When calculating the value of a business, it is simple enough to put a figure on the physical assets you hold – the buildings, furniture, IT equipment and stock, for instance.
However, many small and medium-sized businesses neglect to protect the value of their ideas or inventions, which are often where the real value lies. For, without protection of these ‘assets’, your business may be at risk from rivals or copycats. Equally, if you have control of them, you can use them to gain financial reward.
All firms, regardless of their size, will have something intangible that marks them out – it’s what makes the business tick. These intangible assets, or Intellectual Property (IP), are crucial to the competitiveness of your business and, if you do not protect them, your business could be at risk.
IP includes a range of issues, including the name of your business, its logo, the website content, your designs, staff knowledge and skills, inventions or methods and systems.
Another area to consider is contract-based IP, which sets out how IP generated in collaborations or in deals with large partners is owned or licensed. Indeed, if your IP is stolen, your business may fail as this is what generates its income.
Copyright
Copyright covers the expression of an idea, not the idea itself. One area where copyright is often confused is in the design of a business website. While you might think you own the website, you may only be partly correct in this assumption.
You may have paid to own the domain name but if you sought an external firm to build the site it may be that the designer still owns the design and the words on the site. This will remain the case unless you agree that all copyright is transferred to your company.
Any written material or ideas you create in-house will be protected by your own copyright. However, if for example you invent a new car braking system, you can copyright your drawings for the system, but you’re not protected for the actual braking system itself unless you file a patent application for the innovation you
have created.
Patents
In order to obtain a patent you must prove you are protecting a technological innovation. There is no clear definition of an ‘invention’ by the UK Intellectual Property Office (UK IPO) but a technological innovation is, put simply, something new that your business has created that moves technology forward in a new way.
The innovation must also have an industrial use.
You can’t easily gain a worldwide patent; you must apply in each individual territory in which you will be doing business or use the Patent Co-operation Treaty. In the UK the first step is to contact the UK IPO to register your idea and the processes involved in creating it. You can either do this yourself, or employ a patent lawyer to ensure you are fully protected. Another point to remember is if you ever make your idea public, such as contenders on Dragons’ Den, you lose the right to win a patent on it.
Trademarks
The use of a trademark by a business can be an important part of their branding and marketing activities. A trademark can consist of a logo, image, picture or text. A business can trademark a phrase, wording on a logo, the shape or colour of a logo, or even a human movement. For example, the pat on the back pocket used in Asda’s advertising has been trademarked. Music can be trademarked too, such as the Direct Line jingle.
To register a trademark it must be original and unique from any other trademark that is currently in use. But before claiming your trademark, you must select from 45 different business categories in which you operate. If, for example, you run
a television production company, you will have to find which of the 45 categories you operate in, and register the trademark in that area. There may of course be several categories, in which case you will have to register – and pay – for each. Protecting IP
A good place to start when looking to protect your Intellectual Property is the UK IPO’s website. It is full of guides and advice, but your business should also conduct its own IP audit as you are best placed to know what makes your business special.
Protecting your IP allows you to manage how it is used and who uses it. But the type of protection you need will depend on what you are protecting and how you will use it. If you only operate in the UK then you may only require UK protection.
However, if you could do business overseas, it’s worth researching the countries in question on the World Intellectual Property Organization website. The good news is that, even if cheap knock-offs are produced in China, they cannot be imported into the territories in which your business has protection.
Designs
You can protect the look of your product if its appearance is in some way unique. The iPhone, Dyson vacuum cleaners and even the appearance of pages on some websites such as eBay are protected. Your designs are unique to your company and can often be the difference between a customer selecting your product or a rival one.
If the look of your product is what attracts at least some of your sales then not protecting that look against copycat designs would be foolish.
While your design has some protection for up to 12 months from its launch, without having to apply for protection, the UK IPO recommends registering for a five-year design protection. This can then be renewed for a maximum term of 25 years.
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