Brand Capital · The Law of the Label · Two
Who Owns the Name on the Product?
Four claimants, four registers, and the difference between the strongest case and the strongest position.
The founder who built the name has the best moral claim to it and frequently the worst evidence. In a registration system, those are not the same thing, and the gap between them is where Nigerian brands are lost.
Paul Magaji · 17 min
Six years after her first order, a founder decides to do things properly. Her accountant has mentioned that the trademark should really be registered, and she agrees, and she instructs an agent, and the agent conducts a search.
The name is already on the register. It was filed in the third year of the relationship by the factory that makes her product, in the class that covers her goods, and it has since proceeded to registration unopposed, because nobody was watching the journal and nobody had told her there was a journal to watch.
She has the customers. She has the invoices. She has six years of Instagram, a distributor network in four states, and a name that means something to the people who buy it. The factory has a certificate.
Registration is a race.
She had not known that she was running.
This is the most consequential essay in this sub-cluster, because ownership of the name is the question every other question depends on. Who bears the liability, who may license, what passes on death, what a buyer is buying, whether there is anything to sell at all — each turns on an answer that most founders assume rather than establish.
Act One
Four registers, and only one of them is ownership
Before asking who owns the name, it is necessary to notice that the name exists in four different places, and that Nigerian founders routinely mistake one for another.
Corporate Affairs Commission
Company or business name. Establishes that an entity exists and may trade under a name. It is a corporate registration, not a property right in the words. It does not stop another business in another sector — or often the same one — from using something very similar, and it confers no monopoly a court will enforce as such.
Trade Marks Registry
Trademark. The only one of the four that is ownership of the name as a commercial asset. It confers an exclusive right in specified classes of goods or services, renewable indefinitely, assignable, licensable, and enforceable against infringers without proving reputation.
Domain registrar
Domain name. A contractual licence to use an address for a period, renewable. It is not property in the name and it does not survive the lapse of a payment card.
The platforms
Handles and pages. Governed by terms of service written elsewhere and administered by processes indifferent to Nigerian company law. Recoverable sometimes, on the platform's terms, and never quickly.
A founder who has registered a business name at the Commission and secured a matching domain has done two useful administrative things and has not acquired the name. This is not a technicality. It is the single most common and most expensive misunderstanding in Nigerian commercial identity, and it is sustained by the fact that the Commission’s certificate looks exactly as official as the one that would have mattered.
Act Two
The four claimants
When ownership of a private-label name is contested, four parties may credibly appear. Their claims are of very different kinds, and the strength of a claim in argument is a poor guide to its strength in practice.
Claimant One
The commissioning seller
The best moral claim and, unregistered, the most expensive one to enforce.
She chose the name, paid for the design, built the demand and carried the risk. If she has registered, the argument ends here and everything below is academic — a registered proprietor enforces her right by producing a certificate.
If she has not registered, she is not without remedy. The law of passing off protects an unregistered reputation, and a trader who has genuinely built goodwill in a name may restrain another from misrepresenting a connection with it. But passing off is proved, not produced. It requires evidence of reputation, evidence of misrepresentation and evidence of damage, assembled and tested, at a cost and over a timescale that a registered proprietor never has to contemplate.
The proof
Dated evidence of first use and continuous use: invoices, packaging artwork with dates, advertising spend, distributor agreements, press coverage. Assembled contemporaneously it is powerful. Assembled after a demand letter arrives it is expensive and thin.
Claimant Two
The manufacturer
Often the weakest claim in principle and the strongest on the register.
A factory may claim the name for one of two reasons. Either the name was genuinely the factory’s line, offered to the seller along with the product, in which case its claim is real and the seller has been building on borrowed ground. Or the factory simply registered a name it saw its customer using, which is a different matter entirely.
The second case is not hopeless for the seller. A registration system does not exist to reward applicants who had no genuine claim to proprietorship, and there are grounds on which an entry obtained in those circumstances may be challenged. But challenging an entry is slower, costlier and less certain than making one, and while the challenge runs the certificate is in someone else’s hands. The asymmetry is the point: filing is cheap and displacing is not.
The proof
Whether the name appeared in the factory’s catalogue or correspondence before the seller used it. First written use is decisive here, and it usually sits in an email thread nobody thought to keep.
Claimant Three
The designer
No claim to the name. A real claim to the thing the name is written in.
A designer does not own a word. But a logo is an artistic work, and Nigerian copyright vests in the author at the moment of creation. Commissioning does not transfer it and payment does not transfer it. Only an assignment does, in writing and signed.
In practice this rarely produces litigation and frequently produces leverage. It appears when a business is being sold and the buyer’s lawyer asks for the chain of title in the artwork; when a founder wants to modify a mark and finds she has no right to make derivative works of it; or when a designer, having watched a small client become a large one, forms a view about what the original fee bought.
The proof
A signed assignment naming the works and the date. An invoice describing the payment as being for assignment of all rights helps and does not replace it. Editable source files are practical leverage and not a legal right.
Claimant Four
The stranger who filed first
No connection to the business, and possibly the only certificate in the room.
