You Registered a Trade Mark Personally. Does Your Company Own It?

When you first start a business, registering a trade mark in your own name might seem like the obvious choice. It's your idea, your business and you're the one getting everything off the ground.

But a few years later, that small venture might have grown into a company, with employees, customers and a brand that's become increasingly valuable.

The trade mark, however, might still be registered in your personal name.

So, does your company actually own the brand it's been building? And if not, what should you do about it?

Does Your Company Automatically Own a Trade Mark You Registered Personally?

No. Incorporating a company doesn't automatically transfer a trade mark you registered personally into the company's ownership.

Under New Zealand law, a company is a separate legal entity from its founders, directors and shareholders. This means property you own personally doesn't automatically become company property simply because you've incorporated your business.

The same applies even if you're the company's sole shareholder and director.

If your company didn't exist when you originally registered the trade mark, it may have made sense to register it in your own name. However, incorporating later doesn't automatically change that ownership, even if the company becomes the main business using the brand.

You can check who is listed as the registered owner through the Intellectual Property Office of New Zealand (IPONZ).

It's also worth reviewing any existing agreements, particularly if you've brought on co-founders or investors. Previous assignments, contractual obligations and other rights associated with the brand may affect the legal position.

Why Does Trade Mark Ownership Matter as Your Business Grows?

If you're still running the company yourself, you might wonder whether the distinction really matters. After all, you're the one making decisions about the business and its brand.

Personal ownership might not cause any immediate difficulties. However, things can become more complicated as the company grows and other people become involved.

For instance, if you're seeking investment, potential investors may want to confirm that the company owns or has sufficient rights to use its intellectual property. If the trade mark belongs to you personally, they may ask for it to be transferred or for an appropriate licensing arrangement to be put in place.

Selling the company can also raise questions about ownership.

If you sell your shares in the company, a trade mark you own personally won't automatically transfer to the buyer or become company property. Its ownership would need to be addressed separately. If you're selling business assets instead, the position will depend on who owns those assets and what's included in the sale agreement.

There may also be complications if you leave the company or become involved in a shareholder dispute. The company could have spent years building recognition around the brand, while the registered trade mark remains in your name.

This doesn't necessarily mean the company has no rights to use the brand. Existing agreements, permission to use the trade mark and unregistered rights associated with the business's goodwill may also be relevant.

However, when ownership arrangements haven't been clearly documented, establishing what each party is entitled to do can become more difficult.

Can Your Company Use a Trade Mark You Own Personally?

Yes, potentially. Your company doesn't necessarily need to own a registered trade mark to use it.

As the registered owner, you can authorise the company to use your trade mark. One way to formalise this arrangement is through an IP Licence Agreement, which can set out the company's rights to use the brand while you retain ownership.

A licence can establish how the company is permitted to use the mark, whether that permission is exclusive, what controls apply to its use and what happens if the arrangement ends.

It can also address who is responsible for maintaining the registration and how decisions about the trade mark are made.

This becomes particularly important if you eventually step away from the company. Without clear terms, disagreements might arise over whether the business can continue using the brand or who has authority to make decisions about it.

An informal arrangement isn't automatically unlawful, but it may leave uncertainty about what was actually agreed.

Keeping the trade mark personally owned isn't necessarily a problem, provided the company has the appropriate rights to use it. However, as the business grows, it's worth considering whether a formal licence or a transfer of ownership would better reflect how the company operates.

How Can You Transfer Your Trade Mark to the Company?

If you want the company to own the trade mark outright, you can generally transfer it through a trade mark assignment. This involves legally transferring ownership from yourself to the company, usually through a written agreement such as an IP Assignment Deed.

Under New Zealand's Trade Marks Act 2002, registered trade marks and pending applications can be assigned to another person or entity, including a company.

For a founder transferring a trade mark to their company, this will usually involve preparing a written assignment agreement identifying the current owner, the company and the trade mark being transferred.

The agreement should establish which rights are being assigned and when the transfer takes effect. Depending on the circumstances, it may also need to address consideration, existing licences, associated goodwill and other relevant terms.

Before proceeding, it's worth checking whether any existing shareholder, investment or intellectual property agreements affect the proposed transfer. There may also be tax or accounting implications requiring separate professional advice.

Once the assignment is completed, the ownership change should be recorded with IPONZ through its online system, together with supporting evidence of the transfer. IPONZ currently charges no fee to record a trade mark assignment.

The assignment and updating the register are separate parts of the process. A valid assignment transfers the relevant rights, while recording the change ensures the register reflects the new owner.

For more information, see our guide on How to Transfer a Trade Mark.

What About Other Brand Assets You Registered Personally?

Your trade mark might not be the only business asset that's still owned or registered in your personal name.

When you're first getting started, you might purchase a domain name, commission a logo or create marketing materials before establishing a company.

However, transferring a registered trade mark doesn't automatically transfer ownership of these other assets.

For example, if you commissioned and agreed to pay a designer to create your logo before incorporating, you may personally own the copyright in that artwork under New Zealand's Copyright Act 1994, depending on the type of work and any agreement with the designer.

That copyright doesn't automatically become company property simply because the company starts using the logo.

Similarly, domain names, website content and other brand-related assets may be subject to separate ownership or contractual arrangements.

As your company grows, it's worth checking that it has the appropriate legal rights to the intellectual property it relies on, rather than assuming everything associated with the brand belongs to the company.

Key Takeaways

A decision you made when your business was just getting started might not reflect how it operates today.

Registering a trade mark personally isn't necessarily a problem, and it doesn't automatically mean your company can't use the brand. However, personal ownership and company ownership are legally different, even when you're the sole shareholder.

As your business grows, it's worth checking who owns the trade mark, whether the company has the appropriate rights to use it and whether those arrangements still make sense.

Depending on your circumstances, that might involve transferring the trade mark to the company or putting a formal licensing agreement in place.

If you're unsure who legally owns your business's trade mark, get in touch with our team on 0800 002 184 or team@sprintlaw.co.nz to discuss your options.