There have been some recent changes which will positively impact smaller/medium sized companies which have – or would like to have – a large number of shareholders.  The Takeovers Code protects the rights of shareholders.  It does this by regulating events and transactions that will affect the voting rights attached to their shares. While this Code used to apply to small unlisted companies, the Regulatory Systems (Economic Development) Amendment Act (No 2) 2018 has created a narrower definition of a “code company”. Now, a code company is a business that is listed on the stock exchange or:

  • has 50 or more shareholders and 50 or more share parcels; and
  • is at least medium sized.

The key point here is that a medium sized company is one with at least $30 million in total assets (including the assets of any subsidiaries) or has a total revenue of at least $15 million when assessing the business’ two most recent accounting periods.   This lifts the burden off start-ups and SMEs, allowing them the flexibility to manage their business and raise capital without regulatory interference.

We have had clients in the past who have had to consider how they will comply with the Takeovers Code when raising funds that means the number of shareholders go above 50 – this change will be welcome for such businesses.

If you’d like to learn more you can contact Kris Morrison (krismorrison@parryfield.com) or Steven Moe (stevenmoe@parryfield.com) on 03 348 8480.

Before applying to register your mark, you should always search the trade marks register (here) for existing trade marks. If your mark is “confusingly similar” to an existing trade mark that provides similar goods or services, you will be unable to register your mark. New Zealand case law[1] sets out three questions to determine whether your mark is confusingly similar to another person’s trade mark:

  1. Is your proposed mark in respect of the same or similar goods or services covered by any of the other person’s trade mark registrations?
  2. If so, is your proposed mark similar to any of the other person’s trade mark registrations for the same or similar goods identified in question one?
  3. If so, is the use of your proposed mark likely to deceive or confuse?

Step one: Similarity of goods and services

When registering to protect your mark, Intellectual Property Office NZ (IPONZ) requires each mark to be registered within one or more goods or services specifications. If your mark is similar to a registered trade mark, but relates to a completely different type of goods or services, IPONZ may allow it to be registered. Instead of applying a strict test, IPONZ carries out a broad comparison of the goods or services each mark covers. Helpful factors include comparing the uses, users and physical nature of the goods or services. Comparing how the goods or services reach the market and asking whether the goods or services covered by the respective marks are competitive may also be taken into account.

Step two: Comparison of marks

To determine whether the marks are similar, there are five basic guidelines:[2]

  • compare the marks as a whole and consider the overall impressions they give;
  • compare the ideas that the marks convey;
  • consider how “imperfect recollection” may contribute to confusion;
  • compare the look and sound of the marks (where appropriate); and
  • compare the trade channels of the goods or services.

Step three: Likely to deceive or confuse

IPONZ describes the test as whether there is a, “reasonable likelihood of deception or confusion among a substantial number of persons,” if the applicant uses their mark for any of the goods or services covered by registration. This requires a broad examination of all the relevant factors. However, three points they take into account are:

  • the visual, aural and conceptual similarities between the marks;
  • the distinctiveness of the proposed mark. If the proposed mark is generally quite distinctive, yet it looks similar to an already registered mark, there is a higher risk that the public will be confused;
  • the degree of similarity between the goods and services.

If IPONZ believes people will get confused between the proposed mark and the registered mark, then they will decline the application for registration.

Should you need any assistance with these, or with any other Commercial matters, please contact Steven Moe (stevenmoe@parryfield.com) or Kris Morrison (krismorrison@parryfield.com) at Parry Field Lawyers (03 348 8480).

For a more general overview of registering a trade mark, please see this article here.

[1] NV Sumatra Tobacco Trading Co v New Zealand Milk Brands Ltd [2011] NZCA 264.

[2] IPONZ Practice Guidelines: Guideline 10 “Relative grounds- Identical or similar trade marks” (16 November 2009).