In today’s competitive economy, a trademark is one of the most valuable assets of any business. A trademark represents the identity of a brand, and consumers rely on it to assess the origin, quality, and reputation of goods or services when making purchasing decisions. For this reason, many countries—including Iran—provide strong legal protection for trademarks. Such protection not only safeguards the interests of business owners but also protects consumers. Consequently, trademark infringement in sectors such as pharmaceuticals, aviation, and automotive parts can have serious implications for public health and safety.

This article explains in simple terms what a trademark is, the characteristics it must possess, what constitutes trademark infringement, and the legal consequences that may arise when infringement occurs.

What Is a Trademark?

The legal framework governing trademarks in Iran is set out in the Industrial Property Protection Act of 2024 (hereinafter referred to as the IPPA). According to Article 95(1) of the IPPA, a trademark is a visible sign that distinguishes the goods or services of one person from those of others. A trademark may consist of words, images, or a combination of both.

 

Key Characteristics of a Trademark

The most important characteristics of a trademark include the following:

  • Distinctiveness

According to the definition provided in the IPPA, the most essential feature of a trademark is its distinctiveness. In other words, the mark must be capable of distinguishing the goods or services of one business from those of its competitors.

For this reason, generic or purely descriptive signs are generally not registrable because they cannot effectively distinguish one business from another. By contrast, the more unique and creative a trademark is, the stronger the legal protection it can receive.

For example, using the word or image “Apple” for electronic goods such as smartphones or laptops is highly distinctive. However, if the same mark were used for a product such as apple jam, it would not be considered particularly distinctive and could therefore be more vulnerable to imitation.

 

·      Not Misleading

A trademark must not deceive or mislead consumers. Under Article 96(3) of the IPPA, a mark cannot be registered if it misleads consumers regarding matters such as the geographical origin of goods or services, the nature or type of the product, the quality or characteristics of the goods, or the quantity or price of the product.

For example, if a product is manufactured in Iran but is marketed under a mark that leads consumers to believe it originates from another country, such a mark would be considered misleading.

 

What Are the Benefits of Registering a Trademark?

Registering a trademark grants the owner exclusive legal rights. The main advantages include:

  • Exclusive right to use the mark in the marketplace
  • The ability to prevent unauthorized use by competitors
  • The right to bring legal action in cases of infringement
  • Increased brand credibility and commercial value
  • The ability to grant licenses or authorize others to use the mark

Under the IPPA, the owner of a registered trademark—or their legal representative—may file a claim before the competent court against any person who uses the mark without permission or uses a similar mark in a way that could mislead consumers.

 

What Is Trademark Infringement?

Trademark infringement occurs when a person uses a mark that is identical or confusingly similar to a registered trademark without the owner’s permission in a way that:

  • misleads consumers about the origin of goods or services, or
  • damages the reputation and distinctiveness of the trademark.

In general, trademark infringement can be divided into two main categories.

1. Infringement of the Primary Function of a Trademark

This type of infringement relates to the core function of a trademark—identifying and distinguishing goods or services. It occurs when an identical or similar mark is used for goods or services that are identical or similar to those covered by the registered trademark.

In such cases, the use of the similar mark may lead consumers to believe that the goods or services originate from the original brand.

2. Infringement Through Damage to Reputation

In some situations, infringement may occur even if consumers are not directly confused. This happens when the use of a similar mark harms the reputation or prestige of the original brand.

For example, using a name similar to a well‑known brand to sell low‑quality goods may damage the reputation of the original brand, even if consumers recognize that the products are not exactly the same. In such cases, the law aims to protect the value and reputation of the trademark itself.

When courts examine trademark infringement cases, they generally assess the overall impression created by the mark rather than analyzing each element separately. What matters most is the overall perception formed in the consumer’s mind. Two marks may share certain elements yet create different overall impressions, in which case infringement may not be established.

 

Can Company Branches or Representatives Use the Same Trademark?

A common question in trademark law is whether branches or representatives of a company may use the same trademark, or whether such use could be considered infringement.

Under the IPPA, the use of a registered trademark by anyone other than the owner requires the owner’s authorization.

In the case of a branch office, the branch does not have a separate legal personality and is considered part of the parent company. Therefore, the use of the trademark by a branch is generally permissible and does not constitute infringement.

However, a representative or agent usually has an independent legal personality. As a result, the representative must obtain formal authorization from the trademark owner before using the mark. The parent company may grant such rights through agreements such as a trademark license agreement or a trademark assignment agreement.

 

Trademark Infringement in the Online Environment

Consider a company that produces and sells coffee and has registered the trademark “Aroma Coffee.” After some time, the company discovers an online store operating under the name “AromaCoffeeShop,” which sells coffee and related products and also uses the word “Aroma” in its advertising.

This raises an important question: could the use of this name online constitute trademark infringement?

To answer this question, it is necessary to consider the provisions of Iran’s Electronic Commerce Law, which regulates trademark use in the digital environment.

According to Article 66 of the Electronic Commerce Law, the use of trademarks as domain names or in any form of online display that deceives consumers or causes confusion regarding the authenticity of goods or services is prohibited. Violators may be subject to the penalties provided under the law.

Therefore, if the use of the name “AromaCoffeeShop” leads consumers to believe that the online store belongs to, or is affiliated with, the company that owns the trademark “Aroma Coffee,” such use may constitute trademark infringement in the online environment.

 

What Are the Penalties for Trademark Infringement?

If a person uses another party’s registered trademark without authorization and in violation of the law—particularly in a way that misleads the public—they may face several legal consequences.

These may include:

  • compensation for the damages caused
  • confiscation of property or profits obtained through the infringement
  • a monetary fine ranging from 80 million to 165 million Iranian tomans, or
  • a fine equal to twice the amount of the damages caused, whichever is higher.

If the infringement occurs in the online environment, the offender may also face imprisonment for a period of more than six months up to two years, in addition to the above penalties.

 

Conclusion

Trademarks are among the most important legal tools for protecting brand identity, preventing unfair competition, and safeguarding consumers. Trademark infringement can cause significant harm to businesses and may also mislead customers.

The more aware and proactive businesses are in registering and protecting their trademarks, the better they can safeguard their interests. At the same time, strong trademark protection contributes to the development of a healthier and more transparent marketplace for everyone.