Balancing security and growth
Patents and sustainable development
Trademarks and sustainable development
Many governments have begun implementing plans to recover from the covid-19 pandemic. Such plans often incorporate support measures relating to two key topics – namely, intellectual property and sustainability. This article discusses the connection between these topics and how their combination can lead to progressive development.
It may be difficult to see how investments in intellectual property can achieve ecologically sustainable recovery. As in the containment of the covid-19 emergency, it is necessary to avoid a Manichean contrast between the value of security and that of development and growth. One of the decisive points lies in IP rights, which have always been a key factor in the growth of societies and today, therefore, also in sustainable growth. To avoid remaining a utopia and resulting in a waste of resources, sustainable growth must make use of the tools of the market. This is because it is only thanks to such tools that it will be possible to incentivise compliance with environmental rules and select and implement the most cost-effective measures (ie, those which are economically justified in terms of their cost-benefit ratio) effectively and widely. Intellectual property enables the market, and in particular companies, to manage available resources and the externalities (positive and negative) of their economic action efficiently and according to a pro-competitive approach, thus enabling rapid and concrete responses to achieve the goal of sustainable development.
Patents and sustainable development
The above applies primarily to the much unjustly reviled patent protection. Patent protection represents the fundamental incentive to create new technical solutions that respond to felt needs and, therefore, also that of having new technologies compatible with the protection of the environment and the future of the world. Patent protection enables patentees to profit from the results of their research through the exclusive right that is conferred on them. In the presence of widespread needs such as in the context of the environment, patentees may exploit such rights through the granting of licences, even generalised ones, as typically happens for patents that become the standard of a given sector. Patent protection also ensures that the conceptual content of the invention, because it is the subject of a patent, enters the public domain from the publication of the application. This ensures a profitable circulation of information for both private and public competitors and researchers, thus fuelling competition and especially the creation of new innovations, alternatives or derivatives of the first.
Trademarks and sustainable development
Perhaps less intuitive, but equally important, is the role that trademarks can play in this regard. Trademarks are a fundamental tool for communicating with all those who interface with the products and services that they identify. In fact, the messages conveyed by brands are not limited to the suggestions and aesthetic values of fashion and design (which are highly appreciated by the public and therefore fully deserving of protection) but are much broader. They can therefore be used to make buyers recognise a product or service that has peculiar and innovative aspects – and therefore, specifically, a more sustainable product – making these aspects become an added value on the market and directing towards them the choices of buyers who want such value. It is precisely the exclusivity of their own brands that enables companies which operate in a sustainable manner to obtain visibility and therefore an economic return on their investments in this field, providing them with an incentive to produce in a more environmentally friendly way and thus putting the market and competition at the service of ecological transition.
However, it is not only the brands of manufacturing companies that can play an important role in promoting sustainability. For example, providers of environmental monitoring services or qualified and independent institutions that provide companies with evidence that they have achieved certain higher-than-legal standards in this area also play their part. By being granted certification marks and licensing them to companies that pass their controls, these subjects can push companies to improve in this regard. This is because the use of these ecological brands alongside the company brand, by showing externally the results achieved (eg, thanks to innovative and more environmentally friendly production processes), will enable them to highlight these results in the eyes of consumers. While always respecting the principle of truth, which is fundamental for all distinctive signs, the use of such ecological brands can bring concrete benefits to the competitiveness of companies.
For environmental associations, IP law expressly allows the use in a descriptive function of the trademarks of different companies to report the results (effective and verified) of their evaluations, positive or negative, on the products which bear such trademarks and their ecological compatibility and also on the truthfulness of the messages that the owner company spreads about them. In this way, companies will have an incentive to adopt procedures and create products that are as environmentally friendly as possible to avoid the negative publicity of their brands resulting from the judgment of these associations and so that they (and their products) are associated with a positive message.
In this regard, the importance of the fight against infringement can be understood. The infringer, unlike the owner of the original trademark, has no interest in guaranteeing the quality rather than the eco-sustainability of its product, since any blame will not even partially fall on it, but entirely on the trademark owner. On the contrary, such carelessness often enables the infringer to reduce production costs and increase profits at the expense of the consumer and the environment.
It is no coincidence that the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS agreement) was signed alongside the founding agreement of the World Trade Organisation (WTO). Since 1995 the WTO has guaranteed the international exchange system based on the market economy. This enabled many previously underdeveloped countries to embark on an unbelievable path of growth. The TRIPS agreement contains the minimum standard of protection of IP rights in all member countries. The basic principles of this agreement are founded on the dynamic balance between exclusivity and competition and, in this way, bind market operators to act in compliance with its principles. It prevents, for example, anti-competitive practices that lead to the formation of monopolies in which the incentive for innovation is reduced to a minimum.
The covid-19 pandemic can and must teach everyone (ie, public bodies, businesses and consumers) to better manage the resources available and rethink the values that are shared and the needs that are felt. More concretely, market operators will have to know how to anticipate demand to read the trends of a community that is rediscovering the advantages of reconciling productive needs with personal and family needs. The community is also realising the potential, for example, of smart working and databases (the importance of which is underlined by the spread of artificial intelligence, which feeds on data) in reducing "dead time" and transforming it into spaces of leisure, all the more important in an era in which the time factor is decisive.
The difficult but necessary task of companies is to guess the future that awaits them and therefore the products and services that they must equip themselves to produce and supply to capture the new demand that is already arising. The fundamental issues will be those of the reduction and better management of displacements (with the subsequent reduction of pollution) and greater attention paid to safety – in particular, that of telecoms, since it has proved itself to be equally effective and less expensive than face-to-face dialogue.
Therefore, it is important to protect intellectual property as one of the great engines of the contemporary world that enables progressive development both in strictly technological terms and from the perspective of the quality of life of the societies in which we live. It also contains the necessary means to enable the best protection of the environment, being a formidable tool of incentive and moral suasion on companies. Intellectual property is able to trigger the virtuous circle that arises from a widely perceived need that becomes innovation, which, when it is communicated and protected, produces further innovation and results in the perception of further needs (such as that of sustainability) in a path of progress that is technological, civil and human.
For further information on this topic please contact Cesare Galli at IP Law Galli by telephone (+39 02 5412 3094) or email ([email protected]). The IP Law Galli website can be accessed at www.iplawgalli.it.