How to Value a Trademark or Brand

Valuing a trademark means estimating what the registered right is worth, separately from the business around it. Valuers use three approaches: cost, market and income. In Nepal the starting point is the Department of Industry record, because Sec. 16 of the 1965 Act gives title by registration.

Key takeaways

• Three recognised approaches — cost, market and income. A serious report explains its choice.
• A figure for a sale, a loan or a dispute is work for a qualified valuer or accountant. This article is not a valuation.
• The international standard, ISO 10668, requires legal, behavioural and financial analysis before any figure is given.
• Sec. 21D of the Act lets a registered mark be transferred or licensed, which is what makes it a saleable asset.
• An unregistered name is far harder to value: Nepal is first-to-file and there is no record to transfer.
• Sec. 18A takes one application per class, so a mark may not cover the products earning the money.

What does valuing a trademark actually mean?

It means putting a defensible number on the exclusive right in the register, not on the logo file.

The right is what can be sold or licensed. Its worth comes from what it lets the owner do, and what it stops others doing.

So every credible method starts with the legal position, then the money. A weak right earns a smaller figure whatever the sales look like.

Is a brand the same thing as a trademark?

No, and the difference decides what goes into the number. A trademark is the registered sign; a brand is all the customer associates with it.

Goodwill, packaging, recipes, staff, location and a distribution network all sit inside "brand" in ordinary speech.

A trademark valuation isolates the part attributable to the mark. Crediting it with everything the business earns is the commonest error in the field.

Why would a business need the figure at all?

Most often for a transaction: a sale, an assignment of the mark alone, a licence, a franchise or an investment round.

Sometimes for accounts, where an intangible asset acquired in a purchase has to be recognised and measured under the reporting framework in use.

Sometimes for a dispute, where the question is what an infringement cost. Each purpose changes the assumptions, so the report must say which it serves.

Who is qualified to produce one?

A valuer or accountant with intangible-asset experience, working to a recognised standard, usually with a lawyer's view on the legal file.

IP Sewa does not value brands. We are an IP filing practice, so we can tell you what the register says about a mark and where the legal risk sits.

Keep that in mind reading any page on this subject. A blog cannot value your brand.

What are the three recognised approaches?

Cost, market and income. They answer different questions, and a valuer often runs more than one as a cross-check.

The cost approach asks what it would take to build the mark again: registration, design, advertising, years of use.

The market approach asks what comparable marks changed hands for. It needs real transactions between real parties.

The income approach asks what future benefit the mark can be expected to produce, then converts that stream to a present value.

What is relief from royalty?

It is a way of framing the income approach. The valuer asks what the business would pay to licence the mark if it did not own it.

Those notional payments are treated as the benefit of ownership, then discounted to a present value over the period the mark can be used.

Two things drive it: the revenue the mark is attached to, and the rate a real licence would command. Both are estimates, and both must be argued.

Why is the market approach so hard in Nepal?

Because comparable evidence barely exists in public. Nepali brand sales are private, and the price is published nowhere you can read it.

The register records that a transfer happened, not what was paid. A valuer sees the fact of a deal without its price.

That pushes most Nepali work towards the income approach, with cost as a cross-check. A page quoting "typical multiples" for Nepal is guessing.

What does the international standard require?

ISO 10668, published in 2010, is the international standard for monetary brand valuation. It prescribes no single method; it sets requirements a valuation must meet.

It requires three analyses before any opinion: legal, behavioural and financial. All three, not whichever is easiest to evidence.

The legal analysis comes first for a reason. Until you know what is registered, in whose name and for which goods, the financial model has nothing underneath it.

WIPO publishes general material on intangible-asset valuation too. None of it replaces a valuer who has seen your file.

What does the legal analysis look at in Nepal?

Whether the mark is registered under Sec. 16, in which classes, in whose exact name, and whether the registration certificate is current.

Those sections are readable. The Act sits in full on the Nepal Law Commission site, so a buyer can check the wording rather than take it on trust.

Sec. 18A takes a separate application for each NICE class, so a business may hold the mark for its packaging but not for its restaurant service.

Sec. 18C also lets the DoI cancel a mark not put into use within a year, so evidence of genuine trading belongs in the legal file, not just the sales file.

Can a Nepali trademark actually be sold?

Yes. Sec. 21D of the Patent, Design and Trade Mark Act 1965 provides for transfer of a registered mark, and for licensing in writing.

Assignor and assignee apply jointly with the prescribed fee. The DoI records the transfer and reissues the registration in the new owner's name.

