Does someone use the same company name as yours? You do not have a registered trademark and you do not know what you can do in this case — the law does not leave you unprotected and you can defend your rights in various ways.
What is a name?
In Polish, the word ‘firma’ stands, colloquially, for an ‘entity’ — it doesn’t matter whether you are a sole proprietor or you run your business in another form of company. Initially, it is worth noting that a name (‘firma’) is just the name of your business. It individualizes entrepreneurs and makes it possible to identify them in business transactions.
A name is closely associated with the reputation and the brand of an entrepreneur. It is a representative and it performs many functions. The most important thing will certainly be individualization, promotion and recognition, which, when well-designed, can directly attract customers and generate significant profits.
A name is a personal right of an entrepreneur, which is subject to protection.
Right to a business name, i.e. protection of your company’s name
If you have not registered your name as a trademark, you may be entitled to the protection provided by the Civil Code in the event of an unlawful violation of your right to a business name. You need to look at three articles: 23, 24 and 41(10) of the Civil Code.
An entrepreneur whose right to a business name is threatened by another person’s actions may demand that such actions be ceased unless they are not unlawful. In the case of an infringement, the entrepreneur may also demand that the effects thereof be removed, that a declaration or declarations of the appropriate form and content be made, and that the financial damage be remedied in accordance with general principles or that the benefits obtained by the infringing person be returned. — Article 43(10) of the Civil Code.
The above provision is the main one you should rely on. It was separated from the whole list of personal interests. For this reason, entrepreneurs have a limited right to pursue their claims.
This provision gives us an additional advantage and indicates that the infringement must be unlawful. Unlawfulness must be taken into account objectively and extensively. This will be a violation of the entire legal order, i.e. the norms of law and the principles of social coexistence. Since there is a presumption of illegality in this case, it is for the infringing person to defend himself or herself and to prove that his or her conduct was not unlawful.
An infringement of a legal person’s name as this person’s personal interest may occur when not only the full name but also parts of it are used by an unauthorised person, where that part has a sufficient individualising function for the legal person to enable that person to be identified unequivocally and to be distinguished from other entities because the sign forming part of the name has, in itself, a sufficient distinctive character — judgement of the Supreme Court of 28 October 1998, file no. II CKN 25/98
The above Court’s decision was provided as an important curiosity. Very often, after all, an infringement of a business name is only partial.
Claims in the event of infringement of the right to a business name
You may be asked to refrain from such activity if:
- the infringement has not yet taken place, but there is a risk of it happening
- or the risk no longer exists but may reoccur.
However, if an infringement has already taken place, you can demand:
- that the infringement be discontinued;
- that the consequences of the infringement be removed;
- that a declaration of the appropriate form and content be made;
- that the financial damage be remedied in accordance with general principles;
- that the benefits obtained by the infringing person be returned.
I mentioned the limitations — in the case of an infringement of a person’s personal interests, you would still be able to demand compensation. The next laws that will be discussed here give greater freedom in this regard.
Business registration and the right to a business name
Having the right to a business name does not involve any additional registration or fee. Actual activities related to your market entry are important. An entry into the Register of Entrepreneurs is sufficient — have already done that anyway, because you have registered your business. If the infringement occurs earlier, your right to a business name arises at the latest when the business name is used for the first time in the business transactions.
The definition of an enterprise is as ambiguous as the one of an ‘entrepreneur’. However, the ‘entrepreneur’ is at least less problematic.
An enterprise is an organised set of tangible and intangible elements intended for conducting business activity. These include, among others, company designations, patents, copyrights, rights to movables and immovables.
If there is a doubt, the following provisions may also apply to individual entrepreneurs conducting business activity.
Protection of a band and designations an enterprise
The Act on Combating Unfair Competition and the provisions protecting the designation of enterprises are aimed at eliminating the possibility of misleading customers, consumers and other entrepreneurs as to the identity of the enterprise. They do not only apply to enterprises that compete with each other. Of course, the more similar the competition, the market and the so-called average customer are, the more likely it is that infringements will occur.
A designation of an enterprise is protected under Article 5 of the Act on Combating Unfair Competition which prohibits a designation of an enterprise which is likely to mislead customers as to its identity.
An act of unfair competition is such a designation of an enterprise that is likely to mislead customers as to its identity by using a business name, an emblem, an acronym or another distinctive symbol previously lawfully used to designate another business — Article 5 of the Act on Combating Unfair Competition.
The protection in the event of a competitor infringing the designation of an enterprise and thereby misleading people as to the goods, services and their packaging is based on the following provision:
- Such indication of products or services or its lack, which may mislead customers in relation to the origin, quantity, quality, components, manufacturing process, usefulness, possible application, repair, maintenance and another significant features of products or services as well as concealing the risks connected with their use, shall be the act of unfair competition.
