Chapter 3: Trade marks
IP Report 2020
Trade marks are distinctive signs such as words and symbols that consumers use to identify companies or products and services to distinguish their quality and source. Having a uniquely identified trade mark helps producers to build their reputations and enables consumers to make more informed purchase decisions. Registered trade marks are afforded protection for 10 years. The protection periods can be renewed indefinitely, to create and sustain informed markets.
Trade mark applications and registrations:
A total of 75 622 trade mark applications were filed in Australia in 2019, a five per cent decrease on application levels in 2018 when they reached a record peak. Applications for trade marks in Australia have tended to increase over the past two decades, as illustrated by Figure 9.
Trade marks have to be examined to establish that an application is not in conflict with other earlier marks before they can be registered for protection, their registration signified by use of the symbol. Trade mark registrations in Australia reached 58 641 in 2019, down two per cent on their decadehigh peak in 2018.
Figure 9: Trade mark applications and registrations, 2010-19
Resident and non-resident filings:
In 2019, Australian residents filed 44 176 trade mark applications, or 58 per cent of the total applications filed in Australia. Non-residents filed 31 446 applications, or 42 per cent of all applications. Applications from residents were down by four per cent on their level in 2018. Those from non-residents were down six per cent from 2018.
The resident-to-non-resident split in applications has narrowed over the past two decades: non-residents have tended to grow annually in their share of applications, from a low base of 30 per cent in 2004. This narrowing of the difference has accelerated in recent years. Between 2004 and 2016, the non-resident share of applications ranged from 30 per cent (in 2004) to 37 per cent (in 2013) and averaged 34 per cent. Since 2016, the non-resident share has grown by eight percentage points, from 34 per cent in 2016 to 42 per cent in 2019.
Australian residents are also the major source of trade mark registrations. Of the 58 641 registrations in 2019, the share filed by residents was 54 per cent (31 430 registrations, down 10 percentage points on their level in 2018).
Countries of origin:
In 2019, non-resident trade mark applications predominantly came from the US, China, the UK, Germany and Japan (Figure 10). The US was the largest foreign source in 2019, as in the previous year, filing 29 per cent of all non-resident applications.
Figure 10: Top 5 trade mark filings in Australia by country of origin, 2018-2019
Over the past decade, China has far surpassed other countries for growth in trade mark applications filed in Australia. US-origin filings have grown at an average annual rate of six per cent. Applications from China have grown at an annual average of 24 per cent; they exhibited an exponential rate of increase between 2014 and 2017, rose to a record high in 2018, then fell 14 per cent in 2019 (Figure 11). The fall in applications originating from China is also observed for applications originating from the US, which fell by 6 per cent, and Germany (not shown, down 15 per cent).
Figure 11: Trade mark applications from US, China and the UK, 2010-19
Figure 12 lists the top-ranked domestic and international applicants for trade marks in Australia in 2019. Huawei Technologies, the Chinese smartphone manufacturer, filed for the most trade marks, with 142 applications, primarily in scientific and technological apparatus and services, advertising and telecommunications. Second was the Swiss multinational Novartis, with 140 applications focused in pharmaceutical and medical products. Apple was third, with 113 applications in diverse classes ranging from technological apparatus to financial services. The fourth and fifth ranked applicants were Australian companies. Coles Group, operator of the supermarket retail chain, was fourth, with 112 applications in classes such as brewed drinks, confectionery and condiments, and for trade marks in advertising such as its ‘Good Things, Great Value’ campaign. Fifth ranked was Australian gaming machine manufacturer, Aristocrat Technologies, with 106 filings.
Figure 12: Top 5 Trade mark applicants and classes, 2019
Source: IP Australia (2020 forthcoming), Intellectual Property Government Open Data (IPGOD) 2020, data.gov.au.
Applications by filing route:
Applicants can file trade marks in Australia directly, or they can file a single trade mark in multiple countries, including Australia, via the Madrid system.(13)End note 13. See https://www.wipo.int/madrid/en/ how_madrid_works.html, accessed 28 January 2020. In 2019, 23 per cent of all trade mark applications in Australia were filed via Madrid, its share rising from 16 per cent since 2009. As the Madrid system is almost exclusively used by non-residents, growth in the proportion of applications filed by this route reflects the growing strength in nonresident filings.
Trade mark classes:
Trade marks in Australia are attributed to one or several classes of goods and services. Trade mark classes are defined in the Nice Classification, the international classification of goods and services, comprised of 45 classes.(14)End note 14. For details, see: https://www.uspto.gov/trademark/ trademark-updates-and-announcements/ niceagreement-current-edition-version-general-remarks.
