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Although the specific requirements for intellectual property rights assignments depend on the particular situation and vary from country to country, in most jurisdictions a valid IP assignment must at a minimum include the following:   

  • Identification of the Parties - identifies the contract as an intellectual property assignment agreement and identifies the Assignor and Assignee. The party transferring ("assigning") ownership interest is termed the Assignor while the party receiving it is known as the Assignee.
  • Recitals - defines the context of the assignment and provides relevant background information about the parties, including a statement of intent to transfer rights in intellectual property.
  • Definitions - clarifies relevant general and technical terms used throughout the contract in order to guarantee that these terms will have the same meaning to the parties of the agreement.
  • Assignment of intellectual property - contains a complete and concise description of the property being transferred; details exactly the intellectual property, including any relevant applications or registrations for intellectual property protection and “goodwill” (business reputation) sold with the property; “goodwill” is the intangible value of an asset, reflecting the commercial value of said asset (e.g. trade mark reputation and distinctiveness among customers). In the case of complex assignment agreements, this clause may also refer to a description of the proposed transferred assets that will be annexed to the agreement.
  • Obligations of the Parties - it is important to clearly define the obligations of the parties in order to avoid any subsequent conflict with regards to the extent of these obligations; the exact definition and extent of the parties’ obligations depend on the type of intellectual property transferred; however the main obligation of the Assignor is to transfer the ownership of the intellectual property assets and the main obligation of the Assignee is to pay the a lump sum (royalties) agreed; other obligations are those related to the Assignor’s rights to the intellectual property transferred - the guarantee that he owns the IP. 
  • Liability and warranties provisions - relates to the assignor’s right and authority to enter into such an agreement;  for example the guarantee that he is the exclusive owner of all rights, title and interest in the IP and that the IP is valid and subsisting; that the IP transferred does not infringe the rights of third parties.
  • Indemnification - a description of each party’s future obligations, if the intellectual property is found to infringe on a third party’s rights.
  • Payment provisions - price and other commercial terms.
  • Term of the agreement - identifies the effective date of the assignment.
  • Applicable law and jurisdiction - which national law will apply in the event that a conflict arises; identification of a competent court or an arbitration/mediation body to which a dispute could be referred is also important.
  • Other Common Clauses -
  • Annex - Description of the Intellectual Property
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The assignment of intellectual property rights can be made as a separate transaction of intangible assets, or it may occur as part of much larger acquisitions of assets such as sales of business assets, mergers or stock purchases. However, ownership of intangible assets is not affected by the mere acquisition of shares in a company.

To be valid and effective, an assignment of intellectual property rights should comply with specified requirements. These requirements will vary depending on the jurisdiction, national laws and regulations and will relate to the form of the assignment agreement (written agreement or not), the identification of the parties, the subject of the contract and sometimes with the obligation to declare and record the assignment within a specific register.

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The intellectual property assignment is a transfer of an owner's rights, title and interest in certain intellectual property rights. The transferring party ("assignor") transfers to the receiving party ("assignee") its property in intellectual property rights, such as patents, trademarks, industrial designs and copyrights.

The owner of the intellectual property rights may transfer all or part of his rights - e.g. the copyright owner could assign only some of his economic prerogatives. The transfer of intellectual property rights is made upon a payment of a lump sum or royalties. 

Unlike licence agreements, which grant permission to use intellectual property under certain conditions, as a general rule assignments are transfers of property rights, with no conditions under which the rights will be used.

For Trademarks: An assignment is a transfer of ownership of a trademark application or trademark registration from one entity to another.

For Patents: An assignment involves the sale and transfer of ownership of a patent by the assignor to the assignee.

For Copyright: An assignment is a transfer of the copyright owner’s economic rights. In contrast to the economic rights under copyright, moral rights cannot be sold or assigned to another person (moral rights are the right to be identified as the author of the work or to object to derogatory treatment or to a distortion or mutilation of the work, to protect the personality and reputation of authors).

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Copyright protects works such as:

- literary works- novels, song lyrics, newspaper articles;

- computer programs, some types of databases;

- dramatic works- dance or mime;

- musical works;

- artistic works- paintings, photographs, sculptures, architectural designs, technical drawings, diagrams, maps, logos;

- layouts or typographical arrangements;

- recordings of a work - recorded music performances;

- broadcasts of a work.

According to a well-established principle, copyright protection extends only to physical expressions, not to ideas, procedures, methods of operation or mathematical concepts as such.

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Copyright protection is automatic in the EU, as well as in every country that is a signatory to the Berne Convention. Copyright, therefore, arises from the moment of the work’s creation and no registration or other formality is required.

Nevertheless, copyright owners may take some measures with the purpose of informing others of the existence of copyright, reducing the likelihood of a potential infringement. A well-known measure commonly used is to mark copyrighted works with a copyright notice. Usually it includes the copyright symbol (©), followed by the owner’s name and year of the work’s protection.

Even though copyright owners do not have to register copyright, and registration is not a requirement for protection, some national laws allow it. Using these non-mandatory registration systems may prove to be useful in some situations, particularly where proof of possession and creation on a certain date is necessary to legal proceedings. It may also prevent misappropriations of information in negotiations with potential partners, since it shows that said material had already been created.

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To qualify for copyright protection, a work must:

- be original, in the sense that it is the author's own intellectual creation;

- exist in some physical form (this requirement is only applicable in some Member States as it is subject to national laws).

