InBus_Win09_56-96:InBusiness 1-61 11/12/2009 10:45 Page 69
Intellectual Property | SPECIAL REPORT
A new property
EMERGES
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InBusiness looks at what needs to be done to develop
sufficient intellectual property strategies if we are to achieve
a thriving knowledge driven economy.
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A HEAVY FOCUS on the property and
“FOR IRELAND TO MAKE ANY
a move towards more distributed R&D,
manufacturing industries has led to a level of whereby large companies have small R&D
inertia when it comes to developing Ireland’s SIGNIFICANT MOVE UP THE centres in many parts of the world, allowing
‘Smart Economy’. While there has been, what
VALUE CHAIN, INVESTMENT
them to be close to customers, informed by
seems on the face of it, significant investment in local trends, and to take advantage of
R&D in Ireland over a number of years, when IN COMMERCIALISATION AND distributed talent. This is surely a model that
the figures are compared in percentages of
INTELLECTUAL PROPERTY
Ireland can embrace.
GDP, it looks as though driving innovation has Ireland also has a favourable tax and legal
been the poor cousin of the Celtic Tiger. (IP) MUST GO HAND-IN- environment for IP. The R&D tax credit regime
It seems that the importance of developing
HAND WITH INVESTMENT
– whereby a business can obtain a tax credit of
the Smart Economy was often underestimated 25 per cent on qualifying R&D activities –
during the boom times and simply throwing IN R&D.” coupled with the standard 12.5 per cent tax
money at research has not been enough to rate, is a very attractive proposition for
build an economy capable of long-term are beginning to realise the value of IP, many companies thinking of using Ireland as an IP in-
sustainability. The saying goes ‘Research turns businesspeople admit to being confused about licensing centre. Firms can also avail of a patent
money into knowledge, innovation turns the associated costs. Though this has posed a royalty exemption regime whereby income
knowledge into money’ – unfortunately, too significant barrier to companies here, it is slowly derived from a qualifying patent will be tax
much time and energy has been spent on the being overcome. exempt in the hands of a company in certain
first half of this particular dictum. A lack of A detailed strategy will identify what IP the circumstances. An exemption from stamp duty
predefined goals from the outset of what was company has (brands, know-how, customer is also available on the disposal of
hoped to be a knowledge driven economy details, software, processes, patents, etc.) and intellectual property.
allowed universities to happily accept additional identify the value of all these pieces to the The tax system is complimented by the
research money with little or no conditions business. A good strategy usually means a positive legislative system in place here. All of
attached; nor were there any stringent distributed portfolio of IP which is well managed the core legislation in relation to the protection
requirements for the commercialisation of and cost effective. Companies should only file of patents, etc., has been enacted in Ireland in
research, up until recently that is. Now, patents when they can see an increase in sales the last 20 years and ‘the Copyright and related
universities are becoming increasingly aware of or market share. It is also important to recognise acts of 2000’ is widely regarded as one of the
their role in developing their links with industry, that IP is an asset and appears on the most advanced pieces of legislation in Europe.
commercialising research and developing company’s bottom line. The advent of the Commercial Court in 2004
entrepreneur programs. This is the starting has also had a major impact in selling Ireland as
point, but for Ireland to make any significant KNOWLEDGE DEVELOPMENT a centre for IP management and offers a
move up the value chain, investment in While the immediate focus should remain on significant advantage over competitor countries.
commercialisation and intellectual property (IP) building indigenous IP rich companies, further It must be remembered however, that
must go hand-in-hand with investment in R&D. investment in the Smart Economy can make securing R&D is a highly competitive business
Ireland an attractive proposition as a central IP and other jurisdictions offer compelling
FORMAL STRATEGY licensing centre. In fact, many companies, alternatives. However, the lack of restrictive tax
However, before that can happen, companies formerly of the ‘not invented here’ mindset – legislation and the presence of one of the most
here need to understand the importance of meaning that they only trusted their own admired legislative structures in Europe, as well
putting in place an Intellectual Property strategy. research and development processes – now as the absence of transfer price legislation, puts
Secondly, setting out that IP strategy is clearly embrace a new ‘proudly found elsewhere’ Ireland in pole position in the race to attract
defined detail is critical. While businesses here process of technology acquisition. There is also high-value companies.
InBusiness Winter 09 69
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