Traditionally, trademarks were considered as convenient tools for source identification, and were granted legal recognition on this premise. However, more recently, trademarks have evolved in a new yet challenging medium as an effective tool for both corporate and social communication. The changing nature of trademarks and the subsequent emergence of modern trademark functions have prompted legal change within the European Union. Whilst this result is not in itself surprising, the approach adopted within the EU for the integration of the modern functions into the European trademark system has raised justifiable concerns on whether the balance of the trademark system has been disrupted. Given the dilemma, this thesis aimed to evaluate and critique the current system for modern trademark protection in Europe, and to propose change accordingly. To achieve this objective, the thesis used the luxury fashion industry as an analytical tool capable of reflecting accurately the various dimensions of the modern functions, particularly those aspects which are often overlooked within the legal spectrum. Only when the modern functions were fully comprehended, a proposal for a sound, balanced system for protection which takes into account the interests of all players in the market became plausible. Using an interdisciplinary approach, the thesis showed that the significance of trademarks lies within its communicative value which in turn has three dimensions; brand-consumer communication, consumer-consumer communication, and consumer-public communication. The effective protection of the modern functions necessitates the recognition of all these three facets. The thesis argued that theoretically, the protection of the brand-consumer communication dimension can be normatively justified based on a misappropriation ground through a limited, well-articulated anti-freeriding provision. In practice, Article 5(2) if interpreted in the light of the free-riding rationale suggested, can provide sufficient safeguards for the protection of brand-consumer communication. While such approach may simultaneously advance the communicative interest of some consumers (consumers of the particular brand), it falls short from protecting the broader public interest in communicating through trademarks. To fully preserve the other dimensions of trademark communicative, an effective expressive use defence which preserves the right of the public to transform, act on, criticise, resist, or challenge traditional brand meanings is crucial. Conclusively, disregarding any of these dimensions, which is regrettably the case now, will necessarily disrupt the balance of the trademark system and will simultaneously empower brand owners to manipulate consumer demand.