Why Trademark or intellectual property is so critical for Startups?

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Intellectual Property (IP) are those properties which make references to the creations of the human minds for which complete rights are identified. Innovators, creators, artists and business owners are allowed/granted certain exclusive rights to various intangible assets for a given time period.

For instance:

  • Business owners are allowed some exclusive rights on the utilization of their trademarks and geographical indications which were established by the business owners
  • Creative artists are given copyrights on musical, literary, dramatic and artistic works for their creations and
  • Innovators are given protection for their patents, industrial designs, trade secrets, and designs of integrated circuits for their creations.

Types of Intellectual Property (IP)

  • Copyright– This is a legal term which is used to describe the rights that the creators have over their work.
  • Patents– This is a special right granted for an invention. Generally, a patent provides the owner with the right to decide how or whether the invention can be used by others or not.
  • Trademarks– This is a sign which has the potential to distinguish the goods or services of one enterprise from those of other the other business organizations. Trademark registration was used in ancient times when the creators used to put their signature or “unique mark” on their products.
  • Industrial Design– An industrial design constitutes the decorative or attractive aspect of an article. A design may consist of 3-D attributes, such as the shape or surface of an object, or of two-dimensional features like patterns, lines, dots or color etc.
  • Geographic Indications– Geographical indications of origin are special signs used on goods that have a particular geographical origin and possess qualities of that region, a reputation, and features that are important attributable to that place of origin. Commonly, a geographical indication has the name of the place of origin of the goods.

Importance of IP(Intellectual Property) for Start-ups

When entrepreneurs begin on their unique business idea, they have no doubt that their idea would be a commercial success in the market; their main focus is initially to start giving the appearance to the venture.

In the middle of so many different things that go into starting and building a startup from a single idea, the word ‘Intellectual Property’ (IP) is generally not just their main focus. And even if they think about IP protection, it seems to be too costly for a startup to work on.

Entrepreneurs should remember that evaluating IP implications is not just about protecting the work you are doing but, it is also very essential to check whether someone else has an IP for the same work. Very often, there could be people in different parts of the world working on the same idea.

Importance of IP protection

In today’s competitive and fast growing environment, IP can be a Unique Selling Proposition (USP) of the goods or services which will help to create a sustainable and protective differentiator for the company.

By owning an IP, a high obstruction is created, thereby helping you to develop your venture faster and more efficiently. IP is always given high weightage by the investors and therefore, it creates a good reputation for your venture. Moreover, IP has been identified as the main ingredient for startups across the world to get a competitive benefit in the market.

IP presume even greater importance for technology startups, where new innovations are being made almost every day. There is a very significant brand value devoted to IP, in both the manufacturing and technology fields. It gives creators, clients, and other stakeholders a great sense of confidence in your dedication, passion, and commitment to not just succeed, but also become a market leader in your field of business.

There are three significant ways in which a startup can protect its intellectual property:

1) Patents
2) Trademarks
3) Copyrights 

Intellectual property is an asset for it’s the creator and has a commercial value with it.

Protecting IP requires power, idea, and strategy. In many situations, it may be feasible to seek a trademark protection or simply conserve through a trade secret. This can be done by investing in the marketing and generating a recall between the product and the owner. There are various different strategies which are available for different type goals and ideas. Intellectual property can be very valuable for a start-up. If IP is correctly and strategically conserved, it can take the valuation of a company to a completely another level.

If someone else happens to do so before you, then you are likely to be out of the competition even if you had started working on the idea first.

What is difference between Trademarks, Copyright and Patent (other intellectual property)?

trademark munim

The term Intellectual Property (IP) introduces to a number of rare kinds of creations of the mind for which a number of unique rights are recognized. Owners are given clear cut, unique rights to a host of intangible assets, which can be literary, artistic or musical works, sports, discoveries, inventions, designs, symbols, words, and even phrases. A few examples of ordinary kinds of intellectual property are trademarks, copyrights, patents, and trade secrets. Intellectual property rights are more significant since they guard the rights of the owners of intellectual property to make money from their own created property, thus challenging others to come up with intellectual property of their own.

