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Changes in Indian trading regulations – what does this mean for brand owners?


25th Jan 2012

Significant developments in the foreign investment regime for India are set to give brand owners access to greater numbers of Indian consumers and have made it important to ensure that company names, brands and products are protected in the country.

As reported in the World Trade Mark Review 1, a recent decision by the Indian government has permitted 100% foreign direct investment (FDI) in single-brand retailing in the country, up from the previous cap of 51%, opening the doors to foreign companies to own local businesses outright rather than seek 49% investment from a local business partner in a joint venture or franchising relationship.

Although increasing a stake in a local business above 51% carries a requirement to source at least 30% of goods from SMEs in India, the changes are expected to lead to an influx of investment by international brand owners who can now retain greater control over their retail operations, the quality of their goods and their local reputation. An increase in FDI investment for multi-brand retail from 0 to 51% is also expected to enhance the presence of foreign supermarket chains in India, allowing international brand owners to sell a variety of branded products in greater numbers to local consumers.

The changes highlight the clear importance of extending and maintaining effective brand protection in India. If you are considering increased brand promotion and sales in the country, we have good relationships with local Attorneys and can work with them to support you in registering your company name, house mark, key brands, marks, and logos to ensure that you have a robust trade mark portfolio for the new Indian market. We can also advise on further aspects of Intellectual property protection for products, including patents and registered designs.

  1. India – Preparing for entry: India widens the market opportunities for international brands”, by Jack Ellis (18th January 2012)

This article is for general information only. Its content is not a statement of the law on any subject and does not constitute advice. Please contact Reddie & Grose LLP for advice before taking before any action in reliance on it.

Author
Tom Sharman
Partner
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