Six Principles of Smart Protection of Intellectual Property
The need to protect intellectual property rights is faced by any company, which sells its goods and services under its own brand.
Registration of a trademark is perhaps one of the simplest procedures for protecting intellectual property. It is well known that a trademark is intended to individualise goods or services and represents an image in the form of a sign accompanied with the list of goods/services. To register a trademark, it would be enough to submit an application to the patent authority of the country where the sales are planned. The obtained registration will be valid as long as its holder needs it to be. The only condition is that the holder should pay for its prolongation every ten years. Nevertheless, the application may be turned down: for example, if a similar trademark, which a buyer cannot distinguish fr om the new one is already registered in the country. In this case, there are various ways of how to act: one can make changes in the originally submitted list of goods and services, submit a new image for the trademark or undergo identification procedures offered by regional patent authorities. Each of these cases requires an individual approach.
The work with other types of intellectual property needs larger resources. For industrial companies, whose products include original engineering solutions, they are inventions and utility models. Patenting enables manufacturers to protect their designs, which secure competitive advantages for their products, as it is extremely imprudent to introduce products in the market without their engineering solutions being patented. Competitors are up to every move: they will surely notice a high quality product, copy and patent it. After such unfair rivals obtain the patent, they can even prohibit the original manufacturer fr om selling the products with their stolen engineering solutions.
Consequently, protection of intellectual property is strategic for a modern business. Hereafter, I will give several practical recommendations regarding intelligent intellectual property management:
1. To protect the intellectual rights of a business in the domestic market and to defend yourself against unfair importers, you should obtain a certificate for your trademark or patents for your inventions and have them registered with the Customs Register of Ukraine. It will help prevent import of infringing products, which copy your designs. We managed to test the efficiency of this mechanism first-hand: when a Chinese company tried to export a consignment of equipment to Ukraine, which fully copied Corum’s patented equipment model, we received a notice from customs and the goods were blocked on the border. We filed a claim, which was finally sustained. The court ruled that the illegally imported equipment should be destroyed.
2. To accelerate the process and to secure high quality protection of an engineering solution, you can submit every engineering solution with regard to both the utility model and the invention. It is a little more expensive, but it gives certain advantages: you can obtain a patent for your utility model faster, acquire the exclusive rights to allow and prohibit its use and have it registered with the Customs Register of Ukraine at once. Record process with regard to an invention application in Ukraine takes eighteen months to three years; after that, we obtain an expert report on the conformity of the engineering solution to the protectability criteria, such as the feature of novelty and the inventive level, or on the conformity to neither criterion. If there is no feature of novelty, we know for sure that the obtained patent for the utility model is within the risk zone and should only be valid until we have developed a new engineering solution instead.
We think that our Company’s products, whose design is developed for years and which require heavy financial expenses, should be protected by means of reliable patents. Therefore, the first reliability level is formed by our Department for Intellectual Property Management, when they prepare applications and search for prototypes, while the second one is formed by the expert body of the Ukrainian Intellectual Property Institute (Ukrpatent) or the Patent Cooperation Treaty.
3. Both the trademark certificate and the patent for an invention / utility model / industrial model are of a regional character, which means that they are only valid in the country, wh ere they were received or registered. Therefore, before penetrating a foreign market, make sure that your company’s rights for all intellectual property you are interested in should be secured in accordance with the local laws: engineering solutions, such as inventions and utility models; artistic solutions (interior), such as industrial models; means of individualisation, such as trademarks and branded names etc. For example, our Company had registered the Corum trademark in our target markets, i.e. in Poland, Vietnam, China, Russia, Belarus and Kazakhstan.
4. When introducing your products to foreign markets, you should submit your patent application according to the procedure under the Patent Cooperation Treaty (РСТ). In such a way, you will save on the time and money required to register intellectual property rights in various countries.
The advantage of the procedure under the PCT is that the submission of an application to Ukrpatent is automatically spread to all regional field-specific agencies of the countries that signed the Patent Cooperation Treaty (there are over 140 of them). The applicant gets an opportunity to take a decision, within thirty months, in which the country he needs to obtain a patent. At the same time, your engineering solution will be protected in that country from the moment when the documents under the PCT will be submitted to Ukrpatent. The international searching body will make a search among the submitted applications and will provide the applicant with its report on the conformity of the submitted engineering solutions to the protectability criteria. Then the applicant should decide in which country and when, within these thirty months, he will submit an application for his utility model or invention. The application should be accompanied with the report of the international searching body on its conformity to the protectability criteria. The period for obtaining foreign patents is three or more years.
Products should be protected by patents in all international markets, wh ere the company’s products are exported.
5. You should think of engaging an employee in charge of your intellectual property or of establishing a separate subdivision, depending on the scope and the specific character of your business.
How can a company arrange an efficient operation in the intellectual property sphere? The first thing that comes to mind is to enjoy the services of specialised firms and agencies. This is what Corum did in the beginning. It turned out that an outsourcer is really able to give consultations and render services in court proceedings related to intellectual property. But to create a constant stream of applications for new designs, a company needs to have an internal professional designer (or a professional pharmacist, or a professional farmer, in the respective economic sectors). And this person should not necessarily be a lawyer. Such a specialist can get a second education in the sphere of intellectual property on the basis of his first education. In our Group, intellectual property is one of the instruments of creating competitive products; in this view, its management process covers the following objectives:
• control over risks of violation of intellectual property rights of third parties (in the process of new product development, modification and improvement of commercial equipment, equipment repair, manufacture of spare parts and introduction of products in the new markets);
• receipt of legal protection in the territory of Ukraine and abroad for the results of intellectual activities obtained by our own resources;
• protection of the Company’s intellectual property in the territory of Ukraine and abroad (registration with the Customs Register, judicial proceedings);
• search for patented results of intellectual activities, which would be promising for the Company, including the results of intellectual activities of competitors, to buy patents, for instance;
• gain of additional profits from the process of intellectual property management: for instance, commercialisation due to the issuance of licences (i.e. leasing of titles) for the use of our patents to third parties and remuneration for it (royalties).
In Corum, these objectives are implemented by the Department for Intellectual Property Management. Besides, we have developed the Regulations on intellectual property management to deal with inventions, utility models, industrial models, as well as a document to motivate our designers to come up with new inventions.
6. And finally, conclude agreements with authors of inventions for transferring their rights for obtaining patents to their employer.
With regard to employee inventions, our laws stipulate equal ownership of the property rights by the author of the intellectual property and its employer. If there is no agreement for transferring part of the author’s intellectual property rights, the employer will not be able to manage it independently. According to this agreement, the employer should pay the author remuneration for the transfer of intellectual property rights and for the possibility of the subsequent use of patents at the employer’s own discretion. As a rule, the author readily agrees to conclude such an agreement, as, first, the company pays him remuneration for the use of the patent, and, second, he cannot prepare the application by himself and the specialists’ assistance costs a lot.
Innovation is a recipe for success in the modern world. As Albert Einstein said, “the definition of insanity is doing the same thing over and over again, but expecting different results”. Inventions help businesses become more efficient, and intelligent intellectual property management helps businesses become more profitable.
Andrey Afinogenov, Director for Legal Support, Corum Group