IP issues related to Internet domain names for SMEs

Aleck Ncube

THE choice of a domain name has become an important business decision. A domain name is registered by you to enable Internet users to locate your company’s site on the web.

Company domain names may be registered in any number of “top level domains” called “TLDs”.

You can choose from the “generic top level domains” (“gTLDs”), such as .com, .net, .org and .info. Or you can choose from the specialised and restricted top level domains if you qualify (e.g. .aero for air travel and transport businesses, or .biz for commercial enterprises).

You can also register your domain name under a “country code top level domain” (“ccTLD”), for example, .ZW for Zimbabwe,.CN for China, .ZA for South Africa.The technical management of the domain name system is in the hands of the Internet Corporation for Assigned Names and Numbers (“ICANN”).

However, in the gTLDs, the registrations themselves are handled by a number of Internet registrars accredited by ICANN,that can be found at ICANN’s site at <http://www.icann.org>.

For registrations in the ccTLDs, you will need to contact the registration authority designated for each ccTLD.

To do this, you can consult a ccTLD database set up by WIPO, that links to the web sites of 243 ccTLDs, where you can find information about their registration agreement, service and dispute resolution procedures.

When you choose your company’s domain name, depending on where you register, you may pick a generic or common name, but if you pick a name that is distinctive, users may more easily be able to remember and search for it.

Ideally, it could also be distinctive enough to be protected under trademark law, because domain names can be protected as trademarks in some countries.

If you picked a very common domain name (e.g. “Good Software”), your company could have difficulty in building up any special reputation or good will in this name and more difficulty in preventing others from using your name in competition.

You should pick a domain name that is not the trademark of another company, particularly a well-known trademark.

This is because most laws treat registration of another person’s trademark as a domain name as trademark infringement, also known as ‘cybersquatting’, and your SME might have to transfer or cancel the domain name, and also pay damages.

Also, all domain names registered in the gTLDs like .com, as well as many registered in the ccTLDs, are subject to a dispute resolution procedure that allows a trademark or service mark owner to stop the cybersquatting of their trademark.

There are various databases that you can search on the web to determine if your choice of domain name is a registered trademark in a particular country.

WIPO has established a Trademark Database Portal to help you do this search.

If you find that someone else is using your trademark or service mark as a domain name, what can you do?

Some unscrupulous people have made a practice of cybersquatting, usually to extract money from the rightful owner of the name or to mislead or confuse consumers.

If you find that your trademark or service mark is being cybersquatted, there is a simple online procedure you can go through where an independent expert will decide whether the domain name should be returned to you, and the registrars are required to follow this decision.

This Uniform Administrative Dispute Resolution Policy (“UDRP”) was first recommended by WIPO as a result of its Internet domain name processes and then adopted by ICANN.

In addition to trademarks, it is wise to avoid domain names that include certain other controversial words such as geographical terms, names of famous people, generic drug names, names of international organisations, and trade names, that might interfere with the rights of others or international systems of protection.

How your E-commerce business is affected by patents?

Patents are not just for large companies. Patents are not only for high technology. Some of the most successful E-Commerce companies have used patents for business methods and “low-tech” inventions.

Patents can help your E-Commerce business in a number of ways.

They motivate employees who enjoy challenges and who may benefit from remuneration or other benefits from the company.

They help record and develop new ideas. They can increase the valuation of your company in the context of investment, financing, merger and acquisition transactions.

They can support an increase in the price of your products by giving your company products exclusive features unavailable to competitors.

They can increase sales of your products by giving your company products exclusive features unavailable to competitors.

They can be a source of royalties in licensing transactions, thus adding revenues to your company bottom line.

Such royalties can be in a lump sum, in installments, based on units of product sold, or based on a percentage of revenues from sales of product.

They can permit your company, if it grants licences to the patent, to expand its markets and/or create a platform, whereby licensees develop and differentiate products based on the patent.

They can be used in connection with participation in standards bodies or consortia, where different companies join forces to create interoperability or promote a technology.

They can be used defensively in case your company is accused of violating the patent of another company.

You can protect your company from litigation and/or trade your patent against the accusing company’s asserted patent.

They can help your company develop strategic alliances with other companies who wish to take a licence to your company patents and thereby increase their own patent portfolios.

These benefits are not only for E-Commerce companies, but are especially important in E-Commerce.

This is because E-Commerce is closely linked to subjects that have recently, in countries where patent protection is available for these fields of technology, been the subject of vigorous patent activity: telecommunications, semiconductors, business methods and software.

Today, there are an increasing number of software and business methods which are protected by patents in the United States.

In Japan, computer programs and business methods are patentable provided that they are considered to be technical instead of merely abstract ideas.

Under the European Patent Convention and thepatent laws of a number of countries, Zimbabwe included, computer programs and business methods are still expressly excluded from patent protection.

Patents in E-Commerce are important because of the amount of licensing, contracting out, outsourcing, and strategic relationships involved in E-Commerce.

Patents are usually first filed in your own country’s patent office, but also in most other countries, anyone can file a patent in the respective national patent office or use, where the conditions therefor are fulfilled, the International Bureau of WIPO for patents filed under the Patent Cooperation Treaty (PCT).

Using the PCT gives you options to file patent applications in a number of countries.

There are also regional patent offices, for example, the European Patent Office (EPO) and the African Regional Intellectual Property Organisation (ARIPO).

In the next write up, I will focus on, distribution of content on the internet, Online Contracts, IP concerns about international transactions in E-commerce. Zimbabwe is Open For Business.

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