Intellectual property can be a crucial business tool, however, 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 has to be an improved way. In response, he invented Maxtrax, a light-weight vehicle-recovery device for bogged off-roaders.
After designing the Reviews For Inventhelp, 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 how you could protect the concept,” says McCarthy, who launched Maxtrax in 2005. It is now purchased in about 30 countries worldwide. McCarthy has patents in key markets like Australia, Europe as well as the US, and the business also has 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 good idea cruel their likelihood of success from day one.
Their big mistake? Ignoring patents or some other intellectual property protection before they spruik their idea to investors, people or even friends. It could be 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 majority of protectable IP goes unprotected,” he says.
Europe could be a particular trap for exporters because, unlike some other major markets, it does not have a grace period allowing for public disclosure of your invention without affecting the validity of a subsequent patent application. That opens the way for the idea or product to be 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 in the foot; they’ve forfeited their rights and everyone 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 straightforward, it will probably be copied and you should get advice.”
Unitary patents on way – Margot Fröhlinger is principal director of unitary patent, European and international legal affairs at the Munich-based European Patent Office (EPO), which oversees about 160,000 patent applications per 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 have to have the protection of your IP and, specifically, patent protection to get a great return on your own investment,” she says.
Many international businesses have baulked at exporting to Europe as a result of Product Ideas 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 to be a game changer. This makes it easy to get protection in as much as 26 participating European Union member states with all the submission of the single request to the EPO.
A November 2017 EPO study, Patents, Trade and FDI in 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 opportunities to expand to the European market, which boasts greater than 500 million people, high gross domestic product and robust consumer demand. “It’s very important for Australian businesses to comprehend that you will find 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. When they don’t have (IP) people in-house they should attempt to get strategic business advice.”
The price of intangible assets – This call to action for Australian businesses may come as the Global Innovation Index 2017 reports on countries’ IP receipts being a amount of total trade. Basically, the measure indicates how 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.
The message? As a general rule, Australian companies are certainly 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 importance of intangible assets including brand and data use, and wksgqs their businesses around it.
In a knowledge-based economy, Invention Ideas has developed into a crucial business tool and governing it is no longer only a matter of organising trademarks and patents. Intangible assets are rapidly increasingly important than tangible assets and require appropriate consideration.
An 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 (in regards to a$550 billion) will not be included on their own balance sheets; this means that that investors are operating without insights into a significant proportion of the corporate asset base.