Intellectual property can be quite a crucial business tool, although not everyone thinks with enough concentration about protecting their big ideas. In 2001, plumber Brad McCarthy got stuck over a remote beach in Cape York in north Queensland and spent about 6 hours getting his car by helping cover their a hand winch. He knew there has to be a 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 advisers stressed getting patent protection before his idea was publicised. “One of the first things we did was talk with a patent attorney to view how we could protect the idea,” says McCarthy, who launched Maxtrax in 2005. It is now available in about 30 countries worldwide. McCarthy has patents in key markets including Australia, Europe and also the US, and the business also offers a trademark on the distinctive original “safety orange” hue it uses for its moulded product. Unlike McCarthy, however, many inventors and businesses with a great idea cruel their likelihood of success from day one.
Their big mistake? Ignoring patents or any other Inventhelp Stories 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), in particular, often neglect safeguarding their IP or think it will probably be expensive. “The vast majority of protectable IP goes unprotected,” he says.
Europe could be a particular trap for exporters because, unlike various other major markets, it lacks a grace period allowing for public disclosure of the invention without affecting the validity of the subsequent patent application. That opens the way to have an idea or product to be copied. “In Australia and the United States that can be done something regarding it, provided you’re in a one-year window – in Europe you can’t, it’s too late,” Postma says. “In that case, businesses have shot themselves within the foot; they’ve forfeited their rights and anybody can copy [their idea].” Postma observes that company owners often think their idea is simply too simple to warrant a patent. “However, if it’s successful and simple, it will likely 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 companies that poor patent and IP safeguards could derail their European market opportunities. Companies must 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 complex patent processes across multiple jurisdictions that may result in 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 will make it easy to get protection in up to 26 participating European Union member states with the submission of the single request to the EPO.
A November 2017 EPO study, Patents, Trade and FDI inside the European Union, suggests better harmonisation of Europe’s patent system has got the possible ways 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 chances to expand in to the European market, which boasts a lot more than 500 million people, high gross domestic product and powerful consumer demand. “It’s extremely important for Australian businesses to understand that you will find a big change ahead in Europe. I’m not talking no more than Inventhelp Pittsburgh,” Fröhlinger says. “It’s very important to get an integrated IP portfolio considering patents and trademarks and (covering) design. When they don’t have (IP) people in-house they should try to get strategic business advice.”
The value of intangible assets – This call to action for Australian businesses may come as the international Innovation Index 2017 reports on countries’ IP receipts being a portion of total trade. Basically, the measure indicates the way a country has been doing on the IP front. While Australia scores well with regards to inputs into research and development, the US (5.1 per cent), Japan (4.7 per cent) and Finland (2.9 %) easily outperform Australia (.3 per cent) on IP royalties.
Your message? As a general rule, Australian companies are not great 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 importance of intangible assets including logo and data use, and make their businesses around it.
In a knowledge-based economy, IP has developed into a crucial business tool and governing it has stopped being just a matter of organising trademarks and patents. Intangible assets are rapidly more and more important than kxwlfd assets and require appropriate consideration.
A review of Australia’s top listed companies, released by Make My Invention Prototype in September 2017, endorses this type of sentiment. It reveals that 38 percent from the companies’ value (in regards to a$550 billion) will not be included on the balance sheets; this indicates that investors are operating without insights into a significant proportion from the corporate asset base.