Business development · 1 July 2019

Intellectual property for SMEs

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Intellectual property rights allow the owner to buy, sell and license their IP. However, it’s important to get this protected early as it will form a major part of a business’s assets. The key to this is effective planning and management.

Why you need this as part of your business plan

The value of Intellectual property could outweigh tangible assets. It can even be worth millions of pounds in some cases. If another person or business replicates or infringes your rights as an owner, you can bring a civil action against them as you will be protected under IP law.

Copyright

Copyright
SME owners must remain aware of copyright law.

This grants the owner exclusive control over their creative works. It protects literature, art, music, dramatic works, software, film and TV broadcasts amongst others.

Copyright law protects the ‘expression’ of a work. There must have been some skill, labour or judgment in the creation of the work, and it must be original. A copyright is also an automatic right in the UK. This means, as soon as a piece of qualifying work is created, it is protected by copyright.

There are no formal processes involved, unlike other intellectual property rights.

Some businesses commission a third party to create works for them, so it is important to ensure there is an agreement in place which stipulates who owns the copyright prior to the work being created.

Failing to do so could result in the copyright being owned by a third-party creator, such as a website designer, which may end up limiting how a business may use or exploit the work.

Trademarks

relationships
Have you thought about trademarks?

This form of legal protection is a key component of a business’s brand. It helps to distinguish the good and services from one business to another. A trademark can be a word, logo, a combination of both, a shape, colour, and sound.

They can be used as marketing tools in order for customers to recognise the good and services offered by a particular business.

Trademarks can be registered or unregistered in the UK, however, registered Marks offer their owners greater protections. The Intellectual Property Office (IPO) is the body in the UK which registers trademarks. The process can be summarised in three stages:

1. Application of the intended trademark (with the relevant classes and descriptions of good and services the business offers)

2. Acceptance of the application and publication (the intended trademark is published in an online journal for two months)

3. Registration of the trademark (provided there are no objection to the application by other trademark owners. The publication period may be extended for a further one month)

Trademarks carry protection for ten years and can be renewed every ten years. Not all trademarks can be registered especially if they are deemed to be too descriptive (in respect to the goods and services offered); they are customary in your line of trade; they include a specially protected emblem; they are deemed offensive to the public, or they deceive the consumer.

Registering your trademark has many advantages for a business. It will deter others from using your trademark without your permission and if they do you can take legal action against them.

Counterfeiters using your trademark could also be investigated and criminal charges brought against them by Trading Standards Officers or the Police. You can also sell, franchise or license your trademark for more commercial gain.

Patents

This safeguard protects inventions and allows you to take legal action against anyone who uses, sells or imports the invention without your permission.

A patent can only be applied for if you create something which is inventive, new and useful.

You can not patent literary, dramatic, musical or artistic works, ideas are also not patentable.

Applications for a patent in the UK are made to the IPO and the process can sometimes take several years before the patent is granted. Once granted the patent gives 20 years of protection, provided the patent is renewed and the fees are paid.

Given the time and costs involved in obtaining a patent, businesses should think carefully about whether one is needed and what the benefit is for the business.

Designs

registered design
Have you protected your brand design?

There are two types of design protection; registered design (which goes through the IPO in the UK); and unregistered design right. Design registration protects the appearance or ‘the look’ of a product or design, as long as it is new and has an individual character.

The difference between a design right and a patent is that the design right protects the visual aspect of a product whereas a patent protects the technical and functioning aspects of a product.

Applications for registering a design will require images of the product.

There are exceptions to registering a design. For example, you can not register any immoral or illegal designs or designs containing a protected emblem. The registration process generally takes around 4 weeks, providing the design meets the eligibility criteria.

Unregistered design rights are automatic, however, they offer limited protection and enforcing the right is difficult.

Disputes

Advice on the best steps to take to prevent further infringement does not necessarily result in huge legal bills but may prove to be more cost and time effective. There are also alternatives to going to court with mediation available for parties to settle their disputes.

Businesses should research their options carefully and realise that there is the potential of IP to enhance existing revenue streams or to create new ones. Consider the possibility of licensing or franchising for example. Future planning is about how to use IP to its maximum benefit for business development.

Summary

When considering IP protection, you should seek advice from a lawyer specialising in intellectual property. It’s better to take advice on what your requirements will be, and which protection is best suited for your needs.

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ABOUT THE EXPERT

Karen Holden is an award-winning solicitor and founder of A City Law Firm (ACLF), the go-to lawyers for entrepreneurs, startups, scale-ups, those seeking investment. In addition to being very successful lawyers for businesses , ICOs and family law, ACLF are now the UK's leading LGBT law firm and surrogacy specialists. Karen is a regular media commentator, panellist and event speaker.

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