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Copyright is an intellectual property right, that entitles the owners of literary and artistic works to a set of exclusive rights over their works. These rights, generally, include:

- copying;

- translating;

- adapting and altering;

- communicating and performing to the public;

- distributing;

- renting and lending copies.

Copyright grants two kinds of prerogatives:

- economic rights;

- moral rights;

So-called "economic rights" enable right holders to control (license) the use of their works, and be remunerated for their use. These rights normally take the form of exclusive rights and include the right to reproduce and publish the work publicly.

The author of a copyrighted work also has the right to claim authorship, as well as the right to object to a distortion and mutilation of the work that may be detrimental to his honour or reputation. These rights are generally known as moral rights. Moral rights may include the right to decide on when or whether to make the work public, the right to claim authorship of the work and the right to object to any derogatory action in relation to the work. Moral rights are not harmonised at EU level.

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Related rights are the rights that have a specific subject matter and protect the interests of certain group of right holders, such as:

- performers;

- producers (of phonograms, films);

- broadcasting organisations;

- publishers in their editions.

These are rights granted to performers, producers and broadcasters to ensure that those who have created or invested in the creation of music, or other content such as literature or films, can determine how such a creation can be used and receive remuneration for it.

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After the period of copyright protection has expired, a work becomes available for use without permission from the copyright owner; it is said to be "in the public domain." Most works enter the public domain because their copyrights have expired. 

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Generally in the EU, copyright is owned by the natural person who creates the work. In most EU countries, the author or co-authors of a work are the first owners or co-owners of the copyright.

However, the IP systems in the EU currently vary between Member States that maintain a system of institutional ownership, and those which maintain a system of professor’s privilege (inventor ownership).

In many countries, when a work is made by an employee in the course of his/her employment, the owner of the work will be stipulated in the employee's contract, usually that the employer owns the any work created in the due course of employment.(e.g. the university would be regarded as the owner of a copyright to a work created by its researcher in the course of their employment, since the latter is paid to perform such a task).

Some countries of the EU have a specific type of "professor’s privilege" regime according to which the researchers, PhD students, etc. are entitled by law to the ownership of the work they created in the course of their employment (e.g. in Italy or Sweden). Results of publicly-funded research created or developed by researchers are thus owned by the latter and not by the academic institution where the research is carried out.

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The requirements to be satisfied for a work to be considered as jointly created (joint authorship) are generally the following:

- the work has to be produced through the process of collaboration;

- each of the authors must contribute to the making of the work;

- the respective contribution of each author is not distinct from that of the other(s).

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Copyright is essentially a private right. The copyright owner must decide how best to exploit the copyright work – to sell it, license it (exclusively or non-exclusively); an assignment transfers the full (all economic rights) or partial (some economic rights) ownership.

These options often involve contractual agreements, which may be just as important as the rights provided by copyright law.

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Registered copyright does not refer to a different type of intellectual property right, but to copyright that has been registered under the voluntary system of registration. Copyright is indeed an automatic right that does not depend on registration. Nevertheless, in some countries (e.g. Belgium), national laws allow registration of artistic/literary works. This voluntary system of registration is generally aimed at identifying the work and serving as evidence in court in litigation disputes (e.g. in order to prove more easily the date of creation of the work); it does not prove authorship.

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There are a number of exceptions in copyright law, which allow limited uses of copyright works without the permission of the copyright owner. Normally permission is not needed if using less than a substantial part of a copyright protected work.

The following list of exceptions is not exhaustive and particular care should be taken if intending to rely on an exception:

- non-commercial research and private study;

- criticism, review and reporting current events;

- teaching in educational establishments;

- helping visually impaired people;

- time shifting;

- material used in legal proceedings.

Certain exceptions require giving sufficient acknowledgment when making use of a copyright protected work.

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Copyright is infringed when a person deals with a ‘substantial part’ of a copyright-protected work without the copyright owner’s authorisation where such dealing is not covered by an exception. It is important to take into consideration that dealing with a ‘substantial part’ of a copyright-protected work does not necessarily refer to using a large amount of the work. A person who wants to exploit another person's works must obtain authorisation from the owner of the copyright-protected work; otherwise the person's act will constitute infringement of the copyright on the works.

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The Berne Convention establishes that literary works are protected under copyright, without any formal registration of rights, in the countries that agree to this Convention. This means that as soon as a literary work is created, it is considered to be protected by copyright. All European Union Member States are parties to the Berne Convention.

To obtain copyright protection on a book, authors in the EU do not need to register their publication, as protection arises automatically;  but they are required to satisfy the copyright requirements that are imposed in their country. For example, one such requirement is the original character of the work.

Copyright combines rights of the author and rights to the exploitation of works. Concerning the publication of a book, authors are usually required to assign the copyright or grant a licence to publishers in order to allow them to make copies and to distribute the work. These arrangements commonly include an agreement on the payment of royalties to the author.

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At the European level, Directive 2009/24 seeks to harmonise Member States’ legislation in the field of legal protection of computer programs by defining a minimum level of protection. Member States protect computer software as such by copyright, by analogy to the protection given to literary works within the meaning of the Berne Convention for the Protection of Literary and Artistic Works.

Copyright will protect only the computer program in the form written by a programmer i.e. its source code. Neither the functionality of a computer program, nor the programming language or the format of data files used in a computer program in order to exploit certain of its functions constitute a form of expression of that program, and thus, those are not protected by copyright.

