With the results of Brexit, now may be a good time to your IP portfolio in order to ensure your business is properly protected and is making the most of its intellectual property (IP) going forward. Laura Trapnell and Abigail Sinden of Paris Smith LLP's Intellectual Property Team help you focus on how to do this.

What is intellectual property?

IP is one of your business's most valuable assets and is frequently estimated to represent more than 75% of your business value.

IP commonly falls into two categories:

  • 'hard' IP which is recognised by statute and which covers trademarks, patents, copyright, designs and data; and
  • 'soft' IP which is not protected bu statute but which is nonetheless recognised under common law and which covers goodwill, confidential information, know-how and trade secrets.

The IP which underpins your business's brand, reputation, products and services should be developed, protected, exploited and defended as part of your continuing IP strategy.

Preparing and operating a comprehensive IP strategy will ensure that your IP is protected and will build value for your business in the future.

IP audit

In order to establish what IP your business holds, it is vital that your IP professional undertakes an IP audit. The purpose of the IP audit is to allow you to identify your key IP assets and make sure that you are using them in a way which generates value for your business. The audit will help you to become aware of how you can use your IP to generate income; for exampple, there may be opportunities to license your design or franchise your brand. A good IP audit should also make you aware of all of the risks, by telling you where your IP is potentially exposed and how to manage these risks in future. This is not just about potential infringement, or lack of protection, but making sure internal IP management strategies, such as the documentation and codification of know-how align with the commercial and financial plans of the business.

IP strategy

Having completed your IP audit, a good IP strategist will help you create a comprehensive IP strategy. Your IP professional should see your vision to enable them to spot strategic opportunities.

IP strategy and legal protection of your IP assets will depend on a number of factorssuch as the nature of the asset, how it will be exploited, the territories in which it will be sold, the shelf life of the competitive advantage and so on.

In essence a good IP strategy will consist of the following elements:

Develop

You already have a commercial plan for the next three years of the business - where you want to position the business, new product/service growth and financial budgets. From this, your IP professional can help you forecast protection strategies for emerging or growing products/services and identify where such protection requires registration of IP assets and consideration of international territories. You should also be thinking about appropriate tax reliefs and if you are generating new IP, then R&D tax credits should be an important part of your tax planning.

Exploit

IP does not always have to be top secret or confidential, in fact sometimes it is beneficial to let others use your IP in a regulated and controlled way. A solid IP strategy and portfolio will consider how income can be generated for your business whilst helping you lock out competitors and maintain market leadership. This can be achieved by way of strategic distribution, licensing, joint venture, research and development or data sharing agreements.

Defend

Part of having a comprehensive understanding of your portfolio is benchmarking competitors, recognising infringements and being prepared to defend the IP which has taken you considerable time and money to create. You do not want competitors using your data, trading off your reputation or developing a product which is too similar to your design or patent which will dilute your turnover. But IP litigation is expensive, despite the introduction of specialist IP courts. Including an IP budget which accounts for both protection costs and litigation costs, should be an important part of your financial planning.

Preparing and operating a comprehensive IP strategy will ensure that your IP is protected and will build value for your business in the future.