The differences amongst various Intellectual Properties are listed here under:

Trademarks

Trademarks are unique symbols or signs that individuals, an organisation, or other legal entities use. They use these unique symbols or signs to broadcast their services or products to the consuming public that are joint with the trademarks stem from a distinctive source. Trademarks are also used to distinguish services or goods from those of other legal entities. Trademarks are generally labeled by three different symbols based on whether they are unregistered, registered, or simply unregistered service marks. If trademark violations occur, owners of a registered trademark have the option of registering a lawsuit to clear off any unauthorized usage of the trademark the owner owns. Generally, trademarks can be symbols, logos, names, phrases, words, images, designs, or even a mix of any of these elements.

Copyright

A copyright is the best thought of as a group of unique rights that are bestowed upon the creator of an original work. This includes the transformation of the work, the circulation of the work, and the actual copying of the work. It is very important to comprehend that a copyright does not guard the ideas, but only their expression. Owners of copyrights have unique rights to copy and other advantages of their work, but only for a limited period of time, after which the copyright expires, bringing the work into the public domain. At the beginning, copyright law was only applicable for books, but this soon continued to derivative works and other translations. Today, a copyright is applicable to a big variety of works like music, maps, paintings, dramatic works, sound recordings, photographs, computer programs, and motion pictures.

Trade Secret

A trade secret can be a practice, process, formula, pattern, design, or a compilation of information which is not well-known or possibly attainable. A trade secret is also generally something by which an organization can get an economic profit over its competitors or its consumers. Two other expressions for trade secrets are classified information and confidential information. The significant part of a trade secret is based on these three factors. The three factors are the secret information which is not generally available to the general public, the broadcasting of a kind of economic profit to its share holders, and being subjected to demonstrable efforts to have its mystery maintained. Companies can guard themselves from their trade secrets being compromised by ensuring they have non-disclosure or non-compete provisions with their employees.

Patent

A patent is characterized as a group of unique rights that a national government delivers to either an inventor or whom the owner has assigned for a limited period of time, provided that he publically admits the invention. In most cases, an application for a patent has to include a claim that characterizes the invention. Invention has to be industrially applicable, useful, new, useful, and non-obvious to the general public. Patent rights means that other people are not allowed to use, make, sell, or distribute the invention without any prior permission of the inventor or the owner. If a current patent happens to fall within the range of an earlier patent, then that proprietor does not have the exclusive rights to use the patented invention

Why Sell Your Products Online or Provide Service Online

Online Selling

Today, a world without online businesses is hard to imagine. While customers experience the conveniences of buying online, lakhs of Indian sellers or service providers enjoy the convenience of selling online. Compared to owning a physical store or office and waiting for customers or clients to come and buy products or order service; online selling saves time, broadens reach and increases shopping / supplying hours. It’s a WIN-WIN situation for both the clients and service providers.

So, we have compiled top benefits of selling or providing service online:

  1. No huge investments: When you sell online, you don’t need a huge capital investment to start a business. You don’t need to pay rent or hire a workforce to take care of your physical store or constantly have excess inventory to put on display. You don’t need to print flyers, posters or hire expensive hoardings, to get customers. Similarly, for the service providers to provide online service, you do not need to have a physical office or capital on that account.
    All you need to do is register yourself on Munim.in, as a Professional and list your charges against already listed services and wait for your orders to start flowing. Apart for providing your service, everything else can be managed by Munim.in; be it marketing, ensuring payments, converting orders etc. Additionally, Munim will also bring in direct feedback from your clients, based on which you can make changes in your service pattern to make it even better.
  2. No limit on shopping hours: When doing an online business, you don’t have to worry about long days and keeping business open at odd hours. This is an advantage to both the sellers and buyers, who can render and order service all day, all night from the comfort of their homes or offices. Professionals can have their entry open 24×7. Online selling comes with time flexibility which gives sellers more time to concentrate on the important parts of their lives.
  3. No limit on audience: Can an offline service provider in a small remote North Indian town ever think of selling across South India? Not likely. But a Professional providing service on Munim has the advantage of selling across the country and states. Clients are no longer limited by where your office is located or where they live. Online selling can potentially reach everyone. At the same time, more reach promotes more visibility, more clients, and in turn, more business growth.
  4. No physical presence required: An online service provider doesn’t have to be physically present to monitor a office, guide staff or run his/her business. He/she can potentially run the business from anywhere, anytime using a laptop or a smartphone. It does not matter if you are a service provider from Delhi, you can be in a business meeting in Kolkata, or on a beach in Goa and easily monitor your business on the Professional Profile.
  5. No Order Management Complications: Keeping files as per the Order can be a bit hectic and specially at the time of compliance when you need to reconcile the orders. With Order Management available at Munim.in, this problem is nearly solved. Now Service Providers at any point of time can check their orders and payments.

