The Role of Collective Trademarks in Creating Clusters of SMEs: Creating the Missing Link.

Collective marks guarantee ownership over a community’s intangible wealth and in this sense not only reinforce its branding activities, but set up a new structure in which community business can function. Systems of local innovation may thus be developed through the design of an adequate legal infrastructure, paving the way for the solution of policy concerns, such as rural exodus or unemployment. Cluster theory argues that, if small and medium sized enterprises intensify their degree of interaction to build up networks, this reduces costs, dependence on large firms, provides access to new markets and helps improve the position of the cluster in the market. All these functions can be reinforced through collective marks, which offer a legal context for the cluster’s governance structure, its standards and quality controls and system of collaboration. These features are particularly of relevance in a sector like tourism, where cooperation is a prerequisite for success. Empirical evidence suggests a certain sense of confusion on the role of trade mark protection in clusters: Individual marks are used as if they were collective marks, collective marks are used without further consideration of the economic aspects or intellectual property protection is altogether ignored. In practice the wide range of opportunities provided by collective trademarks remains unexploited. Interdisciplinary approaches to IP may help to bridge a gap, observed both within academia and in practice, and thus join the IP law perspective to the evolving management literature on cluster theory.