Trademark vs Trade Name vs Commercial Registration in Saudi Arabia: What Is the Difference?
Many people assume that recording their trade name in the commercial register protects their brand. In fact, the trademark, trade name and CR each have a different purpose, authority and scope of protection.
A trademark is the logo or name that distinguishes your goods or services, and it is registered with the Saudi Authority for Intellectual Property (SAIP). A trade name is the name by which the business itself is known, and the commercial registration (CR) is the official record of the business and its activity; both fall under the Ministry of Commerce. Holding a CR under a particular name therefore does not mean you own a protected trademark in that same name.
What is a trademark?
A trademark is any perceptible sign that distinguishes a business's goods or services from those of others. It may be a word, letters, numbers, a drawing, a logo or a combination of these. Its core function is to distinguish the product or service in the consumer's mind. A registration certificate gives the owner an exclusive right to use the mark within the registered classes, and the mark can be licensed, assigned or pledged in accordance with the statutory procedures.
What is a trade name?
A trade name is the name under which a business trades and which is recorded in the commercial register; it is governed by the Trade Names Law. Its function is to identify the business itself in its official dealings, such as contracts, invoices, signage and correspondence with government bodies. It must meet conditions set by the Ministry, such as not being identical to a name already recorded and not breaching public order.
What is a commercial registration?
The commercial registration is the official record at the Ministry of Commerce that establishes the business's legal existence and records its key details, such as its trade name, activity, owner or partners, capital and address. In many cases it is a requirement for carrying on commercial activity lawfully, but it is not a tool for protecting the identity of your products against competitors.
What is the difference between the three, in brief?
- Authority: Trademarks are handled by SAIP; trade names and commercial registrations by the Ministry of Commerce.
- Function: A trademark distinguishes goods and services, a trade name identifies the business, and the CR establishes its legal existence.
- Scope: A trademark is protected in specific classes of goods and services, while a trade name is tied to the business's registration.
- Form: A trademark may be a logo, a drawing or colours, while a trade name is a written name.
- Dealings: A trademark is an independent asset that can be licensed or sold separately from the business, in accordance with the law.
- International reach: A trademark can be protected internationally through the Madrid Protocol, whereas a trade name is recorded locally.
Is a commercial registration enough to protect my business name?
No. Imagine you open a bakery under a particular name and record it in the commercial register, and then someone else registers the same name as a trademark in the class for baked goods. They would then have an exclusive right in the mark for those products, and you could have difficulty using the name on your packaging and advertising. The best approach is to align your legal and commercial identity from the start, in this order:
- Search for the name in trademark databases before adopting it as a trade name.
- Record the trade name with the Ministry of Commerce.
- Register the name and logo as a trademark in the appropriate classes.
Can the trademark differ from the trade name?
Yes, and this is common. A business may have an official trade name and sell its products under one or more different marks, each registered separately. A food company, for example, may have a general trade name while selling juices under one mark and snacks under another aimed at a different audience. This variety gives the business marketing flexibility, but it requires careful management of the trademark portfolio and its renewal dates.
Likewise, a domain name or a social media account name is no substitute for registering a trademark. Domain names are registered with domain registrars and do not give an exclusive right to use the name on goods or services. Ideally, all these elements work together: a recorded trade name, a registered trademark, and a domain and online accounts under the same name.
Frequently Asked Questions
Q: Can a trademark be just a logo without words? A: Yes, a drawing or logo can be registered on its own if it is distinctive.
Q: If I deregister my CR, will my trademark lapse? A: A trademark is an independent asset with its own record at SAIP, but if the owning business ceases to exist, the status of the mark needs to be regularised, for example by transferring its ownership, so consult a specialist before deregistering.
Q: Do I need a commercial registration to register a trademark? A: It depends on who the applicant is and on SAIP's current requirements, so check them on the platform or consult a specialist.
FATIMA AL ASMARI Law & Intellectual Property Company in Jeddah helps you align your trade name with your trademark through its trademark protection and corporate legal consultation services, for clients across Saudi Arabia. Book a consultation or call +966 56 685 9556.
Legal sources
This article is for general awareness and is not legal advice.
