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 six hours getting his car out with a hand winch. He knew there has to be a better way. In response, he invented Maxtrax, a lightweight 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 talk to Inventhelp Prototype Services to find out the way we could protect the concept,” says McCarthy, who launched Maxtrax in 2005. It is actually now purchased in about 30 countries worldwide. McCarthy has patents in key markets including Australia, Europe and the US, as well as the business also 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 a great idea cruel their chances of success from day one.
Their big mistake? Ignoring patents or some other intellectual property protection before they spruik their idea to investors, the general public or even friends. It can become a costly error. Bradley Postma, principal at patent and trademark attorney firm Cullens, says small, and medium enterprises (SMEs), specifically, often neglect safeguarding their IP or think it will likely be expensive. “The vast majority of protectable IP goes unprotected,” he says.
Europe can be considered a particular trap for exporters because, unlike various other major markets, it does not have a grace period allowing for public disclosure of an invention without affecting the validity of a subsequent patent application. That opens the way for an idea or product to be copied. “In Australia and the United States you can take action regarding it, provided you’re inside 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 people often think their idea is just too very easy to warrant a patent. “However, if it’s successful and straightforward, it will probably 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 in the Munich-based European Patent Office (EPO), which oversees about 160,000 patent applications per year. She recently completed a road trip warning Australian companies that poor patent and IP safeguards could derail their European market opportunities. Companies have to innovate – and protect their inventions. “You require the protection of your own IP and, in particular, Inventhelp Inventor Service in order to get a good return on your investment,” she says.
Many international businesses have baulked at exporting to Europe as a result of complex patent processes across multiple jurisdictions that can result in potentially high costs and marginal protection. However, the EPO is promoting a new unitary patent system that promises to become a game changer. This makes it possible to get protection in as much as 26 participating European Union member states with the submission of a single request towards the EPO.
A November 2017 EPO study, Patents, Trade and FDI within the European Union, suggests better harmonisation of Europe’s patent system has got 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 opportunities 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 exists a big change ahead in Europe. I’m not talking only about patents,” Fröhlinger says. “It’s extremely important with an integrated IP portfolio considering patents and trademarks and (covering) design. If they don’t have (IP) folks-house they should attempt to get strategic business advice.”
The price of intangible assets – This call to action for Australian businesses comes as the international Innovation Index 2017 reports on countries’ IP receipts as being a portion of total trade. Essentially, the measure indicates just how a country has been doing on the IP front. While Australia scores well when it comes to inputs into research and development, the US (5.1 percent), Japan (4.7 %) and Finland (2.9 percent) easily outperform Australia (.3 per cent) on IP royalties.
The message? As being 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 significance of intangible assets such as logo and data use, and make their briaac around it.
In a knowledge-based economy, IP has turned into a crucial business tool and governing it is no longer just a point of organising trademarks and Inventhelp Caveman Commercial. Intangible assets are rapidly more and more important than tangible assets and require appropriate consideration.
A review of Australia’s top listed companies, released by Glasshouse Advisory in September 2017, endorses this kind of sentiment. It reveals that 38 per cent in the companies’ value (in regards to a$550 billion) is not really included on their own balance sheets; this means that that investors are operating without insights right into a significant proportion from the corporate asset base.