The trademark contract between Renault Samsung Motors and Samsung will end on Aug. 4, according to an audit report recently released by the motor company.
Renault Samsung Motors said on April 19 that it will begin a two-year grace period unless it extends the trademark contract by two years. In August 2000, Renault signed a contract to use Samsung Group's trademark with Samsung Electronics and Samsung C&T.
Under the contract, Renault Samsung Motors uses Samsung's trademark but pays a certain percentage of the product's sales in the year before-tax operating profit occurs. It was reported that the ratio was about 0.8 percent.
Both sides have been signing contracts on a 10-year basis and are allowed to have a "grace period," meaning a two-year grace period after the contract is terminated, Renault Samsung explained.
The two sides agreed to extend the contract in June 2009, more than a year before it was terminated. Under the agreement, Samsung Card will retain its 19.9 percent stake in Renault Samsung and maintain its trademark "Samsung."
Renault Samsung has been preparing for a breakup since several years ago by changing the color of its store signboards from blue to yellow, which symbolizes Renault.
Once the trademark contract is terminated, Renault Samsung's company name will naturally be changed to "Renault Korea," and the name and logo of the car are likely to be used in the global market as Renault.
Renault Samsung Motors was established in 2000 when Renault Group acquired Samsung Motors. Renault Group BV, a Dutch subsidiary of Renault Group, and Samsung Card signed a joint investment contract.
Renault Samsung Motors saw its sales drop 16.5 percent to 4.6 trillion won (some $3.8 billion) and its operating profit decline 40.4% to 211.2 billion won ($173.1 million) last year from a year earlier.
