Trademark Ownership in the Philippines: Why Registration Beats Prior Use

In business, a trademark is more than a logo or a name—it is a symbol of trust and quality that customers associate with a brand. But when two companies claim ownership of the same mark, who prevails? The Supreme Court's ruling in Ma. Sharmaine R. Medina/Rackey Crystal Top Corporation v. Global Quest Ventures, Inc. clarifies how Philippine law now resolves such disputes: registration, not prior use, determines trademark ownership.

The Shift from Use to Registration

Philippine trademark law underwent a significant change with the enactment of Republic Act No. 8293, the Intellectual Property Code. Under the old regime, ownership of a mark was acquired through actual use. The IP Code reversed this principle, providing that rights in a mark are acquired through registration made validly in accordance with its provisions.

A trademark is defined as any visible sign capable of distinguishing the goods or services of an enterprise. Registration grants the holder a prima facie presumption of ownership. However, this presumption is not absolute. It can be rebutted if the registration was obtained fraudulently or in bad faith.

The "Mr. Gulaman" Dispute

The case centered on the trademark "Mr. Gulaman," a name used for a gulaman jelly powder mix. Global Quest Ventures, Inc. (Global) claimed continuous use of the mark since 2000, supported by a 1996 copyright registration and a deed of assignment from the original creator, Benjamin Irao, Jr. Meanwhile, Ma. Sharmaine R. Medina (Medina) registered the mark in 2006.

Global filed a petition to cancel Medina's registration, arguing she had copied the mark. The Bureau of Legal Affairs of the Intellectual Property Office (BLA-IPO) granted the petition in 2008. Medina's appeals to the Office of the Director General (denied in 2012) and the Court of Appeals (affirmed in 2013) were unsuccessful. The Supreme Court upheld the cancellation in 2021.

What the Supreme Court Said

The Court emphasized that under the IP Code, prior use no longer determines ownership. As the ruling states: "At present, as expressed in the language of the provisions of the IP Code, prior use no longer determines the acquisition of ownership of a mark in light of the adoption of the rule that ownership of a mark is acquired through registration made validly in accordance with the provisions of the IP Code."

Yet the Court also recognized that registration is not a shield against bad faith. It noted that "the presumption of ownership accorded to a registrant must then necessarily yield to superior evidence of actual and real ownership of a trademark." In this case, the evidence of Global's prior use and the circumstances of Medina's registration supported a finding of bad faith, justifying cancellation.

What This Means for Businesses

The ruling carries two practical lessons. First, registration is essential. A business that uses a mark for years without registering it remains vulnerable to someone who registers first. Second, registration is not absolute. A certificate of registration can be cancelled if obtained through fraud or bad faith, so applicants must act in good faith.

Practical Takeaways

• Register trademarks promptly. Registration, not use, establishes legal ownership in the Philippines.
• Monitor trademark filings. Watch for applications covering similar marks to oppose them early.
• Document prior use. If challenging a registration, gather substantial evidence of actual use and any proof of bad faith.
• Act in good faith. Avoid registering marks you know belong to another; such registrations are vulnerable to cancellation.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.