However, if you provide service online, you can easily do away with all these hassles. If these stress-free benefits of setting up an online business excite you, then start providing your Professional Service with Munim.in.

What is HSN Code in GST

What is HSN code?

HSN (Harmonised System of Nomenclature) is an internationally accepted product coding system. In India, HSN coding is currently used under Excise, Customs, and state Value Added Tax (VAT) laws and is now also proposed to be used under Goods and Services Tax (GST) law, for classification of products/goods.

Codes under GST

Under GST law, the HSN code to be used by a taxpayer for classification of goods will be based on the taxpayer’s turnover. The HSN code needs to be declared on the tax invoice and also to be reported while filing the GST returns.

The HSN codes for mandatory mapping/classification of goods that need to be used by a taxpayer are as follows;

  • Taxpayers whose turnover is Rs. 5 crore and above shall use 4 digit HSN code,
  • Taxpayers whose turnover is above Rs. 1.5 crore but below Rs. 5 crore shall use 2 digit HSN code,
  • Taxpayers whose turnover is below Rs. 1.5 crore are not required to mention HSN code in their invoices.
  • The draft list of HSN codes released and available in the public domain can be assessed on the government GST website.
  • Under the GST laws, the services will be classified as per the Services Accounting Code(s) (SAC).

2-digit HSN code for goods

The taxpayers with turnover between Rs. 1.5 crore and Rs. 5 crore in the preceding financial year, need to specify HSN codes only at 2-digit chapter level as an optional exercise for the first year of GST operations. From the second year of GST operations, mentioning 2-digit chapter level HSN code will be mandatory for all taxpayers with turnover between Rs. 1.5 crore and Rs. 5 crore in the previous financial year.

4-digit HSN code for goods

HSN code of 4 digits will be mandatory for taxpayers having turnover more than Rs. 5 crore in the preceding financial year. Turnover will be considered on the basis of taxpayer’s self-declaration for the first year. After completing the first year under GST, the turnover for the previous year will be considered for determining the use of 4-digit HSN codes.

8-digit HSN code for export and import of goods

HSN codes of 8 digits are mandatory in case of export and imports of goods.

Benefit of HSN codes

When goods and offerings are recognised via their specific HSN codes, which are globally acceptable, the identification of goods becomes easy, and resultantly possibilities of misinterpretation tend to reduce. While filing GST returns online, HSN code in respect of the supply of goods and Services Accounting Code in respect of the supply of services will have to be uploaded, and there will be no need for entering the description of the goods or services while filing GST returns.

Trademark Rules 2017: A Significant Leap

Trademark Registration Munim

The Government of India in its initiative to draft a new set of rules which are in calibration with the aim of fastening the procedure of trademark filing in India and scraping out the possibilities of delays in this procedure. A notification regarding the draft rules for Trademarks was published by the Government of India in November 2015 inviting objections and suggestions.

After a thorough study of all such suggestions and objections, the Central Government has framed the Trademark Rules 2017, thereby replacing the Trademark Rules 2002. These rules came into effect on 6th of March 2017.

In order the achieve its objectives, these are the major changes brought in by the Government of India:

CATEGORIZATION OF APPLICANTS

The foremost major that has been brought in by the Trademark Rules, 2017 is that now there is a clear categorization of the applicants and the fees will be charged as per the applicant’s category, the categories are:

A) Individual/Start-up/ Small Enterprise : In the new rules they have specifically defined what would constitute a start-up and a small-enterprise. The definitions for the same have been given in Rule 2 (v) and (x).