- Releasing for free circulation products in the packing which may cause effects referred to in section 1 above shall be the act of unfair competition, unless the use of such packing is justified by technical reasons. — Article 10 of the Act on Combating Unfair Competition.
I will only discuss Article 5 as the main subject of this article. In order to be able to apply it, there must be three prerequisites in total:
- use of a particular designation by a competitor in business transactions;
- the right of priority of the entrepreneur seeking protection;
- the possibility of misleading customers as to the identity of the enterprise.
The Act on Combating Unfair Competition does not make protection dependent on any system of registration of designations, and the very element of risk of infringement is sufficient.
Differences between designations
As regards the very difference between the designations, it is how an average customer, not a professional in the industry, will distinguish the differences. It doesn’t have to be a similarity for all customers; only a few percent of them will suffice.
Many entrepreneurs believe that when they market a product with a name that sounds the same phonetically as a name of the competition, but is written otherwise, it will not be a problem. Unfortunately, this is a mistake. It is enough to have a similarity in one aspect only.
The discussed provisions on acts of unfair competition also apply to the brands of a given entrepreneur. Every designation of an enterprise, whether verbal, graphic, sound or olfactory, shall be protected. As a curiosity, it is worth noting that every website, the interior design of your store or an outfit you created for your employees may also be protected.
Claims relating to acts of unfair competition
If there is an act of unfair competition, the entrepreneur whose interest has been threatened or infringed may demand much more than it is stated in the Civil Code alone:
- that the illegal activities be discontinued;
- that the effects of the illegal activities be removed;
- that a single or multiple declarations of the appropriate content and form be made;
- that the damage be remedied in accordance with general principles;
- that the unduly obtained benefits be returned in line with general principles;
- awarding an appropriate amount of money for a specific social purpose related to the support of the Polish culture or protection of national heritage — if the act of unfair competition was culpable.
The burden of proof of the veracity of designations or information placed on products or their packing or of statements contained in the advertising shall fall — as in Article 43(10) of the Civil Code — upon the person accused of the act of unfair competition connected with misleading.
It is necessary to specify in detail the form and the circumstances under which infringements take place. You must collect all documents, e-mails, photos and other evidence relating to your case.
An interesting solution is that the court may also decide about objects directly related to committing an act of unfair competition — about products, their packaging, advertising materials and others. In such a case it the court may order, in particular, their destruction or include them on account of the indemnity. All this at the request of the entitled person, i.e. the entrepreneur in respect of whom the infringement was committed.
If your business name, e.g., in the form of a logo, is creative enough to be considered a work, copyright will also apply. In such circumstances, you are entitled to claims under Article 79 of the Act on Copyright and Related Rights, i.e. to demand, for example, that the infringement be ceased, the consequences of the infringement be removed, the damage be remedied, the obtained profits be returned as well as to demand that appropriate information be published in the press.
In the case of a company, remember to transfer the copyrights to a work to the company.
What should I choose? What should I do? — a summary
In conclusion, the registration of a trade mark remains the best solution. The granted protection gives you the exclusive right to use the registered designation. However, also in this case, limited confidence is necessary as this right can be rebutted. In the event of a conflict — a trade mark vs. an unregistered designation — the Supreme Courts may accede to the principle of priority.
In the absence of a registered trade mark, on the other hand, priority is given. During the process, it is highly likely that a competitor will point to an earlier use of the business name in conflict.
When we talk about the protection of enterprises, including their designations, it will still be possible to apply the provisions of the Act of 16 April 1993 on combating unfair competition. The specification of the right to a business name in Article 43(10) of the Civil Code does not limit other rights, e.g., the protection of other personal interests under Article 24 of the Civil Code.
Damage to reputation is a good example. Then the provisions on personal interests from the Civil Code will also apply. And when it comes to a designation of an entrepreneur, the Act on Combating Unfair Competition will also apply.
There is a view that an individual entrepreneur (a business name) should be distinguished from an enterprise, which in the case of infringement of one or the other will determine which provisions will come into use.
In the article, I have not raised the issue of the criminal liability that may occur for the described infringements. Articles 25 and 26 of the Act on Combating Unfair Competition and Article 286 of the Penal Code may be applied — a fine, a detention penalty or a custodial sentence may be imposed.
The provisions of the Act on Combating Unfair Market Practices may also apply to B2C.
I would like to note that I have not discussed all the nuances of the above issues. The article presents my views on this subject. It is only an outline of your rights and responsibilities towards the competition. If you wish to receive more information or a quotation for your order, feel free to contact me.
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