Trade marks are valuable intellectual property rights and can be exploited in various different ways. One way to extract value from a business is to sell a trade mark, either as part of a wider sale of the business or through sale of the trade mark alone. In this article, our trade mark team look at the process involved in transferring a trade mark from one owner or another and the important points to consider before, during and after the sale.
If you’re reading this because you’re thinking about selling a registered trade mark, our trade mark solicitors can help. We’ll explain how the sale process works, what legal documents you’ll need, and how to manage the transfer with the UK Intellectual Property Office
Contents:
- Can I sell my trade mark?
- Why might I want to sell my trade mark?
- How do I value my trade mark?
- Do I need a lawyer to sell a trade mark?
- Can I sell a trade mark to a buyer based outside the UK?
- Can I sell a trade mark if I have licensed it to someone else?
- How do I sell a trade mark?
- What are the costs involved in selling a trade mark in the UK?
- How long does it take to sell a trade mark?
- What are the alternatives to selling a trade mark?
- Summary
Can I sell my trade mark?
A registered trade mark is personal property and can be assigned (sold) like other property, either with the goodwill of a business or independently. Assignments can be ‘partial’, meaning you can sell the mark only for some of the goods/services in the registration, or even limit the transfer to use “in a particular manner or a particular locality.” The assignment must be in writing and signed by or on behalf of the seller. If the trade mark has co-owners, you cannot assign your share without the consent of the other owners.
Once the transfer document is signed, your adviser should record the assignment at the UK Intellectual Property Office (UKIPO). While the title passes under the signed assignment, unrecorded transactions can be ineffective against someone later acquiring a conflicting interest without knowledge of the transfer of ownership. There are also potential cost consequences if you need to sue for infringement before the recordal has been processed.
Why might I want to sell my trade mark?
There are good commercial reasons to sell, they include the following:
- To unlock value from a name with strong recognition in a market that you are leaving, or where a third party sees strategic value.
- To simplify a sale or restructure. In corporate deals, buyers often want trade marks parked in a clean intellectual property holding company or moved to reflect post deal ownership.
- To monetise noncore brands. If you have rebranded or retired a product, an external buyer may see life in the old trade mark.
- To resolve disputes. Settlement terms sometimes include purchasing the mark and licensing it back, avoiding ongoing conflict.
We often see these decisions alongside broader trade mark portfolio management work, where clients streamline rights and reduce renewal spend.
How do I value my trade mark?
All that is necessary for a valid contract of sale is that a nominal purchase price is paid (usually £1). There is often significant goodwill associated with the mark, which is to be transferred along with it. There are various methods for valuing goodwill and intellectual property rights and the advice of an accountant is often required to achieve a fair and accurate price. For example, the “cost method” bases the price on the costs incurred in creating the goodwill so far, but does not take into account the market value of the product or service in question.
The “market value method” looks at other comparable transactions in respect of similar goods or services and the “income” or “economic benefit method” takes into account the potential of the mark for generating revenue in the future.
It is for the buyer and seller to agree on the most appropriate valuation method for the goodwill in question and this may depend on factors such as the amount of time in business, the nature of the market and industry and the relative bargaining position of the parties.
Do I need a lawyer to sell a trade mark?
You do not have to use a lawyer, but most businesses do, because poorly drafted agreements can create big headaches later. A good assignment agreement does more than say “we transfer the mark”. It sets the effective date, sets out exactly what is being transferred (registered marks, pending applications, domain names, social handles, design rights linked to the brand), and states whether goodwill is included, what happens to historic claims, and whether licences, consents or security interests exist. It should also cover seller warranties (for example, concerning ownership, noninfringement claims and there being no undisclosed licences) and, where appropriate, indemnities. Your adviser will make sure the deal is recorded properly with the UKIPO and, if needed, in other jurisdictions.
Can I sell a trade mark to a buyer based outside the UK?