START UP- “the enterprise engaged in the manufacture or production of goods, where the investment in plant and machinery does not exceed the limit of INR 10,00,00,000 (Rs 10 Crore) and in case of an enterprise engaged in providing or rendering of services, where the investment in equipment is not more than the limit of INR 5,00,00,000 (Rs  5 Crore)”

SMALL ENTERPRISE-“an entity, incorporated or registered in India, not prior to five years, with annual turnover not exceeding INR 25,00,00,000 (Rs 25 Crore) in any preceding financial year and working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property. However, if any entity formed by splitting up, or reconstruction, of a business already in existence, it will not be considered as a startup and also, an entity shall cease to be a Startup if its turnover for the previous financial years has exceeded INR 25 crore or it has completed 5 years from the date of incorporation/registration. A Startup needs to obtain certification from the Inter-Ministerial Board.”

DIGITIZATION OF TRADEMARK PROCESS

In order to digitalize the entire trademark process, every applicant is required to provide a valid e-mail address along with the postal address in India. The new rules particularly Rules 14, 17 and 18 specifically talk about services via e-mail. The aim is to make the entire trademark registration process virtual.

CHANGE IN APPLICATION/REQUEST FEES

The 2017 rules have increased the application fees substantially. Majorly all applications/request fees have been increased by 100%. However, a concession on fees of 10% is available in case of E-Filing for promoting E-filings.

Moreover, the categorization of the applicant has also been used to determine the Fees. For example, the Applicants of Category A as above, are being charged Rs 4500 as Application for Trademark Registration.

REDUCTION IN FORMS

The biggest change is in the reduction of forms. Earlier there were a total of 74 forms relating to trademark applications/request and now it has been reduced to a total of 8 forms.

WELL-KNOWN TRADEMARK

Now with the new rules an application can be made for declaring your trademark as well-known trademark. The registrar on receiving such request will call for oppositions within 30 days. Incase it is established to be well-known publication for the same will be made in the trademark journal and it will be included in the well-known trademark list.

SOUND MARKS AND 3-D MARKS

The new rules have provided an application for registering sound marks and 3-D marks as trademark. This is a very big change as sound marks and 3-D marks are now capable of being registered and can be called as trademark.

EXPEDITED PROCESS

Another major change brought about in the new Rules is the provision for expedited processing; the entire trademark procedure can be expedited. Under this, the entire procedure including examination, reviewing of reply to examination report, appointment of hearings, advertisement, and opposition, until final disposal of the application would be fast-tracked.

HEARINGS THROUGH ELECTRONIC MEDIA

This is another change which is brought in for promoting digitalization, now hearings of various trademark applications can be done through video-conferencing or through any other audio-visual communication devices and this shall be deemed to have taken place at the appropriate office.

LIMITATION ON ADJOURNMENTS

Limitation on adjournments for any hearing or decision had been made to two and this adjournment should not exceed 30 days.

EXTENDED RENEWAL TIME

The new rules have extended the renewal time from 6 months to one year. Now renewal of a mark can be done 1 (one) year prior to the expiration of its registration.

NO EXTENSION TIME IN FILING OF EVIDENCE

The new rules have become little stringent for filing evidence in opposition proceedings. Now delay in such filing will not be accepted whereas in the old rules extension of one month along with respective fees was given.

ASSIGNMENT FEES

The new rules have now affixed a few of INR 9000 for all assignment of registered trademark irrespective of the fact whether assignment request is made within 6 months/12 months/after 12 months from the date of assignment.

These changes are substantial changes which will help the system for Trademark Registration in India function more effectively and smoothly. These changes will definitely simplify the entire Trademark Process and encourage more businesses to get their trademarks registered.

What you Do not know about Trademark, Why Trademark Registration?

Trademark Registration

Even if you don’t realize it, everyone deals with trademarks on a daily basis. “Trademark” is another way of referring to brands.

Consumers’ purchasing decisions are influenced by trademarks and the reputation such brands represent. It is important for business people to have an understanding of why trademarks are important assets and help grow their business. 

Trademarks are an effective Communication Tool.

