In recent years, local trademarks and products have been attracting growing interest from consumers. This trend can be explained by the ability of local players to better understand the expectations and tastes of local populations, and by consumers' growing demand for transparency. This growing attraction to local trademarks is also reinforced by the resurgence of trade and geopolitical tensions, which fuel a sense of national pride while contributing to a loss of momentum in globalization.
Impact for Companies in Managing Their Trademarks
This renewed interest in local trademarks could encourage companies to develop distinct product lines adapted to each target market and incorporate the cultural expectations, consumption habits and specific traits of each local context.
For companies that choose to adopt this “glocalization” strategy, managing their trademark portfolio can become particularly complex. Indeed, this approach entails managing several distinct trademarks in several targeted markets, which means undertaking separate legal steps to protect each trademark in each country. Conversely, companies that choose to consolidate their trademark portfolio, by opting to use one or more uniform trademarks on an international scale, can benefit from simplified international management thanks, notably, to the centralization of procedures made possible by the international registration through the Madrid System.
Whatever the strategy adopted, it is essential for a company to file trademark applications in each target country and to ensure that these registrations remain in force for as long as the trademark is used or is intended to be used, even if this means a multiplication of trademark applications for companies opting for the glocalization strategy. In most countries, trademark rights are acquired by simple registration. These rights are thus attributed, generally in good faith, to the first applicant. In Canada and the U.S., however, it is the first user who owns the rights to that trademark in association with those goods or services in his specific geographic territory of use.
Furthermore, it is essential to stress the importance of carrying out availability searches for each trademark in each of the target countries before using the trademark and before filing an application for registration. Although this process can be time-consuming for companies adopting a glocalization strategy due to the potentially large number of local trademarks involved, it remains crucial to ensure that the contemplated trademarks, whether word marks, logos or slogans, do not infringe third parties' prior rights. Neglecting this step exposes the company to both administrative and legal risks, including possible infringement or passing-off proceedings and claims for damages.
Moreover, to remain competitive, trademarks increasingly need to understand the cultural, economic and social expectations of the local populations they target. Communication strategies therefore need to be rethought: building a trademark image that conveys a personalized message, in line not only with the tastes and expectations of local consumers but also with local values and cultural references, maximizes the chances of successfully establishing a presence in a new market.
Local Partnerships to Facilitate Integration into a Local Foreign Market
To design a trademark that resonates with local populations, one strategy is to involve local communities directly in the creative process in collaboration with local partners.
In addition to increasing the chances of creating a trademark that truly resonates with local populations, working with local partners also enables us to learn more effectively about the legal and regulatory requirements of the target market, including the criteria for trademark registrability within that market. These criteria can vary considerably from country to country and are often influenced by the cultural specificities of each jurisdiction. For example, in Québec and Canada, it is not permitted to use the official fleur-de-lys or the official maple leaf—which appear on the Québec and Canadian flags respectively—without the authorization of the Québec and Canadian governments. Conversely, it is possible, in a commercial context, to use a fleur-de-lys or a maple leaf, provided that they are visually sufficiently different from the official versions.
Furthermore, if a foreign company does indeed decide to call on external local partners to create a trademark, it is essential to include explicit clauses in the contract assigning copyright and waiving moral rights in favour of the foreign company. This measure is designed to ensure that all copyright relating to the trademark belongs fully to the company and not to the service provider involved in its design. Neglecting this step could, among other things, jeopardize trademark ownership and management and raise issues, particularly in the context of a company sale or financing.
Moreover, since integrating a company into a local foreign market can be quite challenging, several other types of partnership can be considered to take advantage of the reputation and business network of local partners.
Among the possible forms of partnership, co-branding agreements can provide particularly interesting strategic leverage. This type of partnership enables two companies to work together to jointly market products or services while promoting their respective trademarks. In this way, the foreign company can benefit from the reputation and local roots of an established partner, helping to facilitate its integration into the target market; however, if such a partnership is envisaged, it is imperative to ensure that clear and well-defined contractual stipulations governing the use of each of trademarks are adopted to secure the intellectual property rights involved.
Another form of partnership that can provide interesting strategic leverage is to authorize, through a licensing agreement, one or more local companies to manufacture and market products under one or more trademarks in return for royalties. In this way, a new trademark can benefit from the reputation, expertise and roots of partners who are already well established locally, facilitating its integration into the target market. If such an agreement is contemplated, it is essential to ensure that the licence agreement incorporates well-defined control mechanisms to ensure the protection of the intellectual property rights at stake.
Evolving Legal and Regulatory Realities Specific to Each Target Market: A Challenge Not to Be Ignored
Finally, in a context marked by the strengthening of protectionist policies, it is important to keep a close eye on the evolution of international agreements and the dynamics of cooperation between countries. The partial or total withdrawal of certain nations from their commitments under international conventions can raise issues of trademark protection. In such a context, foreign companies may indeed find it more difficult to assert their rights, including intellectual property rights, due to regulations imposed by local authorities. It is an issue that every company needs to factor into its trademark development and protection strategy.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
