Trademark Infringement: Why Small Businesses Must Avoid Copying Established Trade Names

In the competitive world of business, building a unique brand is essential. For small businesses striving to stand out, it may be tempting to borrow elements—such as trade names or logos—from already successful companies. But doing so can lead to serious legal consequences. In the Philippines, this act falls under trademark infringement, and it is a violation that can cost a business more than just money. Worse, it can cost business credibility, future growth, and legal standing.

This article discusses what constitutes trademark infringement, its legal implications, and why small businesses must create original, legally distinct identities.

What is a Trademark?

A trademark is any visible sign capable of distinguishing the goods or services of an enterprise, including words, logos, symbols, or combinations thereof. It is protected under the Intellectual Property Code of the Philippines (Republic Act No. 8293).

When a business registers its trademark with the Intellectual Property Office of the Philippines (IPOPHL), it gains exclusive rights to use that mark in connection with its goods or services. This legal protection allows business owners to prevent others from using confusingly similar marks.

What is Trademark Infringement?

Trademark infringement occurs when a person or entity uses a mark that is identical or confusingly similar to a registered trademark without the owner’s consent, especially when such use is likely to mislead consumers.

Examples of infringement include:

• Using a business name nearly identical to a well-known brand

• Using a similar logo, packaging, or slogan that causes brand confusion

• Registering a business name with the DTI that mimics a protected trademark

Even if the infringer claims to have no intent to deceive, the likelihood of confusion is sufficient ground for legal action.

Legal Consequences of Infringement

Under Section 155 of the Intellectual Property Code, the trademark owner may file a civil case for:

• Injunctions (to stop the use of the infringing name)

• Damages, including profits lost due to confusion

• Destruction of infringing goods or marketing materials

In some cases, criminal liability may also attach, with penalties of fines and imprisonment.

Further, DTI may cancel or reject the registration of a business name if it infringes on a registered trademark.

Why Small Businesses Must Avoid Copying Established Names

While it may seem harmless or even strategic to adopt a name similar to a known brand, it is legally risky and often backfires. Here’s why:

a. Loss of Credibility

Using another brand’s identity can cause potential customers to question your business ethics and originality.

b. Legal Exposure

Once discovered, the legitimate trademark owner may pursue legal remedies, leading to financial loss and forced rebranding.

c. Business Disruption

If your business is ordered to cease using the name, you’ll face the costs of changing branding materials, domains, signage, and marketing efforts.

d. Barrier to Growth

Investors, clients, and partners prefer businesses with clear, original branding. Trademark disputes may deter expansion or funding opportunities.

Tips for Small Businesses: Brand Legally and Wisely

• Conduct a Trademark Search: Before choosing a business name or logo, check for existing trademarks at www.ipophil.gov.ph.

• Register Your Mark: Secure your brand legally through IPOPHL registration.

• Avoid Sound-Alike or Look-Alike Brands: Create an identity that reflects your unique value, not someone else’s success.

• Seek Legal Advice: Consult with an IP lawyer to ensure you are not infringing on any rights and that your brand is fully protected.

Trademark law protects not just the rights of established brands but also fosters healthy competition and innovation. For small businesses, the best way forward is to build an identity rooted in authenticity, originality, and legal compliance.

At GC Law, we guide startups and growing businesses in creating legally protected brand identities—because your name is your legacy.