The buyer’s location doesn’t matter. What you are transferring is the UK registration and the rights attached to it. If you and the buyer also want to deal with EU or international registrations, you will need to execute and record separate assignments with the EUIPO or via the WIPO/the relevant national trade mark offices. Build that into your deal timetable so protection remains continuous across territories.
Can I sell a trade mark if I have licensed it to someone else?
By default, a licence of a UK registered trade mark is binding on a successor in title (i.e. the buyer), unless the licence says otherwise. That means the buyer commonly takes the mark subject to any existing licences and their terms relating to territory, quality control and termination. Good practice is to disclose all licences (and record them if they are not already recorded), confirm whether any licensee consent is needed on a change of ownership, and build in practical transition steps (for example, a short notice to licensees telling them where to send future royalty reports).
How do I sell a trade mark?
1) Get your paperwork straight. Record the registration numbers, a clear chain of title (including any name changes or mergers), details of any licences or security interests, and evidence of use and goodwill if you are also transferring those. If the mark is co-owned, line up written consents from all co-owners.
2) Find a buyer and negotiate the deal. Some sales happen bilaterally; others go through brokers or arrive as part of wider negotiations (for example, a settlement of overlapping rights). Agree the scope: full assignment or partial? Partial assignments are common where the buyer only needs some goods/services or where you both want to avoid consumer confusion between two product ranges. Price is usually tied to brand strength, growth prospects and comparable royalty rates.
3) Draft and sign the assignment. The assignment must be in writing and signed by (or for) the seller. Make sure any third-party consents are in place and that the agreement clearly lists the registrations, applications and any connected assets (like domain names) that are to be transferred with the brand.
4) Record the transfer with the UKIPO.
- For a full transfer, file Form TM16 (fee £50—covering one or more trade marks owned by the same proprietor).
- For a partial transfer (only some goods/services), file Form TM16P (fee £50 per mark).
The forms aren’t a substitute for the signed assignment, but they are necessary to update the register. Recording within six months of the transfer protects you in respect of costs if you need to enforce the trade mark for infringing acts between the deal date and the recordal date, and ensures that your title claim beats any later conflicting acquisitions made in ignorance of your deal.
5) Tidy up the rest. Notify licensees and distributors, update packaging and marketing, transfer related domains and social handles, and agree any interim coexistence, transitional use or quality control measures to minimise consumer confusion in the handover period. For groups, align renewals and centralise records.
What are the costs involved in selling a trade mark in the UK?
For the seller, the costs involved will mainly be accountant’s fees for evaluation of the value of any goodwill connected with the trade mark and lawyers’ fees for any due diligence and the preparation and execution of the assignment agreement. There is also a registration fee of £50 to record the change of ownership at the UK IPO, although this is usually paid for by the buyer.
How long does it take to sell a trade mark?
The timetable depends mostly on finding a buyer and agreeing on terms, which can be anything from days to months. Once filed, UKIPO usually records a change of ownership within weeks; typically, two months from filing to issuing of the updated certificate, but this can vary. A pragmatic approach is to aim for recordal within six months of the assignment date to preserve litigation cost recovery and priority against unknown conflicting interests.
What are the alternatives to selling a trade mark?
Sometimes you want to achieve a positive return without giving up ownership. You could achieve this through the following actions:
- License the mark (exclusive or non-exclusive) for royalties, with strong quality control provisions.
- Franchise the brand with a wider operational playbook (think training and supply rules).
- Coexistence agreements can settle overlaps where both parties are to keep using similar marks in defined lanes.
- Granting security over trade marks can support financing without disposing of ownership. (Security interests are registrable transactions and can be recorded at the UKIPO.)
Summary
Selling a trade mark is a relatively straightforward process. Without qualified advice from a trade mark solicitor, there are several pitfalls that could result in you losing out or even becoming liable for a lot more than you expected to gain. You must look after your trade marks as any other valuable business asset so that when you decide to sell, you can profit from all your hard work in building up a strong reputation and brand that others will want to acquire.
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