Article 52 of the European Patent Convention excludes software from patentability to the extent that a patent application relates to a computer program as such. A distinction is, however, made between “software patents” which are excluded according to Article 52 EPC and so called computer-implemented inventions which are accepted at the European Patent Office. In this respect, “computer-implemented inventions” can be defined as inventions whose implementation involves the use of a computer, a computer network or other programmable apparatus, having one or more features realised by means of a computer program. It seems therefore that patentability must not be denied merely because a computer program is involved. You could seek patent protection if the subject matter of your invention as a whole, i.e. a machine with related software, has a technical character - this technical character must be present in all variants covered by the patent claim.

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Moral rights are perpetual. As to the economic rights, and according to the Berne Convention, which has been ratified by 167 countries including all EU Member States, the period of protection granted to the copyright owner shall be the life of the author and a certain number of years (typically 50 years) after his/her death.

However, in the case of cinematographic works, the countries of the Berne Convention may provide that the period of protection shall 50 years after the work has been made available to the public with the consent of the author, or, if it is not the case, within 50 years from the creation of such a work.

It is to be noticed that the protection period set by the Berne Convention is a minimum standard. Hence, it is up to the Member States, which are parties of the Convention, to set higher time limits for the protection of the copyright.

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In the meaning of the European Union Directive 96/9/EC on the legal protection of databases,the term database refers to a collection of independent works, data or other materials, which have been arranged in a systematic or methodical way, and have been made individually accessible by electronic or other means. In the meaning of the Directive the data or materials:

- must not be linked, or must be capable of separation without losing their informative content;

- must be organised according to specific criteria, which means that only planned collections are covered;

- must be individually accessible – mere storage of data is not covered by the term database.

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A database can be protected by copyright as a literary work and/or by a sui generis database right:

 - under the rules of international law - Berne Convention, the WTO/TRIPs Agreement and under the WIPO Copyright Treaty (WCT), original and creative databases enjoy copyright protection as literary works.

 - under Directive 96/9/EC on the legal protection of databases, which creates a specific property right for databases, that is unrelated to other forms of protection such as copyright. This new form of “sui generis” protection applies to those databases, which are not “original” in the sense of an author’s own intellectual creation (“non-original” databases), but which involved a substantial investment in their making.   

Both rights only apply to the arrangement of data – neither database copyright nor the sui generis right creates an additional protection for the individual elements of the database.

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Copyright protection applies to databases that are creative/original in the selection and/or arrangement of the contents and constitute their authors’ own intellectual creation.

Copyright protection is granted to the author and expires 70 years after the author’s death.

Copyright protection has an international character – databases are protected by copyright in almost all countries in the world. The modalities of such protection may however vary from jurisdiction to jurisdiction.

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The sui generis protection of databases applies if a substantial investment was made in obtaining, verifying and presenting its contents. A substantial investment is to be understood as a financial and/or professional investment, which may consist in the deployment of financial resources and the expending of time, effort and energy made in obtaining and collecting the contents.

The collection of data should be contained in a fixed base, which includes technical means – electronic, electromagnetic or electro-optical processes or other means – index, table of contents, plan or method of classification, to allow the retrieval of any independent material contained therein.

Database protection can apply to both electronic and non-electronic (paper) databases as well as both static and dynamic databases.

The term of protection of the sui generis right is 15 years following the database’s completion. However, if the database is published during this time, the 15-year term will start running from the publication date.

If a new substantial investment is made to an existing database (updates or supplements), the creator will have a new right to the altered database or its substantial part.

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The sui generis right grants its holder two categories of rights:

1. the right to prevent the extraction of either all or a substantial part of the database. The term “extraction” refers to the permanent or temporary transfer of the whole or a substantial part of the contents of the database to another medium, by any means or in any form. It implies that some degree of choice or individual appreciation of the content to be extracted is made.

2. the right to prevent the re-utilisation of all or a substantial part of the database. The term “re-utilisation” refers to any form of making available to the public the whole or a substantial part of the contents of the database by distributing or renting copies, through on-line or other forms of transmission.

The expression “substantial part” of the contents refers to a part that could be substantial in quantitative or qualitative terms – therefore a part may be considered substantial even if it is quantitatively small.

The sui generis right protects, as an intangible asset, the results of the financial and/or professional investment carried out towards the methodical and systematic classification of independent data. This right is not a right over the information stored in the database and does not constitute an extension of the copyright protection which may apply to the contents of the database.

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The holder of the sui generis database right is the person who undertakes the initiative of creating the database – the producer of the database – and takes the risk of investing. The investment’s substantial quality has to be proven by the producer, for example by providing invoices or information on the persons/employees involved in the work.

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What is the Uniform Domain Name Dispute Resolution Policy?

The Uniform Domain Name Dispute Resolution Policy (the UDRP Policy) adopted by the ICANN Board on October 24, 1999 sets out the legal framework for the resolution of disputes between a domain name registrant and a third party over the abusive registration and use of an Internet domain name in the generic top level domains or gTLDs (e.g., .biz, .com, .info, .mobi, .name, .net, .org), and those country code top level domains or ccTLDs that have adopted the UDRP Policy on a voluntary basis. The procedure is administered by dispute resolution service providers accredited by ICANN (e.g. WIPO Arbitration and Mediation Center)

Any person or entity wishing to register a domain name in the gTLDs and ccTLDs in question is required to consent to the terms and conditions of the UDRP Policy.

 

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What is the Internet Corporation for Assigned Names and Numbers (ICANN)?

ICANN is a global non-profit, private sector organization that manages Internet resources for the public benefit. It is best known for its role as technical coordinator of the Internet’s Domain Name System.

