Mind the gap: what the trade mark register isn’t telling you

Most businesses know that changes in ownership of a registered trade mark should be recorded at the relevant trade mark office. Fewer pay the same attention to what happens after a trade mark is licensed.

That is understandable. A UK trade mark licence does not generally have to be registered in order to be valid. The commercial agreement is usually negotiated, signed and filed away. Particularly where the licence is between companies in the same group, recording it at the trade mark office can easily look like unnecessary administration.

A decision of the Court of Appeal earlier this year shows why that approach deserves another look.

In Lifestyle Equities CV v Frasers Group Trading Ltd [2026] EWCA Civ 583, the failure to apply in time to register a series of trade mark sub-licences had a direct consequence when damages were assessed. Losses suffered by the relevant sub-licensees could not be recovered through the trade mark proprietor’s infringement claim.

The point is important in itself, but the wider question is whether the public record of a trade mark portfolio still matches the way the business actually owns and uses its brands.

What happened in Lifestyle?

The case concerned the BEVERLY HILLS POLO CLUB trade marks. Lifestyle Equities CV owned the relevant marks, Lifestyle Licensing BV was the exclusive licensee and various other businesses operated under sub-licences.

Most of those sub-licences had not been registered.

The claimants had already established infringement in an April 2018 judgment. The problem arose much later, during the subsequent inquiry into damages, when Lifestyle Equities sought to include the sub-licensees’ losses in its claim. The defendant applied for summary judgment to strike out that part of the claim. The High Court initially rejected that application, but the Court of Appeal reversed it.

Section 25 establishes a voluntary system for recording transactions affecting registered trade marks, including licences, assignments and security interests. Section 30 gives licensees certain rights and protections where a registered trade mark is infringed. In particular, where the proprietor brings infringement proceedings, section 30(6) requires the court to take account of loss suffered by a licensee.

The Court of Appeal held that this protection is not available until an application has been made to register the licence.

That applied even though it was the proprietor, rather than the licensee, seeking to recover the loss. It was therefore not possible to sidestep the registration requirement simply by putting the licensee’s loss into the proprietor’s damages claim.

There was a further problem. Although a licence can be registered late, the ordinary rules on limitation still apply. Registration cannot be used to resurrect a claim which has already become time-barred.

The result was that the relevant claims for the sub-licensees’ losses failed.

A problem that may not appear until years later

Nothing necessarily goes wrong when an unregistered licence is signed. The licensee can use the mark. The parties can perform the agreement. Products can be sold and royalties paid for years without the state of the register attracting any attention.

The problem may surface only when an infringer appears, the business is sold, an investor begins due diligence, finance is raised against the IP, or a historic group restructuring has to be reconstructed several years later.

By then, correcting the register may not cure everything that has happened in the meantime.

Lifestyle is a good example. The relevant infringements dated back to 2014 and 2015. The dispute over the effect of the unregistered licences reached the Court of Appeal more than a decade later.

Trade mark housekeeping can have a very long tail.

Intra-group licences deserve particular attention

The decision is especially relevant to corporate groups.

It is common for valuable trade marks to be held in one group company and used by another. Sometimes that is deliberate. An IP holding company owns the portfolio and licenses the operating companies. In other cases the structure has simply developed over time following acquisitions, reorganisations or changes in trading entities.

These arrangements can be commercially sensible. They can also make the question of who actually suffers loss from infringement more complicated.

Take a common group structure. One company owns the registered trade mark, while another runs the UK business. If infringement causes lost sales, the immediate loss may therefore be suffered by the trading company rather than the registered proprietor.

Lifestyle shows why it is unsafe to assume that the proprietor will simply be able to recover that loss. The licensing and recordal arrangements between the two companies matter.

That makes recording trade mark licences more than an issue for businesses whose main activity is licensing brands to third parties. It can matter to an ordinary corporate group which has separated ownership of its IP from its trading operations.

And before recordal is considered, there must be an effective licence in the first place. Section 28(2) requires a trade mark licence to be in writing and signed by or on behalf of the grantor.

What does registration actually disclose?

One reason businesses sometimes hesitate to register licences is confidentiality.

There is a legitimate concern here. Commercial licensing arrangements may contain royalty rates, minimum sales obligations, termination provisions and other terms which the parties have no wish to put into the public domain.

Recording a licence at the UKIPO does not ordinarily require the commercial licence agreement itself to be filed. The register records prescribed information, including the identity of the licensee, whether the licence is exclusive, any limitation and, where applicable, its duration.

Where supporting documentation does have to be filed, separate rules govern public inspection and requests for confidentiality. So confidentiality remains relevant, but recordal does not automatically mean putting royalty rates and the other commercial terms of the licence onto the public register.

The register should tell the story of the business

Pull up the UK trade mark register for the principal marks and compare it with the business as it exists today.

• Is the registered proprietor still correct?
• If the marks have moved as part of an acquisition or group reorganisation, were the assignments recorded?
• If the IP sits in one company but another company operates the business, is there a licence and has it been recorded?
• Are important distributors, franchisees or other commercial partners operating under trade mark licences which have never been recorded?
• Have licences ended while the register still shows the former licensee?
• Are there sub-licences further down the chain?
• Has security been granted over the IP?

This is particularly worth doing after acquisitions. The trade mark register may show the right owner while saying nothing about licences and other interests created before the acquisition. Equally, transaction documents may transfer “all intellectual property” while the UKIPO register continues to show a former group company as proprietor.

Most of these issues are considerably easier to address when spotted promptly than during litigation or on the eve of a transaction.

Other jurisdictions have different rules on recording licences and other transactions, so an international portfolio needs to be checked country by country rather than assuming that the UK position applies elsewhere.

A relatively inexpensive precaution

The administrative burden and cost in addressing these issues are usually relatively modest.

Not every licence needs to be recorded as a matter of course. Large portfolios and complex licensing structures may call for a proportionate approach, and there can be commercial reasons to limit information placed on a public register. But the practical question is not simply whether registration is compulsory. It is whether the structure will still work as intended if the marks are infringed, sold, financed or otherwise put under pressure.

A licence which works perfectly well while nothing goes wrong may prove rather less useful when something does.

Time for a register check?

Lifestyle is an obvious reminder to consider recording trade mark licences. Its wider significance is that the register should be treated as part of the legal infrastructure of the business, not as a filing system revisited only at renewal time.

Trade mark portfolios tend to outlive corporate structures, management teams and commercial relationships. The registration obtained 10 years ago may still be perfectly valid while everything around it has changed.

An occasional comparison between the register and commercial reality is therefore worthwhile.

And if the two tell different stories, it is generally better to discover that before an infringer, investor or purchaser does.

This Insight piece was written by Tristan Morse.  If you have questions about trade marks or other forms of intellectual property, do please drop him a line.

All the thoughts and commentary that HLaw publishes on this website, including those set out above, are subject to the terms and conditions of use of this website.  None of the above constitutes legal advice and is not to be relied upon.  Much of the above will no doubt fall out of date and conflict with future law and practice one day.  None of the above should be relied upon.  Always seek your own independent professional advice.

Humphreys Law