TaxCalc.pk
Cancel squatting or dead trademarks in Pakistan. Learn Section 38 non-use removal, rectification proceedings on Form TM-26, High Court vs Registrar jurisdiction
By Syed Asad Hussain Zaidi · 8 September 2026
Author Note / Last Updated: Updated September 2026 by Syed Asad Hussain Zaidi | Advocate High Court | Senior IP Litigation & Appellate Counsel. One of the most frustrating obstacles encountered by businesses registering a brand in Pakistan is receiving an official Examination Report (Form TM-9) citing an identical or deceptively similar mark that was registered ten or fifteen years ago, but whose owner has long since ceased trading, shut down operations, or abandoned the Pakistani market. In trademark jurisprudence, the official register maintained by IPO-Pakistan is not an archival graveyard for obsolete names. A trademark is a statutory property right granted on the fundamental condition of active commercial use. Under Pakistani law, the public register must reflect commercial reality. When a registered mark sits dormant, unused, or was obtained through fraud or without a genuine intention to trade, the law provides a powerful legal scalpel: Rectification and Cancellation of the Register. Governed primarily by Section 38 (Non-Use Removal) and Section 96 (Rectification) of the Trade Marks Ordinance, 2001 (TMO 2001), rectification proceedings allow aggrieved businesses to strike blocking marks from the register, clearing the path for their own legitimate brand registrations. This treatise provides corporate counsel, litigators, and enterprise brand owners with an exhaustive roadmap to removing abandoned trademarks in Pakistan. --- Statutory Foundations: Section 38 Non-Use Cancellation Section 38 of the Trade Marks Ordinance, 2001 codifies the doctrine of "use it or lose it". Under Section 38(1), a registered trademark may be taken off the register in respect of any of the goods or services for which it is registered, on an application made by any "person aggrieved" to the High Court or to the Registrar, on either of two distinct statutory grounds: Ground A: Registration Without Bona Fide Intention (Section 38(1)(a)) This ground targets trademark squatters and traffickers—speculators who monitor international brand launches and register the mark in Pakistan before the foreign company enters the market, intending to extort an inflated buyout or licensing fee. The applicant must prove that the registrant had no genuine commercial intention to use the mark at the time of filing. The applicant must further establish that no bona fide commercial use occurred up to one month prior to the date of the rectification application. Ground B: Five (5) Years Continuous Non-Use (Section 38(1)(b)) This is the workhorse provision of Pakistani trademark litigation. Even if an enterprise originally registered a mark in good faith and utilized it for years, if it subsequently abandons the brand: If a continuous period of five (5) years or more has elapsed during which the trademark was a registered trademark, and During which there was no bona fide use thereof in relation to those goods or services by any proprietor thereof for the time being, The mark is legally dead and liable to be expunged from the register upon application. --- Who Qualifies as a "Person Aggrieved"? Under Pakistani jurisprudence, a stranger cannot initiate rectification proceedings out of mere curiosity. The petitioner must establish locus standi as a "Person Aggrieved": The Supreme Court of Pakistan and the High Courts have established a liberal, commercially realistic interpretation of "person aggrieved": Blocked Applicants: Any person whose pending trademark application has been blocked, objected to, or cited against under Section 17 by the Examiner based on the prior registration. Defendants in Infringement Litigation: Any enterprise that has received a cease-and-desist letter, had its inventory seized in market raids, or is defending a trademark infringement or passing-off suit in court. Legitimate Commercial Competitors: Any active trader in the same Nice class whose legitimate commercial expansion is obstructed by the presence of a dormant mark on the register. --- Jurisdictional Forum: High Court vs. Registrar of Trade Marks Under Section 96(1) and Section 38(1) of the Trade Marks Ordinance, 2001, rectification applications may be lodged either before the Registrar of Trade Marks or directly before the High Court having territorial jurisdiction (Sindh High Court at Karachi, Lahore High Court, Islamabad High Court, Peshawar High Court, or Balochistan High Court). THE PENDENCY RULE (SECTION 96(2)): If a legal suit concerning the trademark in question is already pending before a High Court or District Court (e.g., an infringement lawsuit or passing-off action), the application for rectification CANNOT BE FILED WITH THE REGISTRAR. It must be submitted exclusively to the High Court before which the suit is pending or which has supervisory jurisdiction. --- Step-by-Step Rectification Procedure (Form TM-26) Filing a non-use cancellation petition requires rigorous evidentiary preparation. A successful campaign follows a strict four-stage lifecycle: Stage 1: Pre-Filing Market Investigation & Non-Use Audit Before filing, the petitioner must build a prima facie evidentiary dossier establishing non-use: Market Investigator Reports: Certified affidavits from private commercial investigators who visited major wholesale hubs (e.g., Karachi, Lahore, Rawalpindi, Faisalabad) confirming zero availability of the product. Corporate Registry Checks: Inquiries with the Securities and Exchange Commission of Pakistan (SECP) and FBR confirming whether the registered company is active, tax-compliant, or struck off. Digital Footprint Audit: Archival searches (Wayback Machine, domain checks, social media scans) confirming zero commercial advertising over the preceding five years. Stage 2: Filing Form TM-26 and the Statement of Case The petitioner files Form TM-26 accompanied by the statutory fee and a formal Statement of Case executed by an Advocate of the High Court. The Statement of Case must plead: The exact grounds of locus standi establishing that the applicant is a "Person Aggrieved". The registration details of the target mark (Number, Class, Date of Registration, Proprietor Name). Specific factual averments satisfying Section 38(1)(a) or Section 38(1)(b). A verified prayer requesting the Registrar or High Court to issue an order directing the rectification of the register by expunging the mark. Stage 3: Notice to the Registered Proprietor and Counter-Statement Upon receipt, the Registry transmits a formal copy of Form TM-26 and the Statement of Case to the registered proprietor at their registered address for service in Pakistan. The registered proprietor is granted two (2) months to file a Counter-Statement on Form TM-27 contesting the application. Default Judgment: If the registered proprietor fails to file a Counter-Statement within the statutory two-month period (or any extension granted), the allegations of non-use are deemed admitted, and the Registrar issues an order striking the mark from the register! Stage 4: Shifting the Evidentiary Burden Under Pakistani law, once the applicant makes out a prima facie case of non-use through market affidavits, the burden of proof shifts decisively onto the registered proprietor to establish affirmative commercial use. To survive cancellation, the proprietor cannot rely on mere verbal assertions; they must produce: Commercial sales invoices spanning the five-year period. Bills of Lading, shipping manifests, and customs clearance documents. Audited financial accounts reflecting marketing expenditure in Pakistan. Physical packaging specimens distributed in Pakistani retail outlets. --- Statutory Defenses: How Registrants Defend Against Section 38 A registered proprietor facing non-use cancellation can defeat the petition by proving one of the recognized statutory exceptions: Defense A: "Special Circumstances in the Trade" (Section 38(3)) Under Section 38(3), non-use will not result in cancellation if the proprietor proves that the non-use was due to special circumstances in the trade and not to any intention to abandon the trademark. Valid Circumstances: State-imposed import prohibitions (e.g., SBP foreign exchange restrictions halting raw material imports), wartime blockades, or government embargoes. Invalid Circumstances: Mere corporate insolvency, marketing budget cuts, lack of commercial demand, or internal shareholder disputes are not special circumstances. Defense B: DRAP Pharmaceutical Delays In pharmaceutical marks (Class 5), international drug manufacturers frequently secure trademark registrations but must wait three to four years to obtain Marketing Authorization (Drug Registration) from the Drug Regulatory Authority of Pakistan (DRAP). Pakistani courts recognize bona fide pending DRAP regulatory applications as a legitimate defense against non-use cancellation. --- Strategic Playbook: Clearing Blocking TM-9 Objections The most common real-world application of Section 38 is breaking an examiner dead-end during routine trademark prosecution: By coupling a pending application with an aggressive Section 38 petition, a business systematically cleanses the register of dead clutter, converting an impending refusal into an uncontested registration. --- Strategic Checklist for Litigators & Brand Owners Before initiating or defending a trademark rectification proceeding in Pakistan, verify these critical tactical milestones: [ ] Verify the 5-Year Threshold: Calculate five continuous years strictly from the date the target mark was actually entered into the register, not from its retroactive filing date. [ ] Conduct Exhaustive Market Surveys: Secure independent affidavits from wholesale market associations (Karachi, Lahore, Rawalpindi) attesting to total absence of goods. [ ] Establish Aggrieved Person Status: Formally file your own trademark application or document an ongoing dispute to perfect your standing under Section 38. [ ] Audit Related Classes: Review whether the registrant owns valid registrations in associated classes that might be asserted under Section 41. [ ] Check for Pending Lawsuits: Confirm no prior infringement or passing-off litigation is pending before filing with the Registrar (to avoid Section 96(2) jurisdictional dismissals). [ ] Calendar TM-27 Deadlines: If defending a mark, diary the strict two-month counter-statement window to prevent default judgment. --- Conclusion: Reclaiming the Register for Active Commerce The Trade Marks Registry of Pakistan exists to protect dynamic, operational brands—not to preserve hollow monopolies for absentee corporate ghosts. When a registered mark sits abandoned for five years or was hoarded by a bad-faith squatter, Section 38 and Section 96 of the Trade Marks Ordinance, 2001 provide a decisive statutory remedy. Navigating rectification applications, evidentiary affidavits, and High Court jurisdiction requires sophisticated IP litigation capability. For professional assistance in expunging blocking trademarks, clearing examiner citations, or defending corporate registrations against non-use attacks, contact our IP Litigation Practice Group at TaxCalc.pk / Zaidi & Associates.