In a single brand or logo, trademarks can convey intellectual and emotional attributes and messages about you, your company, and your company’s reputation, products and services. Your trademark doesn’t need to be a word. Designs can be recognized regardless of language or alphabet. The Puma design is recognized globally, regardless of whether the native language is Hindi, Chinese, Spanish, Russian, Arabic or English.

Trademarks make it easy for Customers to find You.

The marketplace is crowded and it’s hard to distinguish your business from your competitors. Trademarks/brands are an efficient commercial communication tool to capture customer attention and make your business, products and services stand out. Customers viewing a trademark immediately know who they are dealing with, the reputation of your business and are less likely to look for alternatives. Your brand could be the critical factor in driving a customer’s purchase decision.

Trademarks Allow Business to effectively Utilize the Internet and Social Media

Your brand is the first thing customers enter into a search engine or social media platform (Facebook, Twitter, Instagram, LinkedIn) when looking for your products and services. Higher traffic on a website or social media platform translates into higher rankings, bringing even more traffic, more customers and more brand recognition.

Trademarks are a Valuable Asset

Trademarks can appreciate in value over time. The more your business reputation grows, the more valuable your brand will be. Trademarks provide value beyond your core business. Trademarks  can lead the way for expansion from one industry to another, such as from personal care to clothing or eye ware. If you desire it, your trademark can lead to the acquisition of your business by a larger corporation. Trademarks are a property asset, similar to real estate, that can be bought, sold, licensed (like renting or leasing) or used as a security interest to secure a loan to grow your business.  

Trademarks cab make Hirining Easier

Brands can inspire positive feelings in people’s minds. As a result, employment opportunities are more attractive to candidates. Employee retention can be higher if employees have positive feelings for the brand and the products and services offered.

Trademarks are a bargain to obtain

Trademark Application Fees is just Rs 4500 for Individual, Small Company, LLP, Partnership. Thus, it is just a matter of few buck and a protection to your Brand.

Trademarks never Expire

Your trademark will not expire as long as you are using it and renewing it with Authorities after every 10 years. 

Brands are a critical asset. Do your due diligence before investing a lot of time and money in launching a new brand and most important is Naming your New Brand. Be sure the brand fits your company. Obtain a clearance search to make sure your new brand is available and doesn’t infringe on anyone’s prior rights.

Keep in mind that the more you differentiate your brand from others in your industry, the easier it’ll be to protect. Choose a name and logo that distinctly identify your business and will protect it from competitors. Utmost importance is Check Trademark (Munim.in Footer Trademark Seatch) availability before starting the brand building exercise. 

Munim.in is an online marketplace for services like Company Registration, Trademark Registration, LLP Registration etc. Munim.in connects Service Seeker with the verified Professionals and allows placement of order through the platform to avail Munim Guarantee. 

How to Name Your Startup

name your startup

Several Times we have faced this question from various startups that comes to Munim.in for Trademark Registration or Company Registration that what things should we keep in mind before naming a company, How to name the startup or brand, what all things to do to name the startup.

Several times, we have faced the situation wherein the Startups in the very beginning name the company without research in the legal directories and later on when they apply for Trademark Registration or Company Registration, they face difficulty in getting the desired name on which they have marketed the product.

A Clear Suggestion, Avoid This Situation.

It is to be understood that its just a one time cost (may in terms of time) to zero down to a great name but the benefit is forever.

It is to be understood that its just a one time cost (may in terms of time) to zero down to a great name but the benefit is forever.

Here we present, a list of Do’s and Don’ts while deciding on the Name of your Startup or Brand:

1. Make sure it’s legal and not being used!  This should be obvious, but it’s an important step that too many entrepreneurs skip.  Before attaching yourself to a name, make sure that someone else doesn’t already have claim to it by way of a trademark.  You should take a quick look at Trademark Search (available at Munim.in Footer). The good news is that if you satisfy some of the other conditions below (domain name, twitter handle, Facebook name), odds are relatively low that someone’s already using the name.

2. Hint At What You Do:  You have two paths to go when picking a startup name.  You can pick a name that is “synthetic” and made-up (example: Quora) or you can use somthing that is somewhat descriptive of what you do (example: Snapdeal or flipkart).  Synthetic names are often great in the long, long-term (easily trademarkable, and you can truly “own” them and infuse them with meaning).

