Intellectual property can be a crucial business tool, although not everyone thinks hard enough about protecting their big ideas. In 2001, plumber Brad McCarthy got stuck on a remote beach in Cape York in north Queensland and spent about 6 hours getting his car out with a hand winch. He knew there must be a much better way. In response, he invented Maxtrax, a light-weight vehicle-recovery device for bogged off-roaders.
After designing the super-tough nylon product, he attended a Queensland Government business seminar, where the advisers stressed getting patent protection before his idea was publicised. “One of the primary things we did was speak to a patent attorney to see the way we could protect the idea,” says McCarthy, who launched Maxtrax in 2005. It is actually now sold in about 30 countries worldwide. McCarthy has Inventhelp Corporate Headquarters in key markets such as Australia, Europe and the US, and also the business also has a trademark on the distinctive original “safety orange” hue it uses of its moulded product. Unlike McCarthy, however, many inventors and businesses with a great idea cruel their odds of success from day one.
Their big mistake? Ignoring patents or any other intellectual property protection before they spruik their idea to investors, people or even friends. It can be a costly error. Bradley Postma, principal at patent and trademark attorney firm Cullens, says small, and medium enterprises (SMEs), particularly, often neglect safeguarding their IP or think it will probably be too costly. “The vast majority of protectable IP goes unprotected,” he says.
Europe can be a particular trap for exporters because, unlike various other major markets, it lacks a grace period permitting public disclosure of an invention without affecting the validity of a subsequent patent application. That opens just how for the idea or product to be copied. “In Australia and america you can make a move about it, provided you’re within a one-year window – in Europe you can’t, it’s too late,” Postma says. “In that case, businesses have shot themselves in the foot; they’ve forfeited their rights and anyone can copy [their idea].” Postma observes that business owners often think their idea is too simple to warrant a patent. “However, if it’s successful and straightforward, it will be copied and you have to get advice.”
Unitary patents on way – Margot Fröhlinger is principal director of unitary patent, European and international legal affairs on the Munich-based European Patent Office (EPO), which oversees about 160,000 patent applications a year. She recently completed a road trip warning Australian businesses that poor patent and IP safeguards could derail their European market opportunities. Companies have to innovate – and protect their inventions. “You need the protection of your IP and, in particular, patent protection in order to obtain a good return on your investment,” she says.
Many international businesses have baulked at exporting to Europe due to complex patent processes across multiple jurisdictions that can lead to potentially high costs and marginal protection. However, the EPO is promoting a new unitary patent system that promises to be a game changer. This makes it easy to get protection in as much as 26 participating European Union member states using the submission of any single request to the EPO.
A November 2017 EPO study, Inventhelp Prototype, Trade and FDI within the European Union, suggests better harmonisation of Europe’s patent system has the potential to increase trade and foreign direct investment in high-tech sectors, delivering annual gains of €14.6 billion ($A22.8 billion) in trade and €1.8 billion (A$2.81 billion) in foreign direct investment.
Fröhlinger believes Australian businesses across all sectors have possibilities to expand into the European market, which boasts more than 500 million people, high gross domestic product and strong consumer demand. “It’s extremely important for Australian businesses to understand that there exists a big change ahead in Europe. I’m not talking just about patents,” Fröhlinger says. “It’s extremely important to get an integrated IP portfolio considering patents and trademarks and (covering) design. Should they don’t have (IP) folks-house they ought to try to get strategic business advice.”
The value of intangible assets – This call to action for Australian businesses comes as the worldwide Innovation Index 2017 reports on countries’ IP receipts as a amount of total trade. In essence, the measure indicates the way a country has been doing on the IP front. While Australia scores well when it comes to inputs into research and development, the united states (5.1 per cent), Japan (4.7 per cent) and Finland (2.9 per cent) easily outperform Australia (.3 percent) on IP royalties.
Your message? As a general rule, Australian companies usually are not great at converting research into value and treat IP nearly as an administrative function. The exceptions are health tech leaders, like medical device company Cochlear and sleep-disorder business ResMed, which understand the value of intangible assets such as logo and data use, and build their businesses around it.
In a knowledge-based economy, IP has developed into a crucial business tool and governing it is not just dependent on organising trademarks and Inventhelp Success Stories. Intangible assets are rapidly increasingly important than tangible assets and require appropriate consideration.
Overview of Australia’s top listed companies, released by Glasshouse Advisory in September 2017, endorses this kind of sentiment. It reveals that 38 % from the companies’ value (regarding a$550 billion) will not be included on the jjnywy sheets; this suggests that investors are operating without insights right into a significant proportion from the corporate asset base.