Lisa Desjardins, host (Lisa): You're listening to Canadian IP Voices, a podcast where we talk intellectual property with a range of professionals and stakeholders across Canada and abroad. Whether you are an entrepreneur, artist, inventor, or just curious, you will learn about some of the real problems and get real solutions for how trademarks, patents, copyrights, industrial designs, and trade secrets work in real life. I'm Lisa Desjardins, and I'm your host.
The views and opinions expressed in this podcast are those of the individual podcasters, and do not necessarily reflect the official policy or position of the Canadian Intellectual Property Office.
Lisa:
In today's episode, we'll hear from Martin Lacelle at Corporations Canada, where Canadian enterprises incorporate their businesses. We'll also hear from James Plotkin who is a litigation and disputes lawyer in the law firm Gowlings and works in the Ottawa office, practicing in the advocacy and intellectual property groups and is an expert in the laws around trademarks and domain names.
So Martin, I'll start with you. Could you tell me, what does Corporations Canada do?
Martin:
Hi, Lisa. Well, first of all, I want to say it's a real pleasure to be here with you today and I'm really happy that we can clarify some of that information for our listeners. Corporations Canada is the federal corporate regulator. It administers the laws that allow Canadians to create and maintain a corporation under the federal laws governing corporations in Canada. In other words, if you incorporate at the federal level in Canada, you will do it through us.
Lisa:
So you say federal level, but is it also possible to incorporate with the province or a territory?
Martin:
Absolutely. In Canada, there are a total of 14 jurisdictions under which you can incorporate. This means that you can incorporate into 10 provinces, our 3 territories and, with us at Corporations Canada at the federal level. Now it's important to note, however, that you can only incorporate in one jurisdiction at a time. In other words, you cannot have the same corporation incorporated in multiple jurisdictions. For today's discussion, we will focus on the federal incorporation.
Lisa:
Thanks for clarifying that. That's a good lay of the land. Before we continue, can you tell us a little bit about yourself?
Martin:
Absolutely, of course. I actually started to work with Corporations Canada over 2 years ago. I started working as an information and services officer. So in other words, I was one of the people who would answer calls in our contact centre and that really gave me the opportunity to get a firm grasp on the incorporation process. Now that includes, of course, how to apply for a corporate name. Through my career I've worked a lot in the training and facilitation field. And this is why, today, I work as a project officer. So my main responsibilities are to train new people who join our team and to develop training material.
Lisa:
I'm so happy that you've got the training because this is what we're trying to do here. We're trying to learn and educate. You're the perfect match for this interview.
Martin: [laughing] Thank you.
Lisa: So, I've wanted to ask you. We're talking about names today and we're going to start with company name. What does the company name mean? And why is that important?
Martin:
Well, when you decide to federally incorporate your business, your business then becomes a corporation and it will need a distinct corporate name. That corporate name is your company's legal name. This means that you will have to use it, for example, in your contracts and invoices. Now, there are 2 ways to name your corporation. You can have a word name, or you can have a numbered name. You can get a word name and once it's approved, you have the right to use it across Canada and, of course, this will make it easier for your customers to recognize you, wherever you do business.
Lisa:
I've seen on the Corporations Canada website that the corporate name has to be distinctive, and you mentioned that several times now. Can you explain what that actually means?
Martin:
Absolutely, because the idea of distinctiveness is an essential part of your corporate name. It means that the name should distinguish you or, I should say, should distinguish your corporation from any other business. And choosing a corporate name that is distinctive will greatly increase the chances that our examiners will be able to approve it.
So I will use myself as an example. I'm a musician. I like to play music in my personal time. So let's pretend that I'm going to open a store and I'm going to sell guitars. I could call it "Martin's Guitar Shop, Inc." In this case, my name as a whole is distinctive because I am using my first name, "Martin," making it distinctive. Just using "Guitar Shop, Inc." would not be distinctive as it merely describes the type of products or services that I would offer, and that would not distinguish me from other businesses that are actually in the same field. Now, what if just around the corner there's another music store that is called "Martin's Guitar Store, Inc." Now, this may become confusing for potential customers because it could be easy for them to confuse both businesses, obviously because the name sounds so similar.
Now, that brings me to another example where you can simply use a regular word from the dictionary in a more creative way. Maybe, I don't know, let's say, "Monkey's Guitar Shop, Inc." Now, it is another way to come up with a name that is distinctive.
