation across international borders.

[1] (1996) 5 SCC 714

[2] 1988 (8) PTC 1 (BOM)