intellectual property law 45


Intellectual property assets as a strategic business tool


Deciding whether to protect intellectual property (IP) assets – with registered legal rights, like patents for new technical inventions, trademarks for brands and logos, and designs for a product’s appearance – is an important business decision that should be considered at an early stage in a company’s lifecycle. Here, Duncan White, patent attorney at Marks & Clerk, looks at how doing so can not only provide significant barriers to entry into your market place, but also create real value in your company


Defence


Protecting revenue streams against key competitors is often the most common reason for a company to want to protect its IP. A granted patent is an exclusive right to prevent others from working a particular product or process, in a specified jurisdiction for up to 20 years, whereas a registered trademark protects a sign, symbol, or logo, again on a jurisdictional basis, indefinitely (upon renewal).


Most countries that acknowledge IP law have their own IP offices, many of which each require separate applications, so it is important to identify at the new product development stage which are the key markets both now and in the future – and where the competitors or potential infringers are most active. For example, if a product is protected in the home market, eg UK, this does not extend to overseas markets such as China.


It is important to monitor competitor activity and technology developments to help keep abreast of a changing international marketplace; the UK Intellectual Property Office has a range of helpful tools to help you search registered patents and trademarks, search ‘IP’ at www.gov.uk.


Investment and sale


Potential investors and buyers are often keen to know about the position of a company’s IP, both in terms of the financial value of that IP, but also because unprotected assets can be seen as at risk from third-party infringers. There is also a risk that if no freedom-to-operate searches (which look at other parties’ IP rights) have been undertaken, the company seeking investment or sale could actually be infringing a pre-existing IP right, and may therefore be liable for damages.


THE BUSINESS MAGAZINE – THAMES VALLEY – JULY/AUGUST 2015


Questions around IP are commonly bought up during the due-diligence process, which can delay an investment or sale if there are skeletons in the cupboard, so it is a good idea to incorporate an agreed IP strategy throughout all business functions. For example, employment and consulting contracts should clearly state ownership of any IP generated while they are employed by the company.


The importance of IP, especially registered IP rights, is the value that it creates in the company ...


Workforce education around IP is important, to ensure all employees are aware of company policies around confidential information and trade secrets; this is especially important as the public disclosure of information relating to a new technology – at a conference, for example, or through a publication – will significantly hamper efforts to prove ‘novelty’ which is one of the key attributes in being successfully granted a patent. Protection as a trade secret depends on a company’s ability to identify the information that is confidential and to demonstrate that it is treated as such within the company.


The importance of IP, especially registered IP rights, is the value that it creates in the company simply from proper identification of the company’s intellectual assets. An intelligently developed IP portfolio, in addition to having inherent value, also demonstrates that management has thought systematically about the company strategy, taking into consideration, competitive advantage, industry structure,


entry barriers, competitors, suppliers and organisation.


Commercialisation and ROI


As with tangible assets like bricks and mortar, protected IP assets can be sold and licensed once valuation and terms of use are agreed. It is important to agree IP ownership at an early stage – especially where a company collaborates with another to create IP assets – so that future strategic business decisions, especially around protecting and commercialising future revenue streams, are not impeded by earlier oversights.


The UK Government’s Patent Box initiative allows companies operating in the UK to claim a reduced rate of corporation tax on global sales of patented technology developed in the UK, allowing a company to recoup some of the expenditure involved with developing and protecting R&D activities.


While not all companies will opt for protecting their IP assets through registered rights, it is certainly something that should be discussed at an early stage.


For further information contact White, who helps clients identify, protect and exploit their IP assets, or meet our attorneys, solicitors and valuation consultants who will be presenting and exhibiting at Venturefest Oxford on July 8 (visit www.venturefestoxford.com).


Details: Duncan White 01865-397900 dwhite@marks-clerk.com www.marks-clerk.com


www.businessmag.co.uk


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