Intellectual property can be quite a crucial business tool, however, not everyone thinks hard enough 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 six hours getting his car by helping cover their a hand winch. He knew there must be an improved 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 advisers stressed getting patent protection before his idea was publicised. “One of the primary things we did was talk to a patent attorney to see 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 the US, and the business even 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 good idea cruel their chances of success from day 1.
Their big mistake? Ignoring patents or other Patent Help Companies before they spruik their idea to investors, the general public as well as 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 too expensive. “The vast majority of protectable IP goes unprotected,” he says.
Europe can be a particular trap for exporters because, unlike various other major markets, it does not have a grace period permitting public disclosure of an invention without affecting the validity of a subsequent patent application. That opens the way in which to have an idea or product to become copied. “In Australia and the United States you can do something about this, 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 owners often think their idea is just too simple to warrant a patent. “However, if it’s successful and uncomplicated, it will likely 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 a 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 need the protection of the IP and, in particular, patent protection in order to get a great return on your own investment,” she says.
Many international businesses have baulked at exporting to Europe as a result of 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 as a game changer. This will make it possible to get protection in as much as 26 participating European Union member states with all the submission of the single request for the EPO.
A November 2017 EPO study, Patents, Trade and FDI in 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 chances to expand to the European market, which boasts greater than 500 million people, high gross domestic product and powerful consumer demand. “It’s extremely important for Australian businesses to comprehend that there exists a big change ahead in Europe. I’m not talking just about Inventhelp Wiki,” Fröhlinger says. “It’s extremely important with an integrated IP portfolio considering patents and trademarks and (covering) design. Should they don’t have (IP) folks-house they need to try to get strategic business advice.”
The value of intangible assets – This call to action for Australian businesses comes as the worldwide Innovation Index 2017 reports on countries’ IP receipts as being a amount of total trade. Essentially, the measure indicates just how 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 percent) and Finland (2.9 percent) 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, such as medical device company Cochlear and sleep-disorder business ResMed, which understand the value of intangible assets like brand name and data use, and build their businesses around it.
In a knowledge-based economy, IP has become a crucial business tool and governing it is no longer just a matter of organising trademarks and patents. Intangible assets are rapidly becoming more important than kxwlfd assets and require appropriate consideration.
An overview of Australia’s top listed companies, released by Inventhelp Number in September 2017, endorses this kind of sentiment. It reveals that 38 per cent in the companies’ value (about A$550 billion) is not really included on the balance sheets; this means that that investors are operating without insights right into a significant proportion from the corporate asset base.