What is intellectual property?
Intellectual property (IP) refers to creations such as inventions, literary and artistic works, designs and symbols, as well as the names and images used by businesses.
- it is important for businesses that their intellectual property is protected, through Intellectual Property Rights (IPRs)
- IPRs protect inventors, creators and businesses from others wrongly profiting from their creations or inventions
- IPRs give businesses an opportunity to earn back the money they have invested in developing a product or their companies reputation - when a company’s ideas, brands or products are pirated and counterfeited, it reduces a firm’s opportunities to grow and to employ people
- IPRs offer guarantees to consumers, through trademarks and geographical indications that identify the origin of the creation and can act as quality indicators
- counterfeit products can put citizens' safety or health at risk, for instance where vehicle spare parts or medicines are concerned
IPRs offer your business legal protections.
Here are the main Intellectual Property Rights
Patents protect an invention or a technical product or process. It is unlawful for others to make, use, resell, rent out, or supply the patented object or process. However, the patent holder may give others permission to do so by granting a patent licence. Patent licensing is an agreement between a patent owner and someone who wants to use the patent. It usually requires a payment from the person who takes the licence.
Copyright protects works of literature, scholarship, science and art. These include books and articles, films, paintings, music, games, photographs and software. It is important for businesses to remember that copyright exists automatically. This means there is no need to register or apply for it. For instance, anyone who makes a drawing automatically owns the copyright to it.
Neighbouring or related rights
In addition to copyright, there are ‘neighbouring rights’ that are sometimes known as ‘related rights’. Neighbouring rights are public performance royalties due to the playing of sound recordings of a copyright holder in public. Every song has two basic types of copyright attached to it: one for the composition of the song, and one for the recording of the song. The composition copyright pays the songwriter and publisher, while the sound recording copyright pays the artist that recorded the song and record label. Like copyright, these rights arise automatically.
Your business can use a trademark to distinguish your products or services from your competitors’ products and services. Trademark rights protect the names of products or services. They also protect a product’s logo and the design of its packaging. Your business must register your trademark if you want to protect it.
Design rights protect the appearance of two- or three-dimensional products. These include wallpaper patterns, textiles and the design of household items such as alarm clocks, toys and chairs. The design must be new and original. To obtain such protection, a design must, in principle, first be registered. In some case however, design are automatically protected in the EU without prior registration.
A geographical indication (GI) is a sign used on products that have a specific geographical origin and possess qualities or a reputation that are due to that origin.
For example, Darjeeling tea. In the region in which the Darjeeling geographical indication is protected, producers of Darjeeling tea can forbid the use of the term “Darjeeling” for tea not grown in their tea gardens or not produced according to the standards set out in the code of practice for the geographical indication.
Geographical indications are typically used for agricultural products, foodstuffs, wine and spirit drinks, handicrafts, and industrial products. A GI sign must identify a product as originating in a given place. More information can be found here.
Plant breeders’ rights
Plant breeders can invoke plant breeders’ rights to protect their new plant varieties (In order to qualify for these exclusive rights, a variety must be new, distinct, uniform and stable). These new varieties frequently result from long and costly breeding processes.
Plant breeders’ rights give the breeder exclusive control over the propagating material (which includes seeds, plant cuttings and divisions, and plant tissue culture) and harvested material (which includes cut flowers, fruit, and foliage) of a new variety for a number of years.
With these rights, the breeder can choose to become the exclusive marketer of the variety, or to license the variety to others.
Many countries have plant breeders’ rights through membership of the International Convention for the Protection of New Varieties of Plants and the WTO’s Trade-Related Aspects of Intellectual Property Rights Agreement.
Databases consisting of collections of ordered data may be protected by database rights. For a business, building up such a database often requires a considerable investment of time and money. An owner has the right to object to the copying of substantial parts of their database.
Businesses and IPRs in a nutshell
Whatever your business makes or the service it provides, you are likely to be using and creating intellectual property.
- most businesses have a trade name or one or more trademarks and they should consider protecting them
- almost all businesses have valuable confidential business information, such as customer databases or sales strategies that they may wish to protect
- many businesses also develop creative original designs, or invent or improve products or services - businesses can also produce and distribute copyrighted work
Your business should consider how best to use the IP system to your own benefit.
- Your business should consider what is required for protecting, managing and enforcing your intellectual property and trade secrets, to get the best possible commercial results from your assets
- Some businesses might consider the registration of IP rights to be expensive, in particular if they are a small business
- But remember, certain IP rights can be enjoyed without any formal procedure and without paying any official fees - this is the case for copyright and for unregistered designs
It is possible that your business is using intellectual property that belongs to others.
- In such situations, you could buy it or acquire the right to use it by taking a licence - this will avoid you facing a dispute and consequent expensive litigation
You can read more about the benefits of IPRs here.
How to enforce your IPR
If you think your IP rights have been compromised you should consider seeking expert, possibly legal advice.
- you might be advised to send a formal letter – known as a cease and desist letter – to the alleged infringer of your IPRs
- this should inform them of the possible existence of a conflict between the IP rights of your company and their business activity - it should identify the exact conflict and could also suggest a possible solution to the problem
- if the infringer is unintentionally violating your rights, a cease and desist letter could stop the breach, or allow you to negotiate a licensing agreement, without going to the courts
- for intentional violations of IPRs, such as counterfeiting and piracy, you may be advised to seek assistance of law enforcement authorities
If you consider it in your interests to avoid court proceedings, there are also alternative dispute mechanisms including arbitration and mediation that you could consider.
What is the link between trade and IPR?
Businesses today no longer just ship goods to foreign countries. Innovation, creativity and branding add a much larger amount to the value of their trade than before. Your firm’s knowledge of new technology, ideas, methods and techniques is an important asset.
By protecting business ideas with effective intellectual property rights, governments encourage business innovation and creativity because it can grow your business and create jobs.
Many EU companies do business abroad. As their intellectual property becomes increasingly important in international trade, the differences in the levels of protection and enforcement of IPRs around the world can create tensions.
Countries that have a lot of intellectual property abroad try to defend their domestic business interests by asking other governments to deliver effective rules or enforcement of IPR rules in their countries.
Agreeing to new trade rules for intellectual property rights is an important way to introduce more security and predictability, and also to settle IPR-related disputes abroad more systematically.
There are several IPR agreements internationally including
- the World Trade Organisation and its Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs). The TRIPs Agreement sets minimum standards of IPR protection that each country should provide, and establishes procedures for the settlement of IPR-related disputes. The IPRs that the TRIPS agreement covers include
- copyright and related rights
- trademarks including service marks
- geographical indications including appellations of origin
- industrial designs
- patents including the protection of new varieties of plant
- layout designs of integrated circuits
- undisclosed information including trade secrets and test data
- the World Intellectual Property Organisation (WIPO)
- WIPO is a UN agency offering intellectual property (IP) services, policy, information and cooperation, which seeks to develop a balanced and effective international IP system that enables innovation and creativity for the benefit of all
- You can find more information about WIPO international IPR treaties and read its Guide about setting up IPR services
- other resources on international IPR organisations
- the World Customs Organisation: The protection of IP rights
- United Nations Conference on Trade and Development (UNCTAD): Intellectual Property Programme
- Interpol: Intellectual property crime and counterfeiting
- Organisation for Economic Co-operation and Development: Project on counterfeiting and privacy
- business initiatives - React and BASCAP