A proper and distinctive name of the company, which reflects the object of the firm has a great relevance in the course of business. Because of this reason firms often select a name which contains either their own word trademark or a tradename or a distinctive word. There are however cases in which other companies would like to make profit from the in abroad established businesses and use the trademark or name of other companies without any approval.

There are different cause of actions which protects the owner of the trademarks and the tradename from the infringes.

If a company is registered in the Commercial Register or the application is filed, another company shall not use the same name, otherwise the application will be rejected. If two companies are, however, registered under the same or similar name, the company who was registered first has the cause of action against the other firm who used an identical or similar name. This action is based on the Hungarian Civil Code sec. 74 ss. 4, that nobody shall violate the personal rights of any other person (including legal entities). If a person uses a name identical or similar to any other person's name, regardless of its intent, violates the personnel rights of the other person (s. 74 ss. 4 Civil Code). This rule applies for companies registered in the Commercial Register when a registration constitutes an infringement of personnel rights. The intent of the infringing party has a relevance when the damages are stipulated in the judgement (High Court Gf. II. 32 078/1990). According to the valid rules and case law (the party whose tradename or trademark was used illegally does not have a claim of action based on the Competition Act, namely that the consumer were mislead or the goodwill of the competitor was harmed (High Court of Hungary Nr. Cgf. II. 31 168/ 1990).

If a company would like to register a trademark as a company name without any licence from the owner of the trademark (name) has a cause of action based on the Trademark Act (s. 13 ss. 1). As the owner of the trademark has the exclusive right to use the trademark, it constitutes a trademark infringement to use the trademark or the tradename in the company name. The owner may claim for refrain form the illegal use of the mark/name and may claim for damages (High Court Pf. IV.21.483/1994).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

For further Information please contact: Beiten Burkhardt Mittl & Wegener Lawyers, J¢zsef n dor t‚r 9, H-1051 Budapest, Tel: (36)(1)2661810, Fax: (36)(1) 2661811, or enter a text search "Beiten Burkhardt Mittl & Wegener" and "Business Monitor".