In Australia, intellectual property is an important asset that distinguishes your business from your competitors. In this article, we address the common questions that local Australian businesses may ask about intellectual property:
- What is Intellectual property?
- Why is Intellectual property important?
- What are the types of Intellectual Property?
- What should you consider about Intellectual Property?
What is intellectual property?
Intellectual Property is an asset. Unlike a car or furniture, intellectual property is intangible and cannot be touched. This is known as an intangible asset. There is no clear definition on intellectual property. However, intellectual property do share common characteristics, and those characteristics include:
- intangible value; and
- independent intellectual effort.
Some simple examples include:
- your logo;
- your business name;
- your design;
- your recipe.
Why intellectual property is important?
When building an asset protection strategy for your business, and developing your business for the long term, some issues on intellectual property, are:
- which part of your business involves or relies upon intellectual property;
- how to protect your intellectual property; and
- how to maximise your intellectual property to give you the best outcome.
What are the types of Intellectual Property?
The commonly recognised categories of IP are:
What is a Trade Mark?
A “trade mark” is a mark, i.e. a sign, that represents your trade, i.e. your business. A trade mark shows your distinct branding to distinguish your goods or services from those of another.
In Australia, you can register a trade mark with “IP Australia”. IP Australia which is the authority vested with powers under the Trade Marks Act 1995 (Cth). While registration is not necessary to claim rights over your brand, it certainly helps and ensures your brand’s protection is available for all to see and much easier to enforce if someone tries to misuse it.
What is Copyright?
Copyright is a legal right, that cannot be registered in any database unlike trade marks but is able to be protected.
Generally, copyright arises automatically for:
- works (including literary, dramatical, musical and artistic works); and
- other subject matters (including film, sound recording, broadcast or published editions).
For example, if you are the author of a published book, copyright of the literary work within that book almost always arises.
What is a Patent?
A patent is a legal right to a patentable invention that is disclosed to the public. Generally, for a patent to be obtained for a manufactured product or idea, the product or idea:
- should be a ‘manner of manufacture’, that is, something that provides a material advantage in a field of economic endeavour;
- be novel;
- involve an inventive step;
- useful; and
- not be secretly used.
Registration of a patent is a complex process and, in Australia, can provide protection for between 8 and 25 years depending on the type of patent.
If you think you have a patentable product or idea, you should be very careful with whom you share it and what obligations they have to you when they do. If you don’t have the right protections in place and someone else decides to copy your work, there’s little you can do.
What is Confidential Information?
Confidential information cannot be registered but is recognised at law. It also encompasses some of the other forms of IP, such as the details of a patent application are inherently confidential.
Generally, information takes a confidential character when:
- the information has the necessary quality of confidence;
- the circumstances surrounding the information creates a duty of confidence; and
- the person who acquires that information.
Therefore, part of your business planning should involve making sure any employees are aware of their confidentiality obligations to the business.
What should you consider about Intellectual Property?
In addition to the above most prominent examples, you can register a design for a product packaging and for a new type of plant bred by you. There are also rights known as moral rights arising for those that created the intellectual property, whether it’s owned officially by them or not.
So now that you know IP is more than just a catchphrase used by smart people to describe their ideas, and that you have your own, what should you do?
When planning a new business, have a think about which part/s of your business might be considered intellectual property. If you have any doubts, research, and consider whether seeking legal advice is necessary to help you organise, plan and position your business’s intellectual assets.
Obtain advice as to an appropriate business structure that will protect your IP assets from the risks of trading.
If you’re buying someone else’s business, you should make sure you’re buying as many of their IP assets as possible and ensuring they commit not to use that IP moving forward.