An agent handling that filing needs a notarised power of attorney. Skipping the step leaves the register naming the wrong owner.

That mechanism is why a mark is an asset rather than a habit: a register, a procedure and a document at the end of it.

Licensing works the same way in writing, which matters for a franchise. Our note on brand registration covers what gets recorded.

What is an unregistered business name worth?

Less, and much harder to argue. There is no certificate, no class list and nothing on the register to transfer.

Nepal is first-to-file: title comes from registration under Sec. 16, so someone else filing the same name first is a live risk, not a theoretical one.

Goodwill still exists, and passing off is recognised in Nepali practice. But that is a claim you must bring, which is a cost, not an asset.

If the plan is to sell or licence within a few years, registration is what makes the conversation possible. Our trademark registration team files at the DoI.

What raises and lowers confidence in a figure?

Evidence, mostly. A valuer discounts what cannot be shown, and uncertainty moves the number the buyer's way.

Timing counts too. A mark inside its 90-day opposition window is not settled, and an objection can stop the certificate issuing.

Where a conflicting mark is published, acting inside that window is the cheap option. Our opposition team reads the record.

How do you gather the evidence?

In a fixed order, because each stage decides what the next is worth looking at.

1. State the purpose and the date. A licence figure and a dispute figure are different numbers from the same mark.
2. Pull the legal file. Certificate, classes, owner name, renewals and anything recorded under Sec. 21D.
3. Check the register for conflicts. Similar marks published in the same class change the risk picture at once.
4. Separate the branded revenue. Which sales does the mark carry, and which come from location, contracts or people?
5. Collect proof of use. Invoices, packaging, advertising, distributor agreements: anything dated showing the mark in trade.
6. Choose and defend a method. Record the assumptions, the limitations and what would change the answer.

Steps two and three are ours. A professional clearance search covers what free tools cannot, including logo and near-miss conflicts.

What can you check yourself, and what can you not?

A great deal. Our free Nepal trademark search covers over 71,500 marks published in the Department of Industry's Industrial Property Bulletin.

You can also see what else an owner has filed. The owner and applicant search lists every published mark under a name, which helps when a portfolio is described loosely.

What you cannot do online is confirm registration status. Those marks are published, which is a stage in the process, not proof a certificate issued.

Nepal has no public status portal either, so the last step is a file check at the Department of Industry rather than a search. Plan for it in the timetable.

What does this look like for one business?

Picture a Kathmandu tea company with a mark registered in Class 30 for packaged tea, now opening tea houses. This is an illustration, not a real case.

Most revenue is packaged tea, so the Class 30 registration carries it. The income model attaches to something the register actually supports.

The tea houses are a different question. Restaurant services usually sit in Class 43, and no application exists in that class.

So a valuer credits the planned outlets cautiously, or not at all, and flags the gap. One filing fixes it; the class finder is where to start.

Our note on protecting a coffee or tea brand sets out the classes these businesses usually need.

What happens to value as the term runs down?

A registration lasts seven years under Sec. 18D and is renewable in further seven-year terms without limit under Sec. 23B.

Renewal is filed within 35 days of expiry, with a six-month late window on payment of a fine, after which it is cancelled automatically.

A buyer looking at a mark weeks from expiry sees a task, not just an asset. Our renewal calculator maps the dates.

Keeping it current is administrative, not difficult. Our renewal service tracks the term in every class you hold.

Common mistakes

• Treating advertising spend as value. Money spent proves effort, not that customers now choose you because of the name.
• Crediting the mark with all the profit. Location, staff, contracts and price all earn part of it. The valuer's job is to separate them.
• Quoting a multiple from another market. Ratios from a different country and legal system are not evidence about your brand.
• Calling a pending application a registration. Title arrives on registration under Sec. 16; ® before then is not accurate.
• Leaving the owner name unmatched. A certificate naming a founder while a company sells is fixed before a deal, not during one.

In short

Valuing a trademark is an evidence exercise before a financial one. Cost, market and income answer different questions, and the legal file decides how much weight any of them can carry.

In Nepal what matters is registration under Sec. 16, the right classes under Sec. 18A, a current term, real evidence of use, and the Sec. 21D transfer route that makes the mark saleable.

Get the figure from a qualified valuer. Get the legal file in order first, because that part you can fix yourself.

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If a sale, a licence or an investor conversation is coming, the useful first move is a register review — contact our team and we will tell you what the record shows about your mark before a valuer opens a spreadsheet.