Introduction
Legal issues and risks
Legal protection for ship names
Legal protection for a fleet
A ship's name is first and foremost an element of identification, but it can be much more – it has great business value. If properly supported and valorised, it creates an association with the other vessels of the owner's fleet, meaning that it can be readily identified as being owned or operated by a certain shipowner in the shipping market. Essentially, it can enhance the value of the shipowner's business image.
Therefore, a ship's name, or at least a part of it, is frequently used as a distinctive element of the entire shipowning company.
To this purpose, a shipowner may characterise its fleet by inserting the following elements into the name of each ship:
- the initials of each ship in the fleet or other identifying letters of the shipowning company;
- the names of the family members of the company's founder;
- locations;
- historical figures' names; or
- events somehow related to the shipowner.
Adding such elements creates business value. However, with this value comes exposure to risks and legal consideration requirements.
In order to pursue a communications and marketing strategy based on ship names, the shipowner must be granted the exclusive use of the name that it has elected for its ship.
The shipowner will have to prevent the risk of a competitor exploiting the business value created by the distinctive vessel name.
In fact, a situation may arise where a shipowner gives its ship a name that is similar to the names of another shipowner's vessels with the intention of taking advantage of the market position of this competitor, hoping that the ship will be perceived as part of the well-reputed competitor's fleet.
This risk is even more tangible when the shipowner whose signs are emulated has a corporate organisation that is formed of a group of separate companies. This is because it would be easier for the emulating company to justify the existence of other legal entities (ie, not the shipowner's established companies) and to have a legitimate reason to be associated with fleet.
Legal protection for ship names
Under Italian law, the name of a single ship is regulated by article 140 of the Code of Navigation, which requires that the name of a ship must be different and dissimilar from any other ship name already registered with the Italian ship registry.
This implies that an Italian shipowner will be granted exclusive use of the name of its ship and that not even similar names may be adopted by competitors.
However, this provision applies only to vessels registered with the Italian ship registry. Therefore, an Italian shipowner would not benefit from such protection if the competitor's similarly named ship was registered with a different registry.
To resolve this issue, Italian shipowners that want to hold the exclusive rights to a particular ship's name may be able to register the ship's name as a trademark in all countries of interest.
For the distinctive elements that appear in the names of a fleet, and that characterise the relevant shipowning company, legal protection can be obtained by registering such distinctive elements as trademarks. Owners can therefore enjoy the strong remedies afforded by the relevant national and international rules (depending on the range of countries covered at the time of the trademark's registration) that grant the exclusive use of the trademark.
However, there are circumstances in which it will not be possible or convenient for a shipowner to properly register the fleet's distinctive signs that are included in the ships' names as trademarks. For instance, this may be the case if multiple registrations are needed (eg, when the characterising element is not a single trend and recurring sign) or due to the relevant costs.
In such situations, the shipowner may obtain protection by invoking the rules on unfair competition, in order to prevent a competitor making use of ship names that may create confusion on the market.
In this respect, article 2598 of the Civil Code expressly prohibits the market use of the distinctive signs of a competitor where such use could create confusion as to which company such signs refer.
This provision, which represents a form of protection against competitors' unfair behaviour, is a strong remedy for shipowners against any competitors willing to exploit the distinctive nature of ships' names to the advantage of their own fleet.
For further information on this topic please contact Arianna Perotti at Dardani Studio Legale by telephone (+39 010 576 1816) or email ([email protected]). The Dardani Studio Legale website can be accessed at www.dardani.it.