To coordinate, at the overall level, the global Internet’s systems of unique identifiers, and in particular to ensure the stable and secure operation of the Internet’s unique identifier systems. In particular, ICANN:

1.       Coordinates the allocation and assignment of the three sets of unique identifiers for the Internet, which are:

a.      Domain names (forming a system referred to as DNS)

b.      Internet protocol addresses and autonomous system numbers

c.      Protocol port and parameter numbers

2.       Coordinates the operation and evolution of the DNS root name server system

3.       Coordinates policy development reasonably and appropriately related to these technical functions.

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What is Typosquatting?

Typosquatting, also called URL hijacking, is a form of cybersquatting that targets Internet users who incorrectly type a website address into their web browser. Should a user accidentally enter an incorrect website address, they may be led to alternative website, usually designed for malicious purposes such as stealing identities, installing drive-by malware, redirect web traffic to their own or a competitor’s product, or making revenue from the user clicking on advertisements.

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What is Cybersquatting? 

Cybersquatting  is the practice of registering as Internet domains identical or similar to a third party company name or trade mark, with bad faith intent to profit from the goodwill of a third party brand, or in the hope of reselling them at a profit.

Cybersquatters exploit the first-come, first-served nature of the domain name registration system to register as domain names, third parties’ trademarks or business names or names of famous people, as well as variations thereof.

A common motive for cybersquatting is the intention to sell the domain name back to the trademark owner, to profit from the goodwill of a third party brand, or to attract web traffic to unrelated commercial offers.

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What is a domain name?

Domain name is a human-friendly form of an Internet address. It is used to identify the complicated string of numbers composing an IP Address which is hard to remember by heart. In other words, a domain name is linked to the relevant IP address and is used to find web pages in a user-friendly way. Domain names are registered with accredited Registrars and consist of two parts: a top-level domain (TLD – .com, .net, .org, .eu) and a second level domain, which represents the entity that owns the domain name.

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No. To qualify for trade mark protection a domain name itself should function as a trade mark. Concretely this signifies that a domain name must not be used simply as an address to direct to a website, but to identify the products and/or services of the business, which provides products and/or services via the Internet.  For example this will be the case of a domain name used in connection with a website that offers web-related services.

The registration of a domain name with an accredited registrar does not automatically signify that the same or similar sign will satisfy the requirements for trade mark registration. You can register as a domain name common or descriptive terms, that usually do not qualify for trade mark protection. Furthermore trade mark protection of a sign is needed only when such a sign will be used to identify and distinguish the commercial origin of the products and/or services of one company from those of another company.

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Registering a domain name means that you have the right to use the name for the registration term, consistent with certain terms and conditions, as well as applicable laws.

Registering a domain name does not give you any ownership (proprietary) rights to the name. Only a registered trade mark can provide that kind of protection.

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The system for domain name registration generally operates on a first-come first-served basis and no two domain names can be exactly the same. It is strongly advisable to search the domain name databases and to check that the same or a similar domain name doesn't already exist or exists in another top-level domain.

The easiest way to check if a domain name is available is at one of the companies that have been approved to register domain names. A list of accredited and accreditation-qualified registrars can be found on the ICANN (Internet Corporation for Assigned Names and Numbers) web site: www.icann.org

It is also a best practice to do a trademark search before you register your domain name, since domain registrars generally do not check if a requested name violates an existing trademark. Therefore, if you register a domain name that conflicts with someone else’s trademark, you could lose the right to it if the trademark owner takes legal action against you.

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Intellectual property rights (IPR) are legal rights aimed at protecting the creations of the intellect, such as inventions, the appearance of products, literary, artistic and scientific works and signs, among others.

Type of creation   Intellectual Property Rights
literary, artistic and scientific works copyright
performances of performing artists, phonogram recordings by producers, and rights of broadcasters over radio and TV programmes related rights or neighbouring rights
inventions patents and utility models
product appearance design
signs - words, phrases, symbols or designs (or a combination of these) which are used as brands of goods and services trade mark

 

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Intellectual property is created by most companies, whatever business they are involved in. For many of these organisations, intellectual property is even their most important asset (e.g. startup or spin out companies)

Safeguarding this possession is therefore vital and can offer SMEs many opportunities, in particular:

  • to have an exclusive set of rights in the market over their creations (for example, a patented invention allows a monopoly of twenty years, and means that a patent provides its owner with a right to prevent or exclude all others from commercially using it);
  • to obtain higher returns on their investments, since owning intellectual property rights may not only enhance the bargaining power, but may also be exploited through licences in return for royalty payments;
  • to enhance the market value and increase future profit expectations of an organisation in the eyes of investors and financing institutions.

It is therefore essential that SMEs consider protecting their creations through intellectual property and efficiently manage these assets to reap the most from their investment.

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In Your Europe, a website maintained by the European Commission, you can find an overview of the intellectual property (IP) framework at the EU level and also in all Member States. A list of resources and contacts of organisations that can provide you with further assistance can also be found on this website.

National IP offices are also a valuable source of information. In the website of the World Intellectual Property Organization (WIPO), there is a Directory of Intellectual Property Offices where you can find the contact details of all IP offices in the EU.

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This matter is not harmonised at the European level, and is therefore regulated by national laws. However, as a general principle in Europe, the rights to intellectual property developed by an employee in the course of his employment duties usually belong to the employer. Sometimes an assignment is mandatory, such as where employee works (inventions) are assigned by an employee to the employer because of the employment contract. On the other hand it is generally acknowledged that the rights to intellectual property (e.g. inventions) developed "on the side", with no relation to the employment relationship and without use of company resources, is the property of the employee.

