Saudi laws governing trademarks
In the previous article, we highlighted the basic rules governing the use of trademarks in Saudi Arabia. Today’s article will deal with violations, penalties and other scenarios such as transfers of ownership and mortgages.
The ownership of a trademark may be transferred to others by following certain procedures. The transfer agreement should be in writing and must not mislead the public, especially with regard to the nature and source of products or services.
It should be noted that the ownership of a commercial entity or project can be transferred without the ownership of the trademark. Whoever remains the owner of that trademark reserves the right to continue using it for products or services it was registered to deal with, unless otherwise agreed upon.
In addition, the trademark may be mortgaged or seized with or without the business or commercial entity. However, they must announce that the ownership of the trademark has been transferred, mortgaged or seized and should be registered at the trademarks registry in order to be effective against others.
Violation of trademarks law carries penalties such as imprisonment for a period not exceeding one year and a fine of no less than SR50,000 ($13,331) and not exceeding SR1 million.
The offenses that result in either of these penalties include identity theft and identity fraud.
Furthermore, there is another penalty of imprisonment for a period not exceeding 3 months and a fine of no less than SR20,000, and not exceeding SR250,000, or one of these two penalties on whoever uses unregistered trademarks that contain expressions, drawings or signs that violate public morals, use public emblems, flags or military and honorary emblems, such as symbols of the Red Crescent or the Red Cross.
In addition, the penalty will be imposed on those who use any trademarks that have a statement that leads to the belief they are registered.
In the event of the violation being repeated, the law stipulates a penalty not exceeding twice the maximum penalty prescribed for the violation, with the closure of the business or the project for a period of no less than 15 days and not exceeding six months, with the judgment being published at the expense of the violator.
It is worth noting that the penalty for repetition is issued against everyone who was convicted of one of the offenses stipulated in the law who commit a similar offense within three years from the date of the final ruling for the previous violation.
• Dimah Talal Alsharif is a Saudi legal counsel and a member of the International Association of Lawyers. Twitter: @dimah_alsharif