In 2019, a total of 142 543 classes were nominated in the 75 622 trade mark applications filed in Australia, an average of 1.88 classes per application. As was the case in 2018, five classes dominated the selection, accounting for 38 per cent of the total (Figure 12). Since 2002, there has been relative stability in the degree to which trade mark applications in Australia are concentrated across classes.(15)End note 15. The concentration of applications across classes is measured using the Herfindahl-Hirschman (H-H) index. The index is constructed by identifying the percentage of total applications in a given year which nominate each class, squaring and then summing the shares of all classes. In determining the class concentration for each year, the index gives greater weight to classes with a higher share of applications.
States and territories:
Of the states and territories within Australia, New South Wales accounts for the largest share of trade mark applications, with 15 967, or 36 per cent of the total in 2019. Victoria and New South Wales are equally trade mark intensive, with two applications for every 1 000 persons in the state (Figure 13).
In 2019 applications fell from their levels in 2018 for all states and territories except Tasmania. Applications from Tasmania rose by nine per cent, from 396 to 433.
Figure 13: Trade mark applications, states and territories, 2018-19
Source: Calculations of per capita figures from: Australian Bureau of Statistics. Australian Demographic Statistics, March 2019.
https://www.abs.gov.au/ausstats/abs@.nsf/lookup/3101.0Media%20Release1Mar%202019. Retrieved 27 January 2020
Trade marks in the digital economy
Like ICT-related patents in the first two decades of the millennium, ICT-related trade mark applications fell significantly between 2000 and 2002 and then made a steady recovery. ICT-related trade mark applications fell by 39 per cent in the two years following the dot-com crash, an even larger decrease than the 23 per cent fall observed in ICT-related patents during this same period.
The fall in ICT-related trade mark applications outpaced the decline in the general population of trade mark applications, which fell seven per cent on their level from 2000. This contrasts with total patent applications, which maintained growth of five per cent in this period. Since 2002 there has been growth in both the number of ICT-related trade mark applications and in the share of the total trade mark applications filed at IP Australia (Figure 14). This may indicate that the Australian economy has become more and more digitalised, with electronic goods and digital services that have brand names protected by trade marks.
ICT-related trade mark applications have more than trebled from 6 328 in 2002, when they accounted for 16 per cent of total applications in Australia, to 20 553 in 2018, representing 26 per cent of total applications.(16)End note 16. The definition of ICT-related trade marks follows that in OECD Science Technology and Industry Scoreboard 2017 (pages 150-51, https://www.oecd.org/sti/ oecd-science-technology-and-industry-scoreboard- 20725345.htm).
Recent years have seen new consumer technology companies—Uber, Lyft, Peleton and WeWork—with no positive earnings listing on stock exchanges which has led some commentators to speculate that we are in another tech bubble.(17)End note 17. Geier, B. 12 March 2015. What did we learn from the dotcom stock bubble of 2000? Time. Viewed 20 February 2020, https://time.com/3741681/2000-dotcom-stock-bust A sharp 27.5 per cent rise in ICT-related trade marks can be observed between 2016 and 2018, corresponding to the period of rising private investment in consumer technology and one of the major assets of these companies tends to be their name and brand. Among today’s ICT-related trade mark applicants are e-retailers, like China’s Alibaba, and enterprise software services, like Australia’s Atlassian, both with high market valuations and strong revenue growth.(18)End note 18. Thompson, D. 18 October 2019. The not-com bubble is popping: The unicorn massacre unfolding today is exactly the opposite of what happened in 2000. The Atlantic. Viewed 20 February 2020, https://www.theatlantic.com/ideas/archive/ 2019/10/are-we-cusp-next-dot-com-bubble/600232 The data show this trend has been stronger in ICT-related trade mark applications—indicators of digital entrepreneurial activity—than in ICT-related patent applications, which are indicators of technological innovation.
Figure 14: ICT-related trade mark applications in Australia, 2000-18
Source: IP Australia (2019), Intellectual Property Government Open Data (IPGOD) 2019, data.gov.au.
Australian filings overseas:
Data on trade mark applications filed overseas by Australians shows continual growth: Australian residents filed in a total of 43 522 classes overseas in 2018 (latest data), an increase of six per cent on the level observed in 2017 (Figure 15).
Figure 15: Level and growth of trade mark classes, Australian-origin filings overseas, 2009-18
Source: WIPO IP Statistics Data Center 2019. Retrieved 27 January 2020 from https://www3.wipo.int/ipstats.
The data suggest that branded exports to China in particular continue to grow. Since 2015, China has led other countries for share of total classes in trade mark applications filed by Australians. In May 2014, China amended its trade mark law to bring it closer in line with international practice by allowing trade mark owners to file “multiple-class” applications, amongst other reforms. From 2015, Australians have used a steeply reduced number of applications to file trade marks in a rapidly increasing number of classes (Figure 16). The increase is attributed largely to filings in Alcoholic beverages (class 33) and Advertising (class 35).
Figure 16: Trade mark applications and classes, Australian-origin in China, 2009-18
Source: WIPO IP Statistics Data Center 2019. Retrieved 6 February 2020 from https://www3.wipo.int/ipstats.