How East African companies are protecting their brands
East African economies have grown so rapidly in recent years that large brand-owners are not only making substantial investments in their brands, but are willing to go to court to protect them. Kenya in particular has seen a sharp increase in High Court litigation on intellectual property (IP) matters, and regional markets generally have become more complex and litigious as far as IP is concerned.
Until relatively recently, the region’s economies were not big enough to make it worthwhile for brand-owners to enforce their rights when these were infringed. They tended to either allow infringements to occur or to deal with them commercially. That has changed. Markets are growing, the middle class is expanding, and global companies are now investing in their East African brands, and spending substantially on advertising, promotion, sales and distribution networks. As a result, they have a stake in protecting their brands that they did not necessarily have before.
Another factor spurring big brand-owners to take steps against copycatting and passing off is the nature of the parties infringing IP rights. The ones infringing are local companies, not individuals or small players. Big brand owners are willing to go to court against them because they can obtain damages awards that mean something.
Apart from acting against trade mark infringements, brand-owners are also increasingly undertaking transactions involving major IP assets. Brand migration – whether merging two brands or moving from one brand to another – can be highly complex, particularly with cross-border transactions. The parties need to be aware of the risks and uncertainties of brand migration, such as the possible existence of conflicting rights and the fact that certain clearances might be required. In addition, there are complex licensing arrangements that may arise from the process as well as potential IP carve outs and assignments, let alone the underlying tax and competition law issues.