Intellectual Property Strategies In a Global Technology Market
With the onslaught of IOT, blockchain, solar cells, quantum computers, smart devices and technology in general evolving so rapidly, companies today have an enormous burden of protecting their IP on a global scale. Present day technology transcends boundaries and continents. However, intellectual property (IP) law is still territorial in nature and navigating through global IP laws is now a necessity for the continued protection of an inventor’s ideas and innovations. This article seeks to lay out the groundwork of existing global intellectual property laws, methods to ensure compliance with such laws and the best strategies to gain value and leverage IP assets to generate maximum profits for companies and small inventors alike.
Patent law is fundamentally the protection of an idea, the thought and analysis behind it, the method of creating and developing it into an ultimate product and the final design. Trademark laws protect the brand, the name associated with the product and the goodwill associated with the brand. Copyright laws protect the content such as the advertising material, websites, brochures, photographs and images of the product. Trade secrets are an element of IP law that cannot be protected via a patent, trademark or copyright but through other means of contractual law, such as non-disclosure agreements.
In order to protect an idea or concept fully, an innovator must activate all these verticals of IP law internationally. This includes applying for patent, trademark and copyright protection domestically and in foreign jurisdictions. The World Intellectual Property Organisation (WIPO) has been effective in streamlining this process. One can apply for international patent protection under the Patent Cooperation Treaty (PCT), through the European Patent Organisation (EPO) for European countries, African Regional Property Organisation (ARIPO) for African countries and global trademark protection under the Madrid Protocol or Paris Convention through the WIPO. However, there is no such thing as an international patent or trademark. Each application will be examined by the Patent and Trademark Offices (PTO’s) of the receiving state for eligibility of patent or trademark protection before it may or may not be granted in that state. In this article, I will focus on the PCT and Madrid Protocol as they are the two most commonly used routes for international IP protection.
The biggest advantage of using the PCT is the option to ‘buy more time’ to enter the national phase of patent filing. A provisional patent application cannot mature into a patent unless a non-provisional application is filed within one year of the priority date. A PCT application permits the applicant to file its non-provisional application in all the countries of his choice within 30 months (31 months in some countries) of the priority date. The advantage of filing a trademark under the Madrid Protocol for international protection as opposed to filing each application in individual countries is the cost factor. This is the least expensive method of obtaining international protection but it does come with its own challenges.
In a PCT application, the applicant is required to be a national or a resident of a member country of the PCT. The receiving office (RO) needs to be the national or resident country of such applicant. If the applicant is not a national or resident in a PCT member country, a PCT application cannot be filed. Another challenge is the ownership of the IP. The inventor is not always the applicant of a patent application. In such cases, it is always advisable that an assignment of ownership is filed by the applicant along with the PCT application to avoid ownership claims and IP disputes in other member countries. It must be noted that a PCT application itself cannot issue into a patent. Applicants are required to enter the “national phase” within 30 months (31 months in some countries) of the priority date.
The biggest challenge of an international trademark application is if the basic application is cancelled, abandoned or rejected for any reason by domestic PTO within the first five years of filing, this will result in the cancellation of all trademark applications in the designated states by the International Bureau (IB). However, the IB will inform the applicant of such cancellation and the applicant is given three (3) months to transform the international application to national ones. It is also interesting to note that several countries have submitted exceptions to the rules under the Madrid Protocol, in particular, the period of provisional refusal. According to the rules, a member state must issue a provisional refusal within twelve (12) months of the filing, however, in some countries this time limit has been extended to eighteen (18) months. Some countries also require additional “individual fees’ to be paid at a later date.
The best strategy to stay on top of these renewal dates and fee deadlines is to maintain an IP docket listing the countries of patent and trademark filings and their upcoming deadlines.
International copyright protection is relatively easier as compared to patents and trademarks. The Berne Convention for the Protection of Literary and Artistic Works requires all its member nations to protect the copyright of all persons that are nationals of any of the member states of the Convention. Therefore, a single copyright registration in a member country of the Berne Convention would ensure copyright protection in all 175 member states (as of February 2018) of the Convention.
Establishing ownership is only the first step, maintaining that ownership and protecting it from infringement is the second but a good IP strategy will ensure not only protection but will directly translate into profits. Licensing of one’s patents permits the transfer of technology to another where the patent holder retains ownership of the IP but the permission to use the technology is allowed for a predetermined fee or royalty thereby creating another source of income for the patented technology. Technology licenses may be negotiated for certain IP rights like the right to develop a software or the right to market a product. Licensing the technology to a large group of researchers or engineers will also ensure further development and innovation of the technology.
Technology transfers may include the transfer of the technology from basic research to applied research to development and then production. It may also involve the transfer of well-known technology to another company for further development thereby minimising costs of research of the previously developed technology. Technology licenses although are different from technology transfers. In a license, you can transfer the right to develop a product but you need not transfer the knowledge behind it. A technology transfer is the complete transfer of the license to use and develop the product but also the know-how behind it. Licensing is the legal platform to enable technology transfers and retain ownership. Sale of IP, on the other hand, involves the complete transfer of ownership for a predetermined fee. Whichever, the chosen route, these are a few means to generate income from one’s IP assets.
There are also other factors that influence technology licenses such as competition or antitrust laws, government regulations in each country, tax on imports and exports, etc. A comprehensive IP strategy also takes into account all these factors to ensure compliance and to monetise one’s IP assets.
Photo Credit: Nasa on Unsplash
© Kochhar & Co, 2020