Trade marks: what to check before franchising in Argentina

A business may have loyal customers and a recognisable identity without yet being ready to authorise others to use its trade mark. Before adding members to your franchise network, you need to establish what rights you hold and how you will protect them. This review helps you avoid offering a brand identity that you may later have to change, or that you are not entitled to license.

1. Confirm who has the right to license the trade mark

In Argentina, franchise agreements are governed by Articles 1512 to 1524 of the National Civil and Commercial Code, enacted under Law 26,994 and in force since 1 August 2015. Franchising is therefore subject to specific regulation.

Article 1512 provides that the franchisor must either exclusively own the intellectual property rights, trade marks and other elements included in the system, or have the right to use them and grant those rights to the franchisee under the agreement. Simply using a trade mark at your premises does not, in itself, prove that you can license it as part of a franchise.

Trade mark protection is governed by Law 22,362 on Trade Marks and Trade Names. The body responsible for registering trade marks is the National Institute of Industrial Property, known as INPI. Ownership of a trade mark and the exclusive right to use it are obtained through registration.

Check who is listed as the owner. It is common for the founder to own the trade mark while the business operates through a company. This does not necessarily prevent franchising, but it does mean that the chain of authorisations must be put in order. If the company is to act as franchisor, it must hold sufficient rights to allow its franchisees to use the mark.

Practical check: gather the registration certificate, the owner's details and any assignments or licences. Seek a professional review if there are joint owners, previous companies or unclear authorisations.

2. Check what the registration actually protects

Do not confuse company registration, an internet domain name or a social media username with trade mark registration. These are separate assets, and none automatically replaces the others.

Your review should compare the legal protection in place with the business you intend to replicate. Prepare an inventory covering:

• The trading name used with the public.
• The logo and any versions used on signage and packaging.
• The products and services each franchise will offer.
• Any additional trade marks used for own-brand product lines.
• Domain names and digital accounts linked to the operation.

Trade marks are registered for specific goods or services, grouped into classes. Holding a registration does not mean that the name is protected for every type of business activity. Nor should you assume that registering a logo provides the same protection for all its individual components.

Have the scope of protection reviewed against the specific franchise format you plan to offer. For example, a trade mark associated with food products may need further analysis if the concept also includes café services.

Also check the status of each application or registration: a pending application is not the same as a granted registration. Review any oppositions, examination objections, expiry dates and maintenance requirements. Registration lasts for ten years and can be renewed subject to the legal requirements; it should not be treated as an asset that can be filed away and forgotten.

3. Reflect those rights in the franchise agreement

Once ownership and the relevant permissions are in order, the agreement must explain what use is authorised. Avoid generic wording that fails to identify the trade marks covered or the limits of the authorisation.

Work with a legal adviser on the following points:

• Identification: the authorised trade marks, registrations and visual elements.
• Scope: the products, services, premises and channels for which they may be used.
• Duration: how the permission to use the marks relates to the term of the agreement.
• Changes: the procedure for approving new uses or changes to the brand's visual identity.
• Termination: removal of signage and cessation of use on digital profiles, packaging and advertising.

The commercial territory agreed with a franchisee and the scope of trade mark protection are different matters. The agreement must align them without promising exclusivity that the available rights cannot support.

If the franchisor uses someone else's trade mark under licence, pay particular attention to the licence term, the right to authorise use by third parties and the consequences of termination. Do not base long-term commitments on an insecure permission.

4. Organise protection before attracting prospective franchisees

Assign someone responsibility for tracking trade mark deadlines and maintaining the records. Also establish how unauthorised use, imitations and third-party claims will be reported. Article 1514 of the Code sets out obligations for the franchisor concerning the defence and protection of these rights; the response should not be improvised after a franchise has opened.

Before advertising the franchise opportunity, prepare a file containing registration certificates, pending applications, authorisations and a list of unresolved risks. Your marketing materials must reflect the actual position, without describing a trade mark as registered while its application is still pending.

Practical takeaway: before offering your first franchise, confirm ownership, the scope of protection and your authority to permit use. If any of these three points is unclear, resolve it before making commitments involving your franchise network's brand identity.