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Introduction to Intellectual Property

What is Intellectual Property?

Have you ever used a unique name as part of your business name? Have you created software or written a book? Have you designed jewellery or clothing? Well that’s intellectual property!

Intellectual property (IP) is defined by the World Intellectual Property Office as: creations of the mind; inventions; literary and artistic works; and symbols, names and images used in commerce.

You have probably heard of following terms – copyright, patents, designs and trade marks. These are all forms of intellectual property and you have probably used some intellectual property whilst developing your brand and business.

When do you need IP protection?

You need IP protection the moment you’ve decided you’re going to invest further into your business venture.

Some IP rights can be registered, such as trade marks, patents and designs. Other IP, such as copyright, is automatic and does not need be registered.

Why is it important?

As an IP owner, you have the exclusive right to:

  • use your IP across Australia for a period of time;
  • sell your IP;
  • license it (including franchising it);
  • Associate the idea/product/ design/brand with quality products or services; and
  • prosecute any infringers.

It also adds value to the goodwill of your business if and when you choose to sell or franchise your business.

How do I protect my IP?

How you obtain IP protection depends on what you are looking to protect and the kind of IP that can best help you protect your product or service. The following IP requires registration with IP Australia:

  • Trade marks (registration of 10 years that can be renewed at every renewal term);
  • Patents (20 years); and
  • Designs (5 years and it can be renewed for another 5 year term).

Copyright is automatic from the moment you create something and lasts during the life of the creator/author plus an additional 70 years.

IP protections gives you peace of mind to commercially market your product without infringing on someone’s IP, and allows you to exercise the rights listed above against any infringers.

The most common mistake most small businesses make is not giving enough credit to themselves and their IP at the startup phase. It is important to see IP as the groundwork for the success of your business. Quite often, small business owners believe they need to be turning over a certain amount or wait until they “make it” to register or pay attention to their IP. However, many small business owners also forget that the ‘big names’ once started off as small businesses too. The reason they became big was because they paid attention to the growth of their business, including monitoring and registering their IP as soon as possible to prevent other competitors from using products or services they had created.

Do businesses even bother with their IP?

IP filings risen in Australia and trade mark filings have increased over the last 10 years. IP Australia reported that in 2003 over 46 000 trade mark applications were filed by Australian applicants. This figure increased to just over 59 000 trade mark filings in 2012, demonstrating that securing IP is at the forefront of a business’ strategic planning. IP is also being viewed as a marketing and branding tool. As a result, business development managers, graphic designers and accountants are also highlighting the importance of their client’s IP and directing them to IP experts.

The increase in IP awareness has also come from well-known businesses, such as Apple and Samsung and more recently, Cadbury and Nestle, creating news sensations over their trade mark and patent battles. Although extreme examples, they also demonstrate the importance of the types of IP available to Small to Medium Enterprises (SMEs) and how they play a significant role in establishing brand identity.

Is it difficult to protect my IP overseas?

The surge of the Internet has meant business owners have greater access to distribution channels and partnerships that may have otherwise taken years (and expensive flights) to build. It has also meant that IP can be easily distributed and unfortunately, copied.

One of the most difficult jurisdictions that SMEs find difficult to regulate, both with registered and unregistered IP, is China. As a key market player in the manufacturing industry, SMEs are often drawn to cheap labour costs and move their production offshore. Due to an incredibly large population and difficulty in policing IP infringements, many SMEs have found it takes a staggering effort to control the infringement issues in simply the one jurisdiction. Many SMEs choose to abandon their IP rights in China for this reason.

On a positive note, some IP rights are now easier to access for SMEs due to online processes. Through a series of international agreements, some IP that can be registered in one country, such as Australia, can also be filed in other countries that have also signed to the same agreement. An example of such a right is a trade mark. A trade mark lodged in Australia can also be filed in other using the Madrid Protocol. As long as a country is a member of the Madrid Protocol, the Australian applicant can use their Australian trade mark application as a base, and lodge the same trade marks in countries such as the USA, India and Mexico. This removes the need to engage agents in other countries and lodge applications separately, saving time and money.

SMEs are encouraged to look after their IP at the outset of their business in order to maximize the commerciality of their idea/product/design/ brand. By identifying what form of IP will best protect your business, you can administer those IP rights when required, and build your brand’s association with the quality products and services you have worked so hard to achieve.