3. Make it easy to remember: How do you know whether a startup name is easy to remember?  You don’t know.  So, test it.  Talk to people.  Describe the company.  At the end of a 2–10 minute conversation, casually ask them if they remember what the name of the company is.  If it didn’t “register” it’s not a failure on their part (and make sure to tell them that), but a failure on your part for not having something that’s memorable enough.

4. Make it unambiguous when spoken:  A quick way to test this is to ask friends and family what they think of the name over the phone — and ask them to spell it back to you.  If a decent percent of them get it wrong — or are uncertain, you’ve got a problem.

5. Make it unambiguous in Google:  If your name is something like “Pumpkin”, you’re going to have a harder time distinguishing when people are talking about the generic term, or when they’re talking about your company.  Of course, there are plenty of examples where a startup started with a generic word and went on to be pretty successful (Mint.com jumps to mind).  That’s why these are suggestions (not laws) and they’re changeable.

6.  The social media handles have to be available.  No tricks with numbers and underscores and stuff.  You want the most natural, obvious twitter handle that matches your company name.  This is not quite as hard as .com domain names — but getting harder every day.

7. Keep it short.  Always good advice, but particularly true in the age of Twitter/facebook.  The more characters in your company name, the more characters in the tweets that people write that mention your company name.  The fewer the syllables, the easier it is for people to say.  Great examples of one and two-syllable names:  Dropbox, Mint, FreshBooks, ZenDesk. 

8. Try to get your main keyword into the name.  This helps with SEO and signals to potential visitors what they might find on your site.  For example, one of sites is YourStory.com.  Not particularly creative, but you have to admit — it’s clear.  (And, is likely partly responsible for my high rankings in Google for a bunch of startup related words).

9. Don’t name your company after yourself.  When customers hear something like “Ramesh Sharma Enterprises”, it doesn’t make them immediately think “Wow, that must be an awfully cool/successful/stable company”.  It sounds a bit amateurish right at the get go.  The other reason is that if you name the company after yourself, too many people are going to want to talk to you.  That’s ok when you’re the only person in the company to talk to, but becomes problematic as your startup grows and there are other people trying to sell/support/market.

10. Don’t Use An Acronym:  It’s hard to get emotional about a three letter acronym.  It’s hard to hug an acronym.  As a corollary to this, try not to have a company name with three words in it, because it’s long enough that people are going to be tempted to reduce it to an acronym.

11. Have a story.  When someone asks (and they will), so why did you pick X for your name, it’s nice to have something relatively interesting to say.  Names are a part of your personality, and the absence of a personality is rarely a good thing.  It’s OK to be purely scientific in your name selection, but a good story never hurts. 

12. Pay attention to character sequences in multi-word names:  This one’s a bit subtle.  But, if you have a name that is two words stuck together, then be mindful of what character ends the first word, and what starts the second.  Example: If your company name is something like BetterReading, it’s sub-optimal (because Better ends with “R” and reading starts with “R”.  Normally, that’s OK, but when you type it out as a URL, people will often see:  betterreading.com — which is not terrible, but does cause the brain to “pause” for a micro-second because it feels a tad unnatural.  And, I’d be remiss if I didn’t bring up the widely popular example of unfortunate character sequences:  expertsexchange.com.  When capitalized properly, this name is just fine (ExpertsExchange) which is what the site owners intended.  But, it turns out, this can be confused as “ExpertSexChange” (which is not what was intended).  Make sure you think through the combinations properly.

13. Seek timeless instead of trendy:  It seems that every generation of startups has their own “trendy” approach to names.  Examples are the dropping-vowels thing (like Flickr), the breaking up of words (like del.icio.us) or the newly fashionable “.ly” names. Pick a name that is timeliness.  One that people will see 10 years from now and not think “Hey, they’re one of those companies…”. 

So try to think on these lines while naming your startup offering and believe that getting a name registered through Trademark Registration is very very important.

Do remember the case of Foodiebay rechristened to Zomato, because ebay in its name being one of the reasons and the name was not Trademark registered

Munim.in is a marketplace for professional services like company registration, trademark registration and other related services.