FAQ: Intellectual property

Q: What is intellectual property?

A: Intellectual property (IP) is often referred to as “creations of the mind”, and intellectual property rights help you to stop people from taking those creations without your permission. You probably have heard of most types of IP rights, and own some as well. Patents protect inventions, trade marks protect branding, design rights protect the appearance of your products, and copyrights protect your written, musical, dramatic, photographic and other creative works. You also can protect your trade secrets and other confidential information by keeping that information secret. Some types of IP rights are automatic, but you need to apply for others through a formal application processes.

Q: How do I know what IP rights my company has?

A: Companies often ask this question when they are getting ready to sell a business division, or perhaps the whole company. However, it is best to think about this early on because that is when you have the best chance of protecting your IP assets (and increasing the purchase price of your company in a future sale). You may want to conduct an IP audit to identify these assets. These audits do not need to be overly formal or expensive. You can start by speaking with your key research and development (R&D) team members to find out what IP has been created in-house versus licensed from third parties, how valuable these IP assets are, and what rights may be needed for future commercialisation plans.

Q: How can SME’s improve their intellectual property practices?

A:  There’s almost always room for improvement of IP management procedures, regardless of the size of the company. For SMEs it’s important to remember that not everything has to be overhauled at once, and incremental improvements, made regularly, can reap major rewards.

You may want to start with scheduling regular brown bag lunches where the R&D and business teams meet to discuss the developments they have made, and their commercialisation plans. If these ideas have commercial potential, then you could discuss whether it makes sense to apply for patent, trade mark and design right protection. You can also identify those ideas that are best maintained as trade secrets.

Q: What are IP licences?

A: A licence is a ‘permission’ that allows the recipient, the licensee, to do something. There are many different types of intellectual property licences, but they all have something in common. They set out the rulebook for using the licensed IP. The licence could be for patents that protect a technological invention, copyright in software code (think about all the ‘click-through’ terms you accept before downloading software!), or know-how and confidential information for a manufacturing process. It could also relate to use of a trade mark owner’s brand, and may include franchising guidelines. Almost every intangible asset that you can think of can be licensed in some form. This is good news for IP owners, as it can open up new revenue streams for assets that may have just been ‘sitting’ there. It can also be of huge benefit to licensees who, without the IP owner’s permission, would not otherwise be able to make or sell certain products or offer certain services.