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A design is the outward appearance of a product or part thereof resulting, in particular, from the characteristics of the lines, contours, colours, shape, surface, structure and/or materials of the product itself and/or its ornamentation.

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Besides the protection for registered Community design, the Council Regulation (EC) nº 6/2002 of 12 December 2001 on Community Designs provides a short-term form of protection for unregistered industrial designs. Registration is not required. Protection lasts for a period of three years and starts when a new design with an individual character is made available to the public in such a way that the interested circles within the European Union could be aware of its appearance. Unlike a registered design, it is not necessary to file an application to obtain protection. The unregistered design constitutes a right to prevent the commercial use of the design only if the use results from copying.

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A well-designed product can be synonymous with the image of your undertaking, and thus becomes a valuable asset for you. If you do not protect your design, others may benefit from your intellectual property.

Nevertheless, depending on the national or regional law system, a design which has not be registered may still be protected in different ways:

- under industrial property law (as an unregistered design),

- as copyright (if exists as an original man-made work)  or

- under unfair competition law.

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The subject of the design protection is the outwardly visible appearance of the product or its part, packaging or the ornamentation itself.

A design is protected by an exclusive right if it is new and has individual character. A design is regarded as new if, on the date on which the application for registration has been filed, no identical design has been made available to the public.

A design is considered to have an individual character if the overall impression it produces on an informed user differs from the overall impression made by any design available to the public before the date of filing of the application for registration.

Further requirements for design protection may vary in different countries.

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The design protection gives to its holder the exclusive right to use it and to prevent any third party from using it without the holder's consent. The aforementioned use shall cover, in particular; making, offering, putting on the market, importing, exporting or using a product in which the design is incorporated or to which it is applied, or stocking such a product for those purposes.

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In most countries, registered design protection is renewable by periods of 5 years from the filing date, up to a maximum of 25 years.

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There are different ways to acquire design protection, through application to national, Community design or Hague design offices. 

In the EU, you may obtain a community design registration valid in all member countries through a single application, which can be filed directly in the European Union Intellectual Property Office (EUIPO) in Alicante (Spain) or through any of the EU national Industrial Property Offices. If the design is registered by national offices, the protection is limited to the country in which protection is granted. Some countries (e.g. the UK) provide the protection of unregistered design in their national legislation. Furthermore, all designs in the EU fulfilling specific criteria for protection are automatically protected (without registration) as unregistered Community designs. 

The Hague System for the International Registration of Industrial Designs provides a mechanism for registering a design in several countries by means of a single application, filed in one language, with one set of fees. The system is administered by WIPO.

 

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The features of appearance that result solely from the technical function of a product cannot be protected as a design. The components of a complex product are protected only if they are visible during the normal use of a product and if they are new and have individual character. Design features enabling one product to be functionally fitted or aesthetically matched to another are excluded from protection. These so-called 'must-fit' and 'must-match' exceptions are influenced by the need to ensure that third party providers of spare parts should not be unfairly prevented from competing within the spare parts market.

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The existence of a grace period and the corresponding requirements can be provided by applicable national laws. The law can allow the filing of an application for registration of an industrial design after its disclosure, within a limited time period from the date of disclosure (generally six months or a year). This is particularly useful for small businesses since they frequently lack the funds to finance registration of designs, which may not be successful on the market.

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You should keep in mind that the laws concerning the enforcement of IP are not the same in every country. Hence, since law harmonisation is not the case in IP enforcement, it is safer to try – at least at the first stage – to resolve any IP dispute out of court.  However, if all of the attempts to find an out-of-court solution fail, IP owners shall rely on court proceedings. The contribution of an IP lawyer is pivotal at this point.

In this context, two different proceedings can take place; civil actions and criminal prosecution.  Bringing a civil action to the court means that you are about to enforce your IP rights by filing a lawsuit for infringement in a national specialised civil court. That is to say, you are applying for a preliminary or permanent injunction or other forms of interim measures (i.e. seizure of bank account) and claiming for a compensation through the award of damages. Other relief measures may also be confiscation as well as the destruction of illegal goods. It is to be noticed that since IP legal proceedings are rather costly, you are advised to anticipate an approximate budget for enforcement litigation and insuring the organisation against the financial costs linked to it.

Criminal prosecution, on the other hand, is also possible under certain circumstances and sanctions such as criminal fines, confiscation, destruction of goods and even imprisonment can be posed by courts. However, these criminal offences can be brought to trial only by public prosecutors and decided upon by criminal courts. Furthermore, it is to be noticed that criminal prosecution is mainly for trademarks and design “counterfeiting” as well as for copyright “piracy” or theft of confidential business information since the legal base of prosecution is usually the infringer’s intention to benefit financially from the commercial advantage of the IP owner. 

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In case you do not wish to get involved in long-term and costly litigation proceedings, a set of alternative measures is available for you.

First of all, you should approach the person/organisation that is supposedly infringing your IP rights by sending a letter of demand, also known as “cease and desist letter". The letter will advise the alleged infringer that a court action may be taken  if  the  infringing  activities  do  not  stop  within  a  certain  period  of  time. It is to be noticed that you should avoid posing threats to the other party, or include false statements as this may lead to your legal liability.

In case the alleged infringement involves shipments of goods from outside of EU (or from EU to third countries) you can bring your claim to the competent customs authority. You can apply a notice with the customs authorities in order to stop shipments of infringing goods directly at the EU border. The intervention application requests the inspection of possible infringing goods imported from or exported to third countries and, where the customs find grounds for infringements, their consequent seizure. This application is valid for one year but can be renewed and no fees are required upon submitting it.

