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ACT FAST TO PROTECT YOUR BRAND ONLINE

by Simon Lord,
last updated 26/02/2015

in this article:

February 2015 - New domain name option leaves unwary franchises at risk of brand hijacking

One of the biggest advantages of franchising should be that the company has a known name and reputation that will help it to attract customers from the moment each new franchisee starts trading. Franchisors and franchisees spend a lot of money promoting and developing that name and reputation, so it’s important that they value it and protect it accordingly.

In the past, legally protecting a name, trademark or logo was fairly straightforward, but the development of electronic media has made it rather more complex: domain names, Facebook identities, Twitter accounts and all sorts of other developments mean controlling your brand is harder than ever.

As a business owner, one issue that you may face is how to protect your company from so-called ‘cyber-squatters’ – people who have bought similar domain names to your brand name in order to profit from your reputation. Cyber-squatters rarely trade under the domain name or contribute anything to the brand, but rather will attempt to sell such domain names back to the owners of the brand at hugely inflated prices.  This is a constant annoyance to brand-owners, as it can result in expensive, protracted and occasionally futile legal battles to gain ownership of these domain names. 

According to Scott Goodwin of franchise legal specialists Goodwin Turner, ‘Cyber-squatting is not necessarily always malicious; however, even if a third party registers a name similar to your brand in all innocence, it can create unnecessary confusion.  If you have been careful enough to register your brand as a trade mark you could potentially have an action in trade mark infringement or under the Fair Trading Act 1986. As already noted, though, this can be an expensive and lengthy process. The best approach is a preventative one, registering all possible combinations of your brand-name before someone else can.’

Now life is becoming even more complicated for brand owners in New Zealand with the launch of shorter domain names which have the suffix .nz as opposed to .co.nz or .org.nz. For example, if your franchise has the domain buttercup.co.nz then you may face confusion if someone else registers buttercup.nz as their domain name.

In order to try and avoid such issues, the Domain Name Commission launched a ‘Preferential eligibility’ process late last year that enabled organisations with a .co.nz or .org.nz domain name to register or reserve the shorter .nz version of their domain name before anyone else. ‘If you haven’t already done, this, though, you’ll need to move fast,’ Scott Goodwin points out. ‘Over 50,000 shorter domain names have already been registered but preferential eligibility expires at 1pm on 30 March 2015. After this date you will have to compete with the general public to register your brand under the new domain name.

‘To see if you have preferential eligibility, talk to your .nz provider or visit the Domain Name Commission’s anyname.nz site, which also explains how you can go about registering or reserving the new kinds of domain names.

‘If your website address is shared with another entity (for example, they own the .org.nz address while you own the .co.nz address), you can also lodge a preference for the new domain name on anyname.nz.  There’s no time limit for doing this, but our advice is to act as quickly as possible to secure your brand,’ Scott advises.

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