Another way to make your name distinctive is to make up a word that doesn't actually exist.
And an easy way to do that is simply to combine some words together. So, Lisa, let's pretend that you're actually going to start this business with me. Maybe what we can do, in this case, is simply combining our 2 first names together to make up a new word. Our store could be called "Lismar Guitar Shop, Inc." Again, we have created a name that is distinctive. The idea is to make sure that your corporate name is not confused with the name of another business.
Lisa:
That's a fun and easy way to come up with something that's distinctive, but you also mentioned numbered names. Tell us a little bit more about that. What's that about?
Martin:
Well, even though a lot of people who incorporate will choose to have a word name, it is not absolutely necessary to do so. The other option is to choose a numbered name and to be honest, this is the easiest way to incorporate because Corporations Canada will simply assign a number. For example, it could just be called "12345678 Canada, Inc."
Lisa:
[laughing] Yeah, but it would be kind of weird to walk down the street or say browse the web and did see a business that's called "1234568 Canada, Inc."?
Martin:
Yeah, indeed! I think we can all agree that putting "12345678 Canada, Inc." or having someone saying: "Hey guys, I just bought this new guitar at 12345678," right is absolutely not appealing to the potential customers or anyone who passes in front of your store. This is why a lot of business owners will have a numbered name for their corporation name, but they will also register what we call a trade name or operating name and they are going to do that with their province or their territory. That trade name is what you would see on the storefront and how most people would recognize you or would refer to you. For example, this means that when they deal with a bank, write checks or invoices, they would use the name "12345678 Canada, Inc." but for most people they would be known as "Lismar Guitar Shop" and, of course, this is also the name that would appear on the storefront. Again, I just really need to emphasize that if you do choose that option, you will incorporate federally with Corporations Canada, but your trade name or operating name, that is something that you would register with your province or your territory.
Lisa:
So we're getting into an interesting difference here. We're talking about using one name for operating and the other one is kind of what the consumers would see and then we're getting a little bit closer to the trademark. So, what we have here for the "Lismar Guitar Shop," if I wanted to use that, that's the same as a trademark, isn't it?
Martin:
No, actually it's quite different, Lisa. So a lot of people will confuse corporate names and trade names with trademarks. Now we have to understand that these are completely different types of names that are governed by different laws, and the application processes are also very different. As we have already mentioned, if you incorporate a business or a not-for-profit corporation, you propose a word name when you incorporate online. Now, if you decide to have a numbered corporate name, but want to use a different name on your storefront, for example, then you will apply for that trade name and that will be done with your province or your territory. Finally, to apply for a trademark, you will need to get in touch with the Canadian Intellectual Property Office.
Lisa:
Yes, as we can hear, Martin has talked about the importance about having a distinctive corporate name and how these legal names are the ones we'll use on contracts and invoices. But a corporation can have several brands and products and here we're starting to talk about trademarks.
James, your practice focuses on commercial litigation and arbitration, intellectual property litigation and administrative law. I know you're also involved in domain name dispute resolution, both as a counsel and adjudicator. James, could you tell me a little bit about yourself and the kind of work that you do?
James:
Sure, and thanks a lot for inviting me onto the podcast, Lisa. So as you said, my practice focuses on commercial litigation as well as arbitration, both international and domestic and I also do a fair bit of intellectual property litigation, which is pretty germane to what we're talking about today: trademarks. I also practice in the area of administrative law and with respect to domain names, there's a specialized dispute resolution process that applies to domain name disputes and I work in that space both as a counsel and as you said as an adjudicator as a domain name dispute panelist.
Lisa:
Oh, that's perfect. We'll talk about that in a moment, but we'll start talking about trademarks. How do you define trademarks and why are they important?
James:
To add base trademarks are words, symbols or other indicators, like colour or smell, that identify goods and services in the marketplace with their source.
Trademarks are a vital asset to Canadian companies. It aids both consumers and businesses in indicating the origin of goods and services. Trademarks perform this key function by providing consumers with what you might call a shortcut to get them to where they want to go in the marketplace. In other words, trademarks are designed to create a mental linkage. Think of the Nike Swoosh on shoes or the Apple logo on computers. These trademarks are iconic and immediately identify the source of those goods and services.
Now, trademarks allow consumers to make informed choices about the goods or services that they're purchasing. From the businesses perspective, trademarks are key to building brand recognition and reputation in the marketplace. Indeed, for some businesses Lisa, trademarks are actually their most valuable assets.
