Lloyds Bank has registered its black horse as a trade mark for its financial services business, and BT has got its "Pan" figure for telecommunications services but, until recently, retailers such as Debenhams could not register trade marks for their retail service businesses. Why, when this is the very business for which they are known and in which they have invested, should they be treated so differently? The traditional argument against retail services trade marks has been that retailers do no more than trade in other people's branded goods. Up until now, this has been widely enough accepted for all such applications to have been rejected but, in the light of a recent hearing, the UK Trade Mark Registry has finally indicated that (in principle, at least) it will allow them to proceed to grant. The impact of this decision may reach far wider than what might be termed "classic" retailers. It may also come to influence the branding strategies of companies whose business interests are as diverse as mail order catalogues and Internet-based virtual shopping malls.
From the moment Bass red triangle was allowed as the first registration, trade marks have been granted for words, signs and the like, provided they are distinctive of the particular trader. Such a 'badge of origin' acts as a guarantee that the branded products were made by that trader. This 'badge of origin' principle extends to services as well. No one would deny that a prancing black horse signifies to the public that the banking services they will receive are those of Lloyds Bank and no one else. Indeed if another person were to use a similar sign to advertise their banking services, trade mark law can be used to prevent them from doing so.
It may seem strange then that traders, such as supermarkets, who sell a multitude of other people's branded products are not able to take advantage of the benefits of registered trade mark protection which are available to other service-orientated companies. Sainsbury's, Tesco's etc can (and often do) register trade marks for their 'own label' goods, but this entails numerous costly applications. The aspect of their business for which they are most famous, namely providing the service of a being a retailer, could not until recently be the subject of a valid UK trade mark application.
Even as late as 1988 Boots was unable to persuade the House of Lords otherwise. However the situation with community trade marks ("CTMs") has been different since the Giacomelli case, in the early summer of 1996. This sports wear manufacturer, based in Bologna, Italy, applied to register its trade mark for retail services. The Office for the Harmonisation of the Internal Market (OHIM), which deals with applications for CTMs, was asked whether the services provided by retail sports shops, retail grocery stores and so on are services for which a community trade mark can be registered.
OHIM's Appeal board considered that, in the same way that consumers may prefer one branded product over another, they also may prefer the range of goods provided by a retailer or the way the goods are laid out by him. In the Appeal Board's mind, retailing of other people's branded goods constituted a service for which a community trade mark could be registered providing the area of service, for example 'in the field of sports goods', was clearly described.
In light of this, many 'retail service' community trade marks were applied for. As a result at the end of 1999, the position was fairly clear in OHIM. Then a test case was put before the Trade Marks Registry to see whether the same policy would be adopted this side of the water. After a recent hearing on this application to register DEBENHAMS, the Trade Mark registry decided in principle to accept applications based on the concept of 'retail services'. However terms such as 'retail services' alone are too vague to define the rights of a trade mark owner. The Trade Mark Registry is planning to give a policy statement towards the end of September. In the meantime it intends to revive the hundreds of speculative applications for retail services trade marks which were suspended during the test case.
Whilst the Debenhams decision is good news for retail businesses by allowing these companies trade mark protection for the very essence of their businesses, the impact of the decision may be felt far further than merely supermarket chains and department stores. Similar 'services' to retail services such as shops, in-store and mail order catalogue businesses, wholesalers, and distributors may also be able to register their trade marks for the services they provide. Indeed in the ever-pervasive Internet arena, virtual malls or shops offering "online shopping" may also be able to argue for registration as a retail service.
First published in Brand Strategy in October 2000.