With the advent of the Internet, everything around the world is just a click away. From getting the best deals on snapdeal.com to ordering your favourite book from flipkart.com, the internet has a lot to offer for buyers around the world. E-commerce is exploding as the next big thing in the cyber space. As per a recent report by IMAI, the market size of e-commerce in India is expected to grow to about ` 46,520 Crore in 2011 from ` 31,598 Crore in 2010, which is a staggering growth of 400% growth in the last 5 years. This enormous growth is fostering competition. More and more entrepreneurs are venturing into e-commerce business. Online portals are now selling goods of almost all kinds and necessities. In this competition, finding USPs that differentiate one e-commerce business from the other has become imperative.
Though pricing of the goods or services and service quality still remain the mantra for success of an e-commerce business, few secondary factors also play a pivotal role. One such factor is the name under which the e-commerce business operates, i.e., its domain name. As you many of us know domain names are a human friendly form of internet addresses and are used to find web sites on the internet. For an e-commerce business having the right domain name is paramount for achieving ultimate success. Usually, e-commerce businesses endeavor to find a domain name that is trendy, catchy and easy to remember for the online users. Online companies spend a lot of efforts researching a suitable domain name, and most of the times, land up coining a unique one. In the history of Internet, domain names such as ebay.com, makemytrip.com, naukri.com, amazon.com, shaadi.com, quickr.com, zomato.com, and the like, have proved to be very successful for their owners.
However, as it always goes, great success always attracts the threats from exploiters. Most of the exploitation of domain names arises from the practice of cyber squatting, which involves the pre-emptive registration/usage of trade names as domain names by third parties. Cyber squatters exploit the first-come first-serve nature of the domain name registration system to register or use same or similar trade names of businesses. Cyber squatters also usually register or use names of famous people or businesses as domain names. Usually, these cyber squatters do not have any relationship with these businesses or people, and solely register or use the domain name with the intention of fleecing money from their fair proprietors or leverage the brand value of the business. Therefore, the pertinent question is that how can e-commerce businesses ensure the sanctity of their domain names and protect them from exploitation?
It is apparent from discussions above that a domain name accrues the characteristics of a trade name over a period of time. In e-commerce businesses this phenomena is much more common, where one company owns many portals, and the identity and the image of the company is associated with the domain name of their portals. For example, Info Edge (India) Ltd., a major in the online space, owns multiple portals, such as Naukri.com, Shiksha.com, 99acres.com, Jeevansathi.com, and the like. So the pertinent question that arises is that can somehow domain name get the benefit under Trademark laws and can be registered as distinct trademarks there-under? If yes, can the protection offered under the Trademark laws be extended to domain names, and can unauthorized use of domain names, which are deceptively similar to your domain name, be considered as violation of any such registered trademark?
This question was discussed in a landmark case, Satyam Infoway Ltd. vs Sifynet Solutions Pvt. Ltd. In this case, Sifynet Solutions, an Ahmedabad based company registered several domain names, such as http://www.sify.net, http://www.sifymall.com, and http://www.sifyrealestate.com, with Internet Corporation Assigned Names and Number (ICANN). In opposition to this, it was opined by Satyam that the word ‘Sify’ is a coined word and has been used using its corporate name. Also it was averred by Satyam that the word has claimed a wide reputation and goodwill.
The Supreme Court in this case held that the original role of a domain name was to provide an address for computers on the internet. Further, the Supreme Court noted that with the increase of commercial activity on the internet, a domain name is actually been used as a business identifier, and therefore, acts as a trademark. On the question of whether the principles of trademark law and in particular those relating to passing off apply to domain name and infringement (in case the domain name is registered), the court held in affirmative. The court believed that it is an action not only to preserve the reputation of the plaintiff but also to safeguard the public.
Therefore, the logical conclusion derived is that the domain names can be registered as trademarks, and in this way you can certainly add trademark registered domain names in to your Intellectual Property (IP) assets. Benefits of registration of domain name as trademark stem from the concept that if somebody uses a domain name deceptively similar to your trademark registered domain name, a remedy in the form of trademark infringement action, which is swifter and well defined as compared to existing domain name exploitation redressal mechanisms, can be brought against the alleged violator. However, it should be understood that the rights vested with an owner of a trademark by registration thereof are limited in the geographies where the trademarks are registered. Therefore, in context of the above discussion, the aforementioned remedies can only be availed only in the courts of India.
In light of the aforementioned decision of the Supreme Court, the Trademark Registrar, the administrative body overlooking registration of trademarks in this country, has been allowing trademark registration for domain names. We have fetched the following examples for ready references:
- The Reliance owned, www.bigflix.com, has been provided a trademark registration domain name.
- www.flipkart.com, which is owned by Flipkart Online Services (P) Ltd., has also been provided a trademark registration to the domain name.
- Likewise is the case with Info edge (India) Ltd., which owns www.99acres.com and www.naukri.com .
Finally, for the entrepreneurs who would be interested in obtaining a trademark on their domain name, the procedure for Trademark registration in India is elucidated in brief with the help of the following flowchart.
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[Guest article by Kshitij Malhotra, Founder & Director, Inohelp IP. He can be contacted at kshitij.malhotra@inohelp.com]