Another viable option is applying one of the Alternative Dispute Resolution (ADR) mechanisms. ADR refers to non-litigious methods to resolve disputes. Depending on the intended result you can choose between informal negotiations and more formal proceedings such as mediation and arbitration. ADR may be advantageous from the point of view of costs and of the likelihood and speed of settlements, as well as appropriate for avoiding that the organisations reputation and, hence, their relations with other organisations and costumers be damaged. Parties  may  agree  in  advance  to  resolve  any  disputes  by  ADR  before  initiating any legal  proceeding,  by  including  ADR clauses  within  commercial  agreements. On the other hand, a court decision may order the  parties  to  pursue  a  specific form of ADR.

In broad terms, negotiation refers to a voluntary and non-binding out-of-court settlement. Even though the assistance of a lawyer is not mandatory, it is strongly recommended that the resulting settlement agreement is to be drafted by a lawyer, since there are complex legal aspects which have to be covered within the final document (compensation, damages etc.).

Mediation is also a non-binding procedure in which an external third party assists the participants in reaching their own decision over a dispute. Mediation is a confidential procedure assuring the parties that any admissions, proposals or offers for settlement will not have any consequences beyond the mediation process.  They  cannot,  as  a  general  rule,  be  used  in  subsequent  litigation  or arbitration.  Most important, the mediator has no decision authority and any settlement result is normally enforceable as a contract, a breach of which is enforceable in subsequent litigation. 

On the other hand, arbitration is a formal procedure in which the parties submit a dispute to a tribunal of one or three arbitrators who issue an enforceable binding decision. What differentiates the arbitration proceedings from the traditional litigation proceedings is that the arbitrator is not bound to follow substantive law, but may also employ concepts of equity and justice, business practices and whatever technical expertise relevant to the case.

In all those cases, it is advisable to seek a proper legal advice, since the course of action will depend on the circumstances of each particular case.

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When you become aware about the possible unlawful use of your rights by third parties,  should  precisely  identify  the  alleged  infringers  in  order  to eventually bring to an end to the infringing activity.

There  are  several  ways  to  enforce  your  IP  rights,  ranging  from relatively  simple  measures  to complex  litigation. Court proceedings are costly and lengthy and therefore other preliminary tools should be used so as to prevent subsequent litigation. In many cases private negotiation via legal professional is more effective and should be considered as a viable option,particularly for SMEs which often are faced with budgetary constraints.

It is a common practice to approach the person who is supposedly infringing your IP rights by sending a letter of demand, also known as “cease and desist letter". The letter will advise the alleged infringer that a court action may be taken  if  the  infringing  activities  do  not  stop  within  a  certain  period  of  time. It is to be noticed that you should avoid posing threats to the other party, or include false statements as this may lead to your legal liability. A previous consultation with a lawyer may be advisable in this respect.

In case a letter of demand does not result in cessation of the alleged infringement, further legal steps are available, such as customs actions, settlements (through informal negotiations, mediation or arbitration) and/or litigation (civil actions or criminal prosecution where available).

In any case, it is advisable to seek a proper legal advice, since the course of action will depend on the circumstances of each particular case.

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In general terms, IP infringement is any breach of intellectual property rights.

IP rights are infringed when a work protected by IP laws is used, copied or otherwise exploited without having the proper permission from a person who owns those rights.

Examples of an IP infringement are “counterfeiting” and “piracy."

Counterfeiting is the practice of imitating genuine goods, often to inferior quality, with the intent to take advantage of the superior value of the imitated product.

Piracy is an unauthorized copying, use, reproduction and/or distribution of materials protected by intellectual property rights.

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IP due diligence is performed in the following contexts:

·Merger and acquisition or joint ventures: aiming to provide a basis for risk and value assessment of relevant IP assets in a proposed acquisition or sale of IP

·Financial transactions: aiming to determine the impact of IP assets on IP related financial transactions such as stock purchasing, security interests, initial public offerings, etc.

·IP assignments and IP licensing: aiming to provide information to the potential assignee or licensor about the IP portfolio, concentrating on verification of ownership and possible restrictions affecting the use of the IP

·Launching of a new product or service: aiming to evaluate any possible infringement risks or freedom-to-operate issues linked to the new product or service

·Bankruptcy and layoffs, etc.: aiming to secure the IP rights in case of bankruptcy, employee layoffs, etc. 

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Broadly speaking, depending on the objectives of the audit, there are two types of IP audits :

General IP audits: General-purpose audits draw an overall but comprehensive picture about the company’s IP assets. Such audits scrutinise the IP portfolio as a whole to review the businesses’ IP management approach, if there is one. If not, general IP audit is a core and fundamental step to develop an IP management approach and an IP-intensive culture within the company.

Specific IP audits: These types of audits are generally known as IP due diligence. They have a narrower scope and usually focus on identification and evaluation of IP assets relevant to the explicit objective of the audit. 

