Intellectual Property - intellectual property laws allow business people to protect their creative and innovative small business idea in a formal legal way, similar to that of physical property. Intellectual property is a valuable asset which can create business returns and is a legally protected concept. Business owners must register their ideas in order to gain intellectual property rights. These must be granted and defined in writing to be enforceable in law. There are four main types of intellectual property (IP):-
Patents - The primary purpose of the patent is to stop other people using the invention and passing it off as their own. The patent rights are set out in the Patents Act 1977, as amended by the Patents Regulations 2000 (SI 2000/2037) and the Patents Act (PA) 2004. Patents allow inventors to publish and protect the findings of an invention. In return, the State agrees that the inventor has a monopoly on the invention for a set time period. The patents system provides inventors of a legal mechanism to make public their small business idea for the benefit of others. The monopoly period provides the inventor the breathing space they need to achieve financial returns from their invention. The time period is usually 20 years and therefore the patent should have been utilised by investors during the lifetime of the invention over that period.
There are limits to what type of invention can be patented. For example:-
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Inventions must be new and have not been publicly advertised in any way before the patient filing date;
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It must involve an 'inventive step' that would not be obvious to someone with a good working background knowledge of the subject concerned;
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The invention must be applicable to industry. In other words, it must take some kind of practical application in business such as a product, industrial process or operation, i.e refer to something that is not purely intellectual;
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Inventions must not paid be contradictory to the established physical laws of mathematics such as new discoveries, theories or mathematical models.
To apply for a patent, the first step is to ensure that anybody you speak to regarding the invention, has to sign a confidentiality agreement, otherwise the invention is considered "published" in the eyes of the law. Alternatively, if the patent application has been filed before any commercial discussions commence, then you are more likely to be supported by the law. A Chartered Patent agent abides by codes of conduct of confidentiality, and is a good starting point. The patent office will provide searches of the technical literature related to the subject of the invention and to make sure that there is an 'inventive step' And that the invention as a 'novelty'. There are also searches of any possible infringement. It is a long and drawn-out process to apply for a Patent, which can take up to two years or more. It involves comprehensive form filling from the Patent office and is best left to a qualified Patent agent. The application must be accompanied by a specification which includes a detailed description of the invention and a definition of its scope. If the patent goes from the Preliminary Stage through to the Substantive Examination, a Patent Examiner may lay down certain objections and provide an opportunity for the applicant to amend their application. If the patent is finally approved, a formal notice will appear in the Official Journal and a patent certificate provided.
There are various methods of making money from patents. By licensing a patent you can keep the title and rights of the patent itself while selling a licence to market or manufacture the product by a third party. To ensure a sensible financial return an investment, a performance clause is usually inserted into the contractual agreement, stipulating a minimum number of sale units over a fixed time period. Secondly, by selling the Patent to a company or other individual, it is possible to achieve a large financial sum. This is normally via a business angel or a experienced competitor with market knowledge in the chosen area. Thirdly, it is possible to the sell the rights and title of the patent to a third party for a lump sum and also achieve a royalty payment for each unit sold in future.
Many business people will need to protect their invention from copycats from overseas markets. To do this, they may need to register their patent in a slightly different way. The Patent Co-operation Treaty (PCT) aims to provide a simplified and less costly method of preserving the rights to file a patent application in 123 member participating countries. It seeks to achieve this by providing what is known as a PCT application. The treaty provides this single application process, search process across all countries. The system is managed by the World Intellectual Property Organisation (WIPO).
Trademarks - in any increasingly competitive online marketplace, brand awareness through visual representation is critical. A trademark provides a business with a visual recognizable symbol upon which its goods can be identified and associated with by consumers. It might be a monogram or a logo or a signature or symbol. It can be registered in law and must therefore be distinctive and clearly different from existing registered Trademark's. Trademarks only apply to physical tangible products, as opposed to intangible services. To register a trademark you must first check with the trademarks branch of the patent office to ensure that there are no conflicting trademarks which may be already registered. The application registration form and submission must be completed, which will then be advertised in the Trademarks Journal, (to ensure there are no trade objections).
The registration period for a trademark is normally 10 years. Is a company has been using a trademark over a long period of time, but did not bother to originally register it, the law many determine that the company has acquired a "reputation" which associates the trademark with the company. By having a registered trademark, a small business has additional legal protection in the sense that it puts off competitors from copying your ideas, facilitates legal action against violators of your trademark and facilitates trading standards officers in any criminal investigation. A trademark is also an asset which you can sell on to a different business for a potentially large sum. If the trademark is associated with a strong brand with a loyal consumer base, the associated trademark also has an inherent value.
Design Registration - it is possible to register the elements of a product in terms of its shape, design, decoration or other features. These features include the colours, shape, texture, contours and materials of the product concerned. In effect, design registry protection is targeting the aesthetic aspects of the product. This type of legal protection is aimed at industrial products manufactured on mass, in supply of 50 units or more at the time. In addition, in order to qualify for registration the design must be new and have some individual characteristics which are clearly distinctive from anything that currently exists in the market. The Design Registry will check the application to see whether it is compliant with the Registered Designs Act. If compliant, the certificate of registration will provide a business the exclusive right to manufacture, use or even sell the product. This design protection applies to UK products only and will not cover imported products. Therefore, beware that a common practice for manufacturers in countries like China is to reverse engineer successful innovations, then cheaply export the copied product into the UK.
Copyright - protecting businesses ideas using copyright protection laws, provides protection against the unlicensed use of copying of original creative works. The types of works that can be copyrighted include:-
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Literary works (such as computer programs and novels, but not the actual names and titles).
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Original dramatic works
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Original music works
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Original artistic work (such as photographs or paintings)
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Sound recordings (such as CDs or DVDs).
The physical medium by which the works are sold and commercially available in is largely irrelevant. This means that your work cannot be reproduced and copied simply because it has been put on a new or different physical medium. The creation of illegal music file sharing websites across the Internet is a good example where copyright laws have been used to shut down businesses due to breaches of copyright, where the medium is the Internet. Copyright cannot protect ideas, merely the expression of the idea in a tangible piece of work. The United Kingdom copyright service offers a fee based registration and application service, where creative works can be filed and registered, (in case of future possible legal disputes). An infringement has to be more than a "substantial" part of the work that has been reproduced, without permission of its registered owner. There is no formal legal registration of copyright - therefore small business people must take legal action to claim financial damages, in order to stop other people or businesses exploiting your intellectual property.