Author: Nemesis Escalante
Associate – LatinAlliance Honduras
The objective of any company or business is to be recognized in the market within a society, to have its own commercial identity and to be distinguished from its competition. When creating a company, generally one of the main steps is to think and establish the name with which it will be commercially known. To achieve this point it is necessary and essential to get a trade name that allows you to identify yourself among the consuming public. The commercial name is what opens the way to go out and compete in the market, to publicize the products or services that will be made available to the consuming public and it is what allows to begin to create its prestige.
Most of the time we tend to confuse a "commercial name" and a "brand". The industrial property law in its article 79 establishes that: 2) Trademarks It is any visible sign capable of distinguishing the products or services of a company, with respect to the products or services of other companies. 4) The tradename It is the name, denomination, designation or abbreviation that identifies or distinguishes a company or establishment in its commercial activity.
It is very common to confuse both signs, but it is very important to identify their differences. Both trade names and trademarks are regulated by the Industrial Property Law and the Paris Convention.
The commercial name of a company and its right to exclusive use will only enjoy protection if it is duly registered in the industrial property registry. [1]
What are the prohibitions established for trade names?[2]
· A trade name may not be made up of a designation or other sign that, due to its nature or the use that could be made of it, is contrary to morality or public order, or is likely to deceive or create confusion in the public. commercial media or among the public about the identity, nature, field of activities, line of business and any other aspect related to the company or the establishment identified with that commercial name, or related to the products or services it produces or markets.
· A distinctive sign well known in the country and belonging to a third party may not be adopted or used as a trade name.
· The trade name of a extinguished company or establishment may not be adopted until one (01) year has elapsed from the date of extinction.
Benefits of registering the Trade Name
· Registering the trade name generates profits and added value to a company, since it grants its owner the right to transfer it whenever they wish.
· Prohibits a third party from taking advantage of your prestige or reputation.
· It allows the consuming public to associate a unique name with the products or services that are offered, allowing a unique value.
· The products or services offered by a company are protected by the corresponding authority, allowing their protection to be extended or amplified in different countries in case they are marketed in different countries.
Disadvantages for not registering a trade name
· The company is not completely protected by the corresponding authority nor does it have exclusivity over its name.
· No action may be taken against third parties who use the trade name to take advantage of its reputation or prestige.
· The company does not have a competitive image in the market.
· Unfair competitors cannot be prevented from using analogous names that may cause confusion for the consumer.
How do you lose a business name?
· It is lost when it ceases to be used in commerce by its owner for more than five (5) consecutive years without just cause. The holder of a trade name must prove the existence of the company before the Industrial Property Registry Office every five (5) years, by means of an unquestionable document. Otherwise, the trade name may be canceled at the request of the interested party.
· By cancellation request by its owner.
In conclusion, registering the commercial name is an added value to the company of the effort and dedication that is made when creating or starting a business, since in the end it is the name with which it will be identified among users or the consuming public. and with which it will face its competition in the market, it is a very arduous task and one that is acquired over time, therefore, they must protect and register their distinctive signs.
[1] Article 118 of the Industrial Property Law of the Republic of Honduras.
[2] Article 119 of the Industrial Property Law of the Republic of Honduras.