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IP audit is an important business tool, which helps to:

·better identify and monitor the whole intellectual asset portfolio: by clarifying which tangible assets are owned, used or non-used and verifying the owners of these assets

·better secure the IP: by suggesting the most applicable and effective ways to protect the IP assets owned

·effectively exploit the IP: by showing whether the IP is efficiently exploited and by revealing the not used and/or underused IP assets

·set up an effective IP administration structure: by providing guidance for the development of sound and elaborated IP management

·make the IP strategy align with the business strategy: by highlighting possible inconsistencies between the IP strategy and the business targets

·determine the value of IP assets: by assisting in valuation of IP assets to discover the existing value of the company

·foresee and manage possible future risks: by determining whether the company’s IP assets are infringing the rights of others or others are infringing on rights held by the company

·reduce costs: by enabling a reduction in maintenance costs for obsolete IP assets and by helping to avoid costly and tedious court actions for possible infringement cases

·nurture inventiveness and creativity: by building up innovation support mechanisms and encouraging IP creation within the businesses

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An IP audit is a systematic, thorough and solution-focused review of the intellectual assets owned, used or acquired by the businesses to ascertain their legal status, value, potential IP-related risks and the means for protection and to capitalise on them.

A formal IP audit serves two general purposes: (1) identification and evaluation of IP assets (2) anticipating and managing the risks that could be linked to the IP portfolio of the company.

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The IP valuation of a company’s assets is a study based on law, economics, finance, accounting, and investment at a particular point in time, which requires expertise on technical matters, intellectual property, marketing, finance and strategy. IP valuation is a process which aims to collect important information in order to determine the actual monetary value of particular intellectual property assets as well as the future economic benefits that they will bring.

An accurate assessment of the value of intellectual property can be very useful in the business environment to facilitate management decisions related to effective development and marketing of products. Therefore, the following aspects can be considered by businesses as incentives to conduct an intellectual property valuation:

  • valuing intellectual property facilitates investment in industry, making business more attractive and more viable to potential investors and shareholders; 
  • IP valuation facilitates the commercialisation and transactions of intellectual property rights; for example  the assessment of the value of the intellectual property can be used  before and in the process of negotiating the terms of a transfer, licence and franchising of intellectual property rights;
  • IP valuation will also be useful when determining investment strategies, in particular establishing a new enterprise, merging of legal entities or setting up joint ventures;
  • a thorough understanding of the value of the IP assets ensures more informed negotiation and allows the determination of fair royalty rates; and
  • IP valuation can provide the management with the information needed to ensure optimal conditions for the exploitation of the IP asset, which fits within the business strategy of a company.

IP valuation can also help to choose a strategy to be used in case of intellectual property disputes when deciding whether to introduce a court action or to opt for alternative dispute resolution mechanisms such as mediation or arbitration. 

Assessing the economic value of intellectual property is often used in research and development management and marketing analyses.

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Several approaches and methodologies are commonly used to estimate the value of intellectual property assets. However, businesses often have some difficulty in selecting the method that is most appropriate for valuing a specific asset in a particular business situation, since they all have their limitations and no one method is exclusively suitable in all cases.

There are sets of rules and criteria which may be applied before deciding how the economic value of the IP will be calculated.  It is very important to consider the following aspects:

  • the type of IPRs (e.g. trade marks, industrial designs, patents);
  • the purposes of the valuation;
  • the relevant information available;
  • the potential market for them (geographical coverage);
  • the risks associated with the investment in intangible assets; and

the type of the business activities of the parties and the competitors involved in the transaction where the IP constitutes the relevant element (e.g. transfer or licensing of IP).

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The approaches of IP valuation are generally grouped into two main categories with a few subcategories:

  • The quantitative (monetary) valuation – the intellectual property value is expressed in monetary terms and includes the following methods:
    • Cost-based method – this method is used to measure the costs in developing the intellectual property, which could be the actual cost incurred in creating the IP or the estimated cost of replacing the IP or creating an equivalent asset;
    • Market-based method –  the value of the IP is determined by comparison with identical or similar IP for which price information is available;
    • Income-based method –  is broadly used to value the amount of economic income that the IP asset is expected to generate adjusted to its present day value;
  • The qualitative valuation (non-monetary)  – the intellectual property value is obtained through  “value indicators”, such as the type of the legal protection of the intellectual property, the level of the research and development in a technology, the market of the products and/or services commercialised, etc.

In order to have accurate and usable results, it is important to select the most appropriate method or combination of methods for each individual case. Indeed some of those methods are more suitable for the valuation of certain IP assets. The cost-based method is commonly used in the valuation of software and databases, the market-based approach for the valuation of IP assets such as trade marks, patents, and related research and development activities. In practice, in most cases an effective valuation applies a combination of the methods listed above. Performing proper IP valuation is a complex issue and therefore requires using the services of qualified valuation experts specialised across the wide variety of industries and assets and who have the ability to critically analyse the multitude of valuation contexts.

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No universal licencing agreement model exists. Licence agreements will vary depending on the subject of the licencing activity, on the corresponding applicable law used to construe its provisions and on the circumstances of each specific case.

We draw your attention to the following issues:

In general, the scheme of a licence agreement is simple: the licensor (owner of IP rights) allows the licensee to use its IP rights. The licensee may use the licensor's IP rights to the extent established in the licence agreement; however, the formal IP rights remain with the licensor.

  • While drafting a licence agreement do not forget to cover its core issues, such as: the subject of the licence (all IP rights, future IP rights, know-how), territorial scope of access rights, commercial scope and field of use of licensed rights, exclusivity/non-exclusivity of the licence, duration of effects of the licence, compensation (payments, shares, cross-licenses, etc.), royalties, applicable law (especially important in case of transnational agreements), consequences of the breach of the licence agreement, etc.
  • Negotiating and drafting of an efficient licence agreement might be quite complex and sometimes requires independent professional advice so that potential legal pitfalls can be avoided.

