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Abstract

This article addresses the capacity of trade marks to provide assurance concerning product quality and the importance of this capacity in promoting competition and various forms of innovation. It considers the meaning of “quality” in this context and shows how this can include the aesthetic and intangible characteristics of products as well as their functional and material characteristics. And it is suggested that quality assurance should cover the whole range of variable product characteristics to which at least some consumers attach value. This is because the key economic problem that underlies the need for this assurance is the difficulty that consumers may face in ascertaining or verifying the presence or absence of certain product characteristics. This article explains this problem of information asymmetry and shows how trade marks enable firms to mitigate it by providing quality assurance.

As a matter of law, a trade mark merely guarantees that there is unitary control over the quality of marked products. The force behind a trade mark’s quality assurance is economic in nature and depends on its owner’s interest in maximizing the trade mark’s value as a marketing resource. There are various ways in which the owner can build up this value. These include investing in advertising and other promotional activity and in developing the trade mark’s capacity to confer intangible quality on marked products by establishing an image or particular set of associations for it. This explains the dynamic nature of a trade mark’s capacity to provide quality assurance. The article notes how European trade mark law provides additional protection for some trade marks that focus directly on their value and vulnerability as marketing resources and does not simply rely on protecting the integrity of the underlying legal guarantee.

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