January 14, 2025 Copyright ©️ 2025 by goldkeen International Patent & Trademark Joint Office

 

If you're planning to franchise a brand, doing this one extra step can help you avoid the nightmare of a sudden change in ownership at headquarters.

That step is: filing a license registration with the Intellectual Property Office (TIPO).
Currently, the Fair Trade Commission's Guidelines for Handling Franchise Business Conduct do not explicitly mention this process.

However, the requirement is clearly stated in the Trademark Act—specifically, Article 39, Paragraphs 2 and 3:

• “Unless registered with the trademark authority, a license cannot be asserted against third parties.”
• “After registration, if the trademark rights are transferred, the license agreement remains binding on the transferee.”

In simple terms, if you're a franchisee who paid to join a brand and signed a license agreement with the franchisor, and the trademark ownership is later transferred to another party, then your original license agreement will not be enforceable against the new trademark owner unless it was properly registered with the TIPO from the start.

A well-known example is the traditional Taiwanese pastry brand Yu Jan Zai (玉珍齋) from Lukang.
Because they failed to register the license agreement, the case led to a family lawsuit.
Even on appeal, the High Court ruled that no license relationship existed.

Case Reference: 2016 Min-Shang-Shang-Zi No. 3

 

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Has your trademark application already been filed?

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