Intellectual property can be a crucial business tool, but 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 six 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 Invention Help Companies, he attended a Queensland Government business seminar, where advisers stressed getting patent protection before his idea was publicised. “Among the first things we did was talk with a patent attorney to view how you could protect the concept,” says McCarthy, who launched Maxtrax in 2005. It really is now purchased in about 30 countries worldwide. McCarthy has patents in key markets including Australia, Europe as well as the US, and the business even offers a trademark on the distinctive original “safety orange” hue it ways to use its moulded product. Unlike McCarthy, however, many inventors and businesses with recommended cruel their chances of success from the first day.
Their big mistake? Ignoring patents or some other intellectual property protection before they spruik their idea to investors, the public or perhaps friends. It could 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 likely be too costly. “The majority of protectable IP goes unprotected,” he says.
Europe could be a particular trap for exporters because, unlike a few other major markets, it does not have a grace period making it possible for public disclosure of an invention without affecting the validity of any subsequent patent application. That opens the way in which for the idea or product to become copied. “In Australia and the United States that can be done something regarding it, provided you’re inside a one-year window – in Europe you can’t, it’s far too late,” Postma says. “In that case, businesses have shot themselves inside the foot; they’ve forfeited their rights and anyone can copy [their idea].” Postma observes that company owners often think their idea is just too very easy to warrant a patent. “However, if it’s successful and uncomplicated, it will probably be copied and you need to get advice.”
Unitary patents on way – Margot Fröhlinger is principal director of unitary patent, European and international legal affairs in 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 need to innovate – and protect their inventions. “You need the protection of your own IP and, particularly, patent protection to acquire an excellent return on the investment,” she says.
Many international businesses have baulked at exporting to Europe due to Inventhelp Intromark across multiple jurisdictions that can lead to potentially high costs and marginal protection. However, the EPO is promoting a whole new unitary patent system that promises as a game changer. This will make it easy to get protection in up to 26 participating European Union member states with the submission of a single request for the EPO.
A November 2017 EPO study, Patents, Trade and FDI inside the European Union, suggests better harmonisation of Europe’s patent system provides the possibility 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 to the European market, which boasts more than 500 million people, high gross domestic product and robust consumer demand. “It’s extremely important for Australian businesses to understand that there is a big change ahead in Europe. I’m not talking no more than patents,” Fröhlinger says. “It’s extremely important to have an integrated IP portfolio considering patents and trademarks and (covering) design. If they don’t have (IP) individuals-house they should attempt to get strategic business advice.”
The need for intangible assets – This call to action for Australian businesses may come as the worldwide Innovation Index 2017 reports on countries’ IP receipts as being a percentage of total trade. In essence, the measure indicates the way a country has been doing on the IP front. While Australia scores well in terms of inputs into research and development, the US (5.1 %), Japan (4.7 percent) and Finland (2.9 percent) easily outperform Australia (.3 %) on IP royalties.
The message? As a general rule, Australian companies usually are not good at converting research into value and treat IP nearly as an administrative function. The exceptions are health tech leaders, including medical device company Cochlear and sleep-disorder business ResMed, which understand the value of intangible assets like brand and data use, and wksgqs their businesses around it.
In a knowledge-based economy, Inventhelp Pittsburgh has developed into a crucial business tool and governing it is not only a matter of organising trademarks and patents. Intangible assets are rapidly becoming more important than tangible assets and require appropriate consideration.
Overview of Australia’s top listed companies, released by Glasshouse Advisory in September 2017, endorses such a sentiment. It reveals that 38 per cent in the companies’ value (in regards to a$550 billion) is not included on their own balance sheets; this suggests that investors are operating without insights into a significant proportion in the corporate asset base.