Trade marks are information carriers through which direct contact between buyers and sellers is obtained and maintained. In today’s consumer society, which is overburdened with increasingly subtle and artificial product differentiation, most purchasing decisions would be difficult without any feedback mechanism between the products on offer and potential consumers. Accordingly, producers need a symbol that is capable of providing this feedback by conveying the relevant information about the products to consumers, without boring or over-educating them. On the other hand, consumers need a symbol to guide their choice and express their preferences. To convey this information in an effective manner there must be a clear link with the producer, or at least the commercial entity responsible for marketing the product. The most convenient and effective way of establishing this link would be through the product’s trade mark. Nonetheless, modern business and marketing practices are increasingly driving a change in the role of trade marks from consumer protection tools to investment protection tools. This significant change has created a deep tension at the heart of trade mark law and has hindered attempts to formulate a coherent body of law. Accordingly, this thesis examines the causes of this tension by evaluating the current European trade marks protection system and its contributions towards promoting free competition and enhancing social and economic welfare. In addition, this thesis tests the developing national and Community trade mark decisions against economic arguments to judge how these decisions are responding to and dealing with the tension within the law. Moreover, the thesis explores how the law can avoid the problem of over or under protection by establishing a balance between protection of and access to trade marks rights. To achieve this goal the responsible authorities must resolve the fundamental challenges of ‘what do we want to protect in a trade mark?’ and leading on from this, ‘what is the scope of an efficient system of trade marks protection?’ Furthermore, this thesis considers how the trade marks system should deal with the wider economic functions of trade marks and their implications for the specific topics of dilution, comparative advertising and parallel importation. Finally, the thesis concludes by calling for the creation of a balanced trade mark protection system through the application of the legal and economic tools indentified throughout this study.