Intellectual property is a catch-all term to describe the rights arising from the intangible assets that define your business branding and your innovative ideas. The rights the business owner or creator holds to such assets require protection, they fall into four broad categories: copyright, patents, trademarks, and design rights. Intellectual property rights are extremely valuable and should be robustly protected from the inception of the business.
Whilst each division of intellectual property relates to a separate right there are occasions where it almost appears to overlap. For example, an individual's name cannot be copyrighted therefore if an entrepreneur wishes to trade under their own name, as frequently happens in dress design and particularly with haute couture, you must register a trademark to protect the name.
Also, there can be overlap between patents and design rights, design rights protect the unique appearance or features of the innovation but not the function of the item, which should be patented to protect this aspect. In 2013 the government introduced Patent Box, in keeping with a number of other countries, this is a scheme aimed at incentivising businesses to keep their intellectual property within the UK. The scheme, administered by HMRC reduces corporation tax to 10% on the profits generated from IP income.
Khizar Arif, a partner, points out "anyone starting a new business should give considerable thought to all aspects of intellectual property (IP) related to the protection of the rights and revenue generated in this connection, from the name by which your company which will distinguish it from other similar businesses to licensing your IP. Thinking ahead to the potential expansion of the business, the name of the business should reflect any potential changes or expansion of the products or services you may embark on in the future. For example, if you start a business manufacturing mattresses and bed bases you may, in the future, wish to expand into dressing tables, wardrobes and bedroom related soft furnishings, in that case, therefore, Bedrooms 4 U may be better than Beds 4 U as a trading name," Khizar also remarked "whilst in the industry sectors where it is usual to trade under the business owner's name, there can be a considerable disadvantage to this, in that if the business fails or is sold as a result of financial problems you will lose the right to use your own name for any future enterprises and others will benefit from your name and reputation."
A number of prominent designers have found to their cost that, following a business failure, they can no longer use their famous names in a new enterprise. Paolo Gucci and Karen Millen failed to regain the right to trade using their own names. However, Elizabeth Emanuel, the designer of the Princess of Wales wedding dress, has recently experienced a partial success having recently regained the ability to trade using her name following an extremely long legal fight resulting in a settlement with the current owner of the trademark, whereby she can use the name Elizabeth Emanual to sell clothes designed by her to TK Maxx.
It is advisable to seek the advice of specialist lawyers with in-depth knowledge of intellectual property law to advise on avoiding any inadvertent breaches of the law relating to intellectual property. Giambrone & Partners' highly experienced corporate and commercial lawyers can assist in avoiding the pitfalls surrounding intellectual property.
A start-up business or an entrepreneur planning to exploit a new innovation that is entirely theirs must be absolutely sure that no element of your novel invention belongs to a third party or that your proposed business name has already been registered. You can search the government office Trade Marks - Intellectual Property or the Intellectual Property Office can also assist.
If your business strategy involves developing new innovations or designs in order to licence your unique discoveries to third parties or as in the music industry, your compositions are exploited by other parties, you will need to ensure that you and not others, benefit from your creations in the shape of extremely comprehensive licensing agreements that leaves no opportunity for plagiarism or claims that amendments made by the licensee entitles them to your royalties.
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.