Trademark rights in Canada arise through use. It's possible to protect an unregistered trademark. However, it is ideal to register trademarks as this confers a host of significant advantages and these include protection across the country, rather than a specified limited geographical area within Canada, better enforcement options, public notice for parties trying to clear their own trademark rights and the ability to block the registration of confusingly similar marks at the Canadian Intellectual Property Office. So it really is always better to register your trademarks whenever you can.
Lisa:
Yeah, we talk about the distinctiveness and confusingly similar marks. So, if we go back to Martin's example of "Lismar Guitar Shop" and the distinctive word "Lismar" and how the value of both of these can build over time. What would be the best term to protect as a trademark?
James:
That's an interesting question. So, the best trademarks, in my opinion, are ones that most readily create the connection in the consumers mind between the goods and services and the company that sells them. This is generally the work of marketing departments and graphic designers who have expertise in using names and logos to grab people's attention.
Now, from a legal perspective, the more distinctive, that is to say unique a trademark is, the more likely it is to receive a registration. On one end of the spectrum, you have coined terms. These are words with no dictionary meaning or made-up words. Again, Nike comes to mind as an example here. Since the word Nike does not describe any particular person, place, or thing, it's readily usable as a trademark.
On the other end of the spectrum, you have clearly descriptive terms. For example, guitar shop. Now, in general, a clearly descriptive term will not be registered unless the applicant can show a great deal of acquired distinctiveness. That is, reputation acquired through extensive use and established recognition in the marketplace. In between coined terms and clearly descriptive ones, you have a vast spectrum of terms that are suggestive of certain goods or services, but not clearly descriptive of them.
One example might be "Lawn Magic" for a landscaping company, or "Six Strings and Three Chords" for a guitar shop. These marks are made-up of ordinary dictionary words, and although they suggest the goods or services with which they're associated, they don't clearly describe them.
Lisa:
One of the questions that we often get relates to domain names and I wonder if we could talk a little bit about websites and domain names and how they can be linked with trademarks in case of a dispute. So let's say I open "Lismar Guitar Shop" and then I register the domain "lismar.com." Is that a protection I can rely on if let's say someone else uses "Lismar" for another product?
James:
Well, the answer is somewhat nuanced Lisa, but the short answer is not quite. A domain name is a unique identifier that allows Internet users to access various digital locations, including websites. If your website is your digital storefront, then you can think of your domain name as your signage. Now, domain names do not, in and of themselves, confer legal rights. They're not a substitute for a registered trademark or trade name. However, given the amount of business that we transact online these days, domain names sometimes act like identifiers in a similar way to trademarks.
So, if your domain name corresponds with your trademark, it could be an important part of how you build your reputation, or, as lawyers say, goodwill in the market. Goodwill, in turn can assist in enforcing trademark rights, in particular when your trademark is unregistered. Likewise, if your mark is more on the descriptive side, proof of reputation built through using the mark in a domain name might assist an applicant in convincing the Canadian Intellectual Property Office that there's sufficient acquired distinctiveness to allow registration where otherwise the office might reject it.
Lisa:
So, let's say we start by registering a number corporation with Corporations Canada, but we trade as "Lismar Guitar Shop." And let's then say that the shop does really well and we realize that we want to protect the "Lismar" name as a trademark and a domain name before anyone else does. Are there any lessons here that you can share with someone considering starting a company? In what order should we do this?
James:
Well, the order is, I think, really dictated by the priorities of the business, but I'll speak first of the trademarks and then to the domain names.
For trademarks, the first thing to do, in all cases, is to ensure clearance, and this entails making sure that the trademark that you want to register, or one very similar to it, is not already being used by someone else in association with similar goods or services. This is critically important since CIPO might refuse a registration on this basis. For domain names, the process is a lot simpler. All you need to do is navigate to a domain name registrar and search the desired domain name. The registrar site will tell you whether it's available and what the annual registration fee for the domain name will be, and I think we'll be talking a little bit more about that later.
Lisa:
Yeah, let's go to practice here. Obviously, we need to do some searching and make sure that these names are available before we embark on naming our business, so let's go to practice. Martin, how do you apply to get a corporate name?
Martin:
Well, actually, when you incorporate your business you will be given a choice between a word name or a numbered name, and this can be done really easily online through Corporations Canada's online filing centre.
Lisa:
Okay and I know that there is a search report that I think is called NUANS. What is that exactly and when is it needed?
