Transcript TAIEX Conference on Intellectual Property Rights for Small and Medium-Sized Enterprises Istanbul, Turkey 10-11 January 2005

TAIEX
Conference on Intellectual Property Rights
for Small and Medium-Sized Enterprises
Istanbul, Turkey
10-11 January 2005
Using the IPR System
for Enhancing the
Competitiveness
of SMEs
Cherine Rahmy
Counsellor, SMEs Division, WIPO
Topics
1. About WIPO
2. Intellectual Property in Today’s Economy
3. What are Intellectual Property Rights?
4. IP Rights and Competitiveness
1. About WIPO
• International organization - One of 16
specialized agencies of the United Nations
• Dedicated to promoting the effective
protection and use of Intellectual Property
(works of the human spirit)
• HQ in Geneva, Switzerland
• 180 Members States
• Administers 23 international treaties on
different aspects of IP protection
About WIPO
• Goal: Progressive development of
international IP Law
• Goal: Integrate IP in national development
policies
• Goal: Enhance accessibility and
affordability of global IP protection systems
• Goal: Promote an IP culture
Creation
• In October 2000, WIPO established the
SMEs Division
• WHY FOCUS ON IP FOR SMES?
– Worldwide: more than 90% of enterprises in all
economies are SMEs
– EU 19 million SMEs, representing 99,8% of all
EU enterprises, employing more than 74
million people
– These enterprises are a source of
employment, innovation, entrepreneurship
and growth
Why Focus on IP for SMEs
• SMEs largely under-utilize the IP system as
many studies show due to:
– Lack of awareness of the IP system and its
usefulness
– Perceived high costs and complexity
– Lack of easily accessible assistance
2.
Intellectual Property in
Today’s Economy
Some figures …
• Since 1993, patent applications at
the European Patent Office have
increased by 8.3% a year.
• Companies such as IBM,
Motorola, Philips, Mitsubishi,
Canon, Hitachi, Kodak apply for
over 1000 patents a year.
• IBM earns over US$ 1 billion a year from
patent licensing revenues.
• US Patent License Royalties (in billions
US$):
$120
$100
$80
$60
$40
$20
$0
1980
2002
• Over 80% of the market value of Microsoft
derives from its intangible assets, especially
its intellectual property.
• The value of the Coca-Cola trademark
exceeds US$ 50 billion.
• The previous figures show that the IP System is
one of the cornerstones in the knowledge-based
society of this millennium.
• Therefore, understanding the legal and economic
foundations of the IP System is a prerequisite for
comprehending its increasing importance in
national strategies for enhancing competitiveness
of enterprises.
Dr. Horst Fischer, Corporate Vice
President, Siemens AG
“Any company wishing to prosper in the next
millennium will also have to
efficiently manage its IP portfolio”.
“For this reason it has become essential that
every manager in the enterprise - not just
those working in the corporate legal
department - appreciates and understands
not only what IP is, but how it can be more
effectively exploited."
Why have IP rights
become so important?
• Intangible assets as main source of competitive
advantage for firms (knowledge economy)
• Outsourcing of manufacturing by large enterprises
• Legislative changes (national, regional and
international)
• Expansion of patentable subject matter (e.g.
biotechnology)
• Universities and public research institutions have
entered the patenting game
3.
What Are IP Rights?
Its main branches
• Industrial Property Rights
–
–
–
–
–
Patents
Utility Models (or “short-term patents”)
Trademarks
Industrial Designs
Geographical Indications
• Copyright and Related Rights
Patents
• Definition: A patent is an exclusive legal right granted
for an invention that is:
– New
– Involves and inventive step (non-obvious)
– Is capable of industrial application
•
•
•
•
•
Duration: 20 years from filing date
Territorial right
Requires disclosure of the invention
Can be licensed to third parties
Utility Models (or short-term patent): up to 10 years
Patents
• Why do European SMEs apply for patent
protection?
–
–
–
–
–
–
–
–
–
Market exclusivity
To recover R&D investments
Facilitates licensing
Advantageous negotiating tool
Financing opportunities (venture capitalists, etc.)
Favorable image and credibility
Freedom to operate
Higher market value and publicity
International expansion
Case study on
patent protection
• Case study on the commercialization of a patented
product
– Croatian pharmaceutical company (Pliva) discovers new
antibiotic (azythromycin)
– Pliva applies for patent protection in Croatia and in
various potential export markets
– Large pharmaceutical multinational Pfizer searches
patent databases and discovers the Pliva patent
– Pliva licenses Pfizer to produce the antibiotic in the US
as well as in some other countries in Western Europe
while Pliva maintains the exclusive right to
commercialize the antibiotic in Eastern Europe
Trademarks
• Trademarks:
– A sign capable of distinguishing the goods (or services) produced
(or provided) by one enterprise from those of others
– Crucial to differentiate products from those of competitors
– Basic pillar of any marketing strategy
– Important for enhancing recognition and reputation of the
product and for creating a loyal clientele
• Trademark registration:
– Provides exclusive right to prevent others from making identical
or similar products under the same or a confusingly similar mark
– Duration: 10 years. Can be renewed indefinitely.