This is the competitor with better advice, the former distributor who saw the trajectory, or the applicant who files marks speculatively and waits for someone to need one back. The claim has no commercial substance and, unchallenged, has full legal effect.
The strategy works because it exploits the same asymmetry: the cost of filing is trivial against the cost of the business it can obstruct. It is defeated in exactly one way, which is by having filed earlier.
The proof
None is required of the stranger. That is the entire difficulty, and the reason this essay’s practical advice reduces to a single instruction.
The register does not ask who deserves the name. It asks who arrived.
Act Three
What survives the certificate
It would be wrong to leave the impression that the register is the last word. It is not. It is merely the cheapest word, and the first.
An application does not proceed to registration in secret. It is examined, and if accepted it is published, and there is a window during which anyone may oppose it. A business that watches the journal — or instructs someone to watch it — can stop a wrongful application before it becomes a wrongful registration, at a fraction of what it costs afterwards. Almost no Nigerian business does this, which is why the founder in the opening scene was not told.
After registration, an entry may still be challenged. Registers are not sealed. An entry wrongly made, or made by an applicant with no genuine claim to proprietorship, or one that has ceased to be used, is vulnerable. Prior reputation is relevant and is not extinguished by someone else’s filing.
But everything in the preceding two paragraphs is a proceeding. Proceedings take years and money and produce uncertainty in the interval, and during that interval a business may be unable to expand, unable to sell, unable to satisfy a lender, and unable to answer the buyer’s question. The founder with the certificate is negotiating. The founder without it is litigating. Both may end in the same place. They do not cost the same to reach it.
Act Four
Whose name is on the certificate
Suppose the founder does register, in time, correctly. One question remains, and it is quietly the most important in the essay: in whose name?
The agent asks, and the founder gives her own, because it is her name and her business and the distinction has never been explained. The mark is then her personal property, used by a company she owns, usually without any licence recording the permission.
Three consequences follow. The company’s accounts show a business trading on an asset it does not own, which a buyer’s adviser will notice and price. The mark forms part of her personal estate rather than the company’s assets, so on her death it passes under succession law to heirs who may not be the people running the business — the fourth death the series pillar describes. And the use of the mark by the company, being unlicensed and unsupervised, weakens rather than strengthens it, for reasons the essay on quality control in this sub-cluster takes up.
The alternative is not obviously better in every case. A mark held by the operating company is exposed to that company’s creditors and its commercial risks; if the trading business fails, the name may be sold by a liquidator to a stranger. This is why brands of any size end up held by a separate entity that owns the intellectual property and licenses it to whoever trades, which is a structure with real costs and real reasons, and which the last essay in this sub-cluster is devoted to.
The point here is narrower and prior to all of that. The question is not merely whether to register. It is whose name goes on the certificate, and that question deserves five minutes of deliberate thought at a moment when it costs nothing to answer well.
Act Five
The folder
When a buyer, a lender, an heir or an opponent asks what a founder owns, the answer is a folder. Its contents are unglamorous and can be assembled in an afternoon at almost any stage of a business, and their absence is what turned the opening scene into a loss.
The registration certificate, with the classes it covers, and a note of the renewal date. A record of the search that preceded the application, which establishes that the applicant looked. The assignment of copyright in the logo and packaging artwork, signed, naming the works. The original artwork files. Dated evidence of first use — the earliest invoice, the earliest packaging, the earliest advertisement. The manufacturing agreement, with the clause restraining the factory from registering or using the mark. Any licence permitting a company or a related entity to use the mark, with its quality-control terms. The domain registration, in the company’s account rather than a developer’s. Written confirmation of control over the social accounts.
Nine items. A founder who holds them can answer the question in the opening essay of this series in about ninety seconds. A founder who does not will spend a due-diligence period constructing them under time pressure, at valuation, with the other side watching.
The folder is also the reason to do this early rather than well. An imperfect registration held from year one is worth more than a perfect strategy adopted in year six, because the asset in question is a queue position.
Act Six
Three decisions, before the first order
Everything above reduces to three decisions, each cheap, each taken before production begins or not taken at all.
Search and file, in the correct classes, before the name is public. The application is inexpensive relative to any other cost in launching a product, and it converts a moral claim into a legal position. Classification is where this goes wrong more often than anywhere else, and it is the subject of a later essay in this sub-cluster; the principle is that the registration should cover what the business sells and what it credibly intends to sell next.
Assign the artwork in writing, at the moment of payment. A designer asked for an assignment while being paid will sign one. A designer asked four years later, when the business is visibly successful, is being asked a different question.
Restrain the factory, in the agreement, from registering or using the mark. One clause. It is refused only by a manufacturer who had been considering the possibility, which makes the request diagnostic as well as protective.
The founder in the opening scene did none of these, not because she was careless but because nobody told her they were available. She was building a business, and the three decisions look like paperwork until the day they turn out to have been the business.
A name you have used for ten years and never registered is a name you have been holding for whoever registers it next.
This publication is educational and analytical. It describes how legal and commercial structures work; it does not advise on any particular matter, and nothing here should be relied upon as advice on a reader’s own affairs. The author holds commercial interests in the brand-building and private-label sector examined by this series.