Martin:
NUANS is the Government of Canada's combined search tool of business names and trademarks. So, what this tool does is that it uses a powerful algorithm to list names and trademarks similar or identical to the name that you're looking for. When you decide to incorporate online through Corporations Canada's online filing centre, the name search is actually already integrated. You simply select custom incorporation and then you indicate that you want a word name and from there you just follow the instructions.
Lisa:
That's great. Any other hints to entrepreneurs?
Martin:
Absolutely. I would say remember that our website is a great source of information about corporate names, about how to incorporate, and about what you need to do to maintain your corporation in good shape once you've already incorporated.
And if you need more information, I always, always recommend to start with our website. It's Canada.ca/federal-incorporation. One more time: Canada.ca/federal-incorporation.
Now, if you still have questions, you can get in touch with us by sending us an e-mail at ic.corporationscanada.ic@ised-isde.gc.ca and, of course, you can always call us at 1-866-333-5556.
Lisa:
Thank you, Martin. We'll publish those contact details in the description of this podcast. Now, if we're talking about trademarks, who and how can a person or a corporation register a trademark? James?
James:
Trademark registrations are issued by the Canadian Intellectual Property Office, which oversees the Canadian Trademark Registry. A person can file a trademark application online. Now, while it's possible to do so without advice, it's usually best to engage the services of a trademark agent. A trademark agent can help ensure that the application reflects the applicants branding strategy and help avoid common pitfalls in the registration process.
Once the application is filed, it's reviewed by a trademark examiner to ensure compliance with the Trademarks Act. Should any issues arise, the applicant receives an office action from the examiner, which will require a response. Again, a trademark agent can help deal with these issues. Once all issues are resolved, the application will be advertised. At this stage, third parties can oppose the application and object to the registration on the basis that it's identical or confusingly similar to their own trademarks, and on a few other grounds. This is a quasi-judicial proceeding involving pleadings, evidence, written submissions, and sometimes oral hearings as well. Once the application is through the opposition period, it will proceed to registration.
Lisa:
Thank you. And what's the most common way for people to register a domain name?
James:
Well, to register a domain name, let's talk lingo for a minute. A person who registers a domain name is called a "registrant." All domain names are divided into different "top-level domains" or "TLDs." Familiar ones that we all know are ".com," ".ca" and ".net." Each of these is governed by a "registry." For example, the registry for ".ca" is the Canadian Internet Registration Authority or CIRA. They are the masters of the ".ca" domain. Registries internal our registrars to deal directly with registrants, the people who want to register their domain names. There are many registrars, for example GoDaddy and Tucows. These are well-known registrars, but there are many of them.
When you want to register a domain name, you can navigate to a registrar's website and see if your preferred domain name is available. If so, you register it by paying the registration fee, which will vary from domain name to domain name, and generally registrations must be renewed annually and there is a renewal fee that will be charged by the registrar each time.
Lisa:
What's your advice to someone who is about to set the name for their company? Where should they start?
James:
As I mentioned before Lisa, careful planning and clearance from the outset will avoid serious headaches down the line. With the assistance of a trademark agent, business owners can navigate these important pre-registration steps to assure smooth sailing in the registration process and beyond.
Lisa:
Martin and James, thank you so much for sharing your time and expertise to explain how it works with corporations, trade names, domain names and trademarks. It's been fantastic to have you here. On behalf of many entrepreneurs across our country, thank you so much for participating in today's podcast.
Martin:
Thank you very much for having us. It was a pleasure.
James:
Thanks a lot, Lisa. I appreciate it.
Lisa:
You've listened to Canadian IP Voices where we talk intellectual property. In this episode we've taken a closer look at the different names that are important to companies. We've heard from Martin Lacelle at Corporations Canada, which is where you incorporate your company at a federal level either as a word name or a numbered name. This is your firm's legal name. Martin also explained that you can incorporate in a specific province or territory. We've also heard from James Plotkin at law firm Gowlings. James explained the ways to secure exclusive rights to the names we see as consumers: trademarks and domain names. For all of these names, it is important to give some thought into what you will call your business. Consider a distinctive, unique and non-descriptive name and remember, different authorities administer these names.
Federally, you incorporate with Corporations Canada. At a provincial and territorial level, contact the local authorities. The Canadian Intellectual property office deals with trademarks and for domain names, you'll contact a registrar. To lean more, open the description to this episode for links to more resources.