How can franchisors protect their intellectual property (eg, trademarks and copyright)?
Benelux trademarks must be registered through the Benelux Office for Intellectual Property and EU trademarks must be registered through the Office for Harmonisation in the Internal Market. The registrant of a trademark obtains an exclusive right to use the trademark in Benelux or the European Union, as relevant.
Copyrights do not require registration. A work can be eligible for copyright protection if it meets the requirements for copyright protection – meaning that the work has its own original character and bears the maker’s personal stamp. The work must be the result of creative human labour and thus creative choices.
Trade names do not have to be registered to qualify for trade name protection under the Trade Name Act.
Must IP licences be registered?
There is no legal requirement to register IP licences. Registration of a trademark licence enables franchisees to:
- intervene in enforcement actions undertaken by the franchisor (as trademark owner); and
- bring its own claim for compensation or profit remittance.
How can franchisors protect their know-how and trade secrets?
Dutch law includes no provisions that deal specifically with trade secrets and undisclosed know-how. Article 39(2) of the Agreement on Trade-Related Aspects of Intellectual Property Rights is deemed to be incorporated into the Dutch Civil Code in the general article on torts (Article 6:162). In the absence of eligibility for specific IP rights protection, protection of data can be sought through the use of non-disclosure agreements.
What are the consequences of a franchisee’s breach of the franchisor’s IP, know-how or trade secret rights and what remedies are available to the franchisor in this regard?
The misappropriation of intellectual property, know-how or trade secrets often constitutes a breach of the agreement’s licence and confidentiality provisions. Such a breach would, in principle, allow the franchisor to terminate for breach and claim damages.
Infringement of the abovementioned rights by the franchisee can also result in the franchisor bringing suit to obtain provisional measures designed to cease all infringing use. Said claim can also be strengthened with court-appointed penalties.
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