Originally published in Business Today – January 2012.
The scale of so-called 'IP crime' – which includes misuse or theft of brands, technologies, designs and content– is vast. A 2009 report from The Business Action to Stop Counterfeiting & Piracy estimated that annual loss to the G20 economies from counterfeiting is around 100 billion Euros. And while most businesses know that intellectual property (IP) is important, many do not realise that having a comprehensive IP strategy can positively affect just about every aspect of a company's day-to-day business. When it comes to tackling IP, there are three key issues to consider. Firstly, understanding what you have and the value of it. Secondly, protecting it. And finally, looking at how best to enhance and monetise it.
If IP is not protected — or not protected thoroughly enough, for example in each significant country where it may be at risk — there is a real possibility that an organisation could have not just its trading and product names stolen but also its ideas and inventions.
The first step is to undertake a thorough audit of all the intangible assets in the organisation. Most people think of IP as filing patents, and perhaps registering trade marks and designs. But a company's real value is far more than that and is contained in its wider intangible assets. This includes so called 'know-how' as well as branding, skills, policies, creative works and processes. Identification of all the valuable intangible assets in a company can be done internally or by calling in outside specialists to undertake an audit and landscaping exercise.
Next, a company needs to ensure that protection is as watertight as possible. Having the right patents and trademarks in place is, of course, important. But other areas also need to be considered. For example, does any company you are thinking of investing in have employment contracts that prevent their employees taking ideas to a competitor?
Obtaining patents for innovative developments and your inventions gives you rights to stop others from making, selling, licensing, distributing or otherwise profiting from your invention for a limited period of time in exchange for a public disclosure of that invention. If an organisation is trading, or planning to trade, internationally, the issue of protecting intellectual assets across the globe can be quite intricate, particularly in this digital age. Wherever possible a company should register its IP rights in its key geographical markets. There are some simple steps that can be taken alongside professional pragmatic advice.
If an organisation has decided to trade in a particular country, it needs to try to extend protection, particularly for its goods, as soon as possible in that country. Consideration should be given to a number of routes, for example, via patents, trademarks and designs – trademarks and designs being a particularly important part of any marketing strategy. In Europe, there is the European Patenting system which can be used to provide protection across the EU States. When launching products, however, it is also important to consider distribution strategies. This is because in the EU different trade restraints apply and it is especially important to consider Competition Law which covers the free movement of goods around the EU and the avoidance of the abuse of a dominant position in the market. Recommendations for the exact route to choose will depend on the countries to be covered, the stage of development of the technology and the nature of revenue streams and cash flow.
So, finally, to commercialisation and exploitation. Coller IP has developed a commercialisation and management process that allows clients to understand the value of their intangible assets and to assess and track the commercial potential of their products and services at different stages of development. In addition, the process prompts decisions on how and whether to protect the underlying assets. A good IP advisor will not just help a business with the legal protection aspect, they will actively help in the commercialisation process of the ideas behind the goods or services that the company is selling by helping theorganisation realise the tangible value of different aspects of the IP. For anyone looking to attract funding, getting the IP in order is a must. Many venture capitalists/angel investors will be considering a range of IP factors when making their decision whether or not to invest. Knowing the value of your IP — or which parts of your IP are more valuable than others — is essential in making decisions about what parts of the business to develop, and when considering applying for funding or contemplating a sale. It is also possible to sell or license parts of your intellectual property portfolio to gain additional revenue. Putting the right IP protection in place is a vital part of the commercial strategy for a start-up or growing business and its investors.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