Case study on trademark
protection
• An Italian businessman buys unmarked t-shirts from
manufacturers of generic clothing, attaches his trademark and
begins to sell them to retail stores.
• Started in a garage in the periphery of Rome.
• Today the Pickwick trademark is perceived by Italian teenagers as
a synonym of style and quality.
• Pickwick has exports its products across Europe.
• Its trademark is its most valuable asset.
Geographical Indications
• Geographical indications:
– Sign used on goods that have a specific
geographical origin and possess qualities or a
reputation that are due to that place of origin
– Examples: champagne, roquefort, tequila, chianti.
– Most commonly, a geographical indication consists
of the name of the place of origin of the goods.
Industrial Designs
• Industrial Designs
– Aesthetic features of a product
– Must be new, original and have an individual character
– Adds value to the product by making it more appealing to
consumers.
– Enables customization of products to specific markets or target
groups (e.g. women, children, etc.)
• Design protection
– Provides exclusive rights to prevent others from making, offering,
importing or selling any product in which the design is incorporated
– Duration: in the European Union up to 25 years (unregistered
design: 3 years).
Case Study on industrial
design protection
• Trax® is a system of public seating manufactured
by OMK Design Ltd.
• Originally designed for British Rail. Had to be
visually appealing, comfortable, weather-resistant
and resistant to vandalism.
• In 1990 it was installed in railway stations in UK.
• 14 years later it is installed in over 60 airports.
• Industrial design protection in UK, France,
Germany, Italy, Benelux, Australia and the US has
guaranteed a degree of exclusivity keeping imitators
away.
Copyright
• Rights given to creators for their literary and
artistic works
• Protected works: books; newspapers; computer
programs; databases; films, musical compositions;
choreography; paintings; drawings; photographs;
sculpture; architecture; advertisements; maps and
technical drawings.
• Generally protected for 70 years after the death of
the author
• Does not require registration (however…)
Case Study on copyright
protection
• Uruguayan software developer Memory®: accounting
programs for SMEs
• Global presence
• Copyright belongs to company
• Registered its software in the different countries in which
it operates
• Each copy of the Memory Software includes a license for
use with copyright notice
• Technological protection measures
• Permanent innovation (only to “legitimate customers”)
4.
IP and Competitiveness
What are the factors that determine
the success of a new product
in the marketplace?
•
•
•
•
•
•
•
The product provides functional advantages
Price
Attractive design
Reputation of brand
Available in the main retail shops
Consistent product quality
After-sales services
• If functional improvements, attractive
designs and a well-positioned brand are
some of the features that may determine the
success of a new product, what can an SME
do to protect them and maintain its
exclusivity over their use?
Legal protection of IP
grants exclusive rights
• Innovation - improvement
of functional aspects or
fabrication process of the
product
Patents, Utility Models
• Design - the product’s
appearance
Industrial Designs
• Brand - commercialization /
marketing of the product
Trademarks, GI
Example 1
• Patent for the fountain pen
that could store ink
• Utility Model for the grip and
pippette for injection of ink
• Industrial Design: smart
design with the grip in the
shape of an arrow
• Trademark: provided on the
product and the packaging to
distinguish it from other pens
Source: Japanese Patent Office
Example 2
• Invention of CD player
protected by patent
• Brand on CD player
protected by trademark
• Design of CD player
protected by industrial
design
• Music played on CD player
protected by copyright
SMEs and Global Economy
• In the new knowledge economy, intangible
assets, including innovative ideas, information
and know-how have become central business
assets.
• In the US, SMEs contribute 2.38 times more
innovations per employee than do larger firms
(Source: OECD)
• SMEs are proven innovators in the broad sense
SME Competitiveness
• In the new knowledge economy competitiveness is
increasingly based on firms’ ability to provide
high-value-added products and services at a
competitive price.
• Globalization and trade liberalization has made it
crucial for SMEs to become internationally
competitive even when competing exclusively in
domestic markets.
SME Competitiveness
• In order to be internationally competitive SMEs need
to constantly improve their efficiency, reduce
production costs and enhance the reputation of their
products by:
–
–
–
–
–
Investing in research and development
Acquiring new technology
Improving management practices
Developing creative and appealing designs
Marketing their products and services
SME Competitiveness
• The above requires SMEs to make significant
investments.
• Without intellectual property protection there is a
strong risk that investments in R&D, product
differentiation and marketing will be wasteful.
• Intellectual property enables SMEs to have exclusivity
over the exploitation of their innovative products, their
creative designs and their brands, thus creating an
appropriate incentive for investing in improving their
international competitiveness.
Conclusion
By establishing a culture of identifying,
cultivating and strategically using its IP assets,
an enterprise can increase its revenue,
have an edge over its competitors
and position itself well in the market.
Welcome to visit WIPO’s website for SMEs :
http://www.wipo.int/sme
Thank You!