Trademark Non-Use Cancellation in Nepal: The 1-Year Rule

The rule, plainly stated

Section 18C provides that where a registered trademark is not brought into use within one year of registration, the Department may inquire and cancel the registration. The policy is anti-hoard: Nepal's registry is not a warehouse for marks registered speculatively and never used.

The one-year clock runs from registration — not from filing, and not from launch. A mark that registers in month nine of a phased market entry has, at most, three months of grace before the rule engages. For foreign brands entering Nepal on investment timelines, that arithmetic catches people.

• Clock: one year from the registration date
• Trigger for inquiry: the mark has not been brought into use
• Consequence: Departmental inquiry leading to cancellation

What counts as use

Use means genuine commercial use of the mark as registered, for the registered goods or services, in Nepal. The familiar principles apply and have teeth here: use of a slightly different form may not count as use of the registration; token or sham use ('sold three units to a friendly company') does not survive scrutiny; and use must be in Nepal — sales in India do not keep a Nepalese registration alive.

Use by a licensee counts if the licence relationship is real and, ideally, recorded (Section 21D recordal — see our licence-recordal guide). Use by a related company counts with the corporate papers showing the connection. What does not count: internal plans, import permissions, and the intention to use next year.

The use file: build it from month one

The defence to Section 18C is built before anyone asks. For each registration, keep a use file: dated specimens of the mark in use, invoices and customs documents, advertising records, distribution agreements, and a short annual note of where and how the mark is being used. Ten minutes a quarter, per mark.

The file earns its keep in three scenarios: a Departmental inquiry, a non-use cancellation action brought by a competitor, and any opposition where the other side alleges your mark is a dead registration. All three are answered from the same folder.

• Quarterly habit: add dated specimens, invoices, ads to a per-mark use file
• Record licences so licensee use is attributable to you
• When phasing a launch, either file later or start genuine use earlier

Defensive registrations: the honest calculus

Defensive filings — registrations held in classes or forms beyond current use — are a legitimate strategy everywhere, but in Nepal they carry the Section 18C exposure directly. A defensive registration has, by definition, no use in year one unless the brand's presence extends there.

The honest calculus: file defensively only where conflict risk is concrete, and have a use path (genuine use, a real licensee, or phased use within the year) for each. Where neither exists, weigh the registration's defensive value against its cancellation risk — a registration that dies at the first challenge protected nothing.