In order not to miss the most important elements that a licence agreement should include, we suggest that you get acquainted with the guide Healthcheck booklet (in the series: Licensing Intellectual Property) which is available on the UK Intellectual Property Office homepage.

https://www.gov.uk/guidance/licensing-intellectual-property                          

Examples of templates that may help you outline the likely content of a licencing agreement can be, furthermore, found in the ipHandbook of Best Practices.

http://www.iphandbook.org/handbook/resources/Agreements/

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In certain cases, having licence rights to a patent will not be enough for the licensee to use, exploit or manufacture the related invention in an efficient way. Beyond the patented innovation, the licensee will in many cases need access to the unpatented technical information which relates to it.

In such cases, instead of a mere patent licence, it may be worthwhile to conclude a “patent and know-how licence” in order for the licensor to grant access not only to its invention, but also to the technical know-how relevant thereto. This will enable the licensee to fully use and understand the invention.

Of course, licensing know-how will only make sense insofar as this know-how has been kept secret, i.e. that there is an economic value to it and a need for the licensee to gain access to that knowledge, which would otherwise not be known nor be readily accessible.

Licensing secret know-how can involve some risks linked to its potential, unwanted disclosure to third parties. For this reason, a patent and know-how licensing agreement should address questions of confidentiality and non-disclosure in a thorough manner, in order to define as precisely as possible the ways in which the licensee can use and further disclose the licensed know-how. The licensee, its staff and relevant third parties (such as possible subcontractors) should be given confidentiality obligations which are, in their scope and strength, at least as stringent as those put into place by the licensor to protect its trade secret.

Finally, special attention should be given to the duration of the intellectual property right being licensed, since the period of the licence cannot exceed the maximum duration of the right (e.g. 20 years for patents). In the case of a patent and know-how licence, this means that the parties should make a clear difference between the patent licence (which cannot last past the expiration of the patent) and the know-how licence (which the parties may wish to keep in force after the expiration of the patent).

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The use of a CCL does not mean that you do not have the copyright on your work anymore. Instead, a CCL helps the creator of a copyrighted work to retain some of his rights stemming from copyright while making available to the public his work and ensures that he gets the credits for his work.

As the creator of a copyrighted work, you have the flexibility to choose which rights will be reserved by choosing among the different types of licences. However, once you use a CCL, you cannot prevent others from copying and distributing your work. Hence, if you wish to reserve all of your rights under copyright law, then you should not use a CCL. 

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In general terms, a CCL can be used for any copyright protected work (books, movies, etc). However, since the work released under a Creative Commons licence is governed by the applicable national copyright law, national legislation may pose restrictions to the context of the free distribution. Moreover, it is to be noticed that Creative Commons – a creator of CCL – does not recommend the use of Creative Commons licences for software.

Furthermore, Creative Commons licences are non-revocable. This means that once a piece of work has been made available under a CCL, this work, or its copies, may continue to be used only under that licence. 

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The Creative Commons licence (CCL) is a copyright licence that allows the user, who is not the copyright owner of a work, to distribute freely an otherwise copyrighted work. In this context, a CCL works mutually for both the copyright owner and the end-user, since it gives the author the freedom to allow people to share, use, and build upon a work that he/she has created and protects the users from a possible copyright infringement claim. 

It is to be noticed that there are several types of CCLs and the users have to comply with the terms of distribution posed by the copyright owner and indicated by the respective CCL, otherwise they could be held liable for copyright infringement. 

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Although in both cases the licensor permits the licensee to use his/her intellectual property in return for a negotiated compensation, exclusive and non-exclusive licences refer to the degree of exclusivity that will be granted to the licensee.

In an exclusive licence, the parties agree that no other person/legal entity can exploit the relevant IPRs, except the licensee.

On the other hand, a Non-Exclusive Licence grants to the licensee the right to use the IPRs, but on a non-exclusive basis. That means that the licensor can still exploit the same IPRs and he/she can also allow other licensees to exploit the same intellectual property.

You should note, however, that this classification is not restrictive. There are also other types of licences. For example, in licences known as “co-exclusives” the licensor grants a licence to more than one licensee but agrees that it will only grant licences to a limited group of other licensees. Moreover,  licences called as “sole licences” are those in which the licence is exclusive in the meaning that there would be no more licensees, but the licensor also reserves full rights to exploit his/her intellectual property.

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A patent is an exclusive right granted by countries or communities for the protection of inventions, whether products or processes, that offer a new technical solution or provide a new way of doing something, during a limited period of time, usually 20 years. In return of this limited monopoly, the owner of a patent must disclose the invention to the public, in the patent application. A patent is a territorial right and has its effects within the national boundaries of the country for which it was granted.

In order to get patent protection, inventors must file a patent application, since registration is a requirement in order to obtain protection.

Example of a patent:  Tinting Plastic Optical Lenses

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Patents are territorial rights that require registration - that is, in order to protect your invention in a given country, you must file a patent application in the country concerned or through a regional patent office designating countries in which protection shall be obtained. The European Patent Office offers a very simplified way to apply for several national patents through a unique "European" patent application. You can also file an application under the Patent Cooperation Treaty which allows the owner of an invention to seek for a national patent protection in several countries by filing one “international” patent application.

Hence, if you would like to have a patent in an EU Member State, we suggest that you contact the national patent office of the country or one of the regional patent offices in order to file the patent application there. Irrespective of the filing procedure, the rights to which you are entitled will depend on the national law of the country of registation.

Please note that filing a patent application is highly technical, and choosing the appropriate procedure (at national, European or international level) certainly has implications in terms of cost and time. Therefore, we encourage you to seek legal advice before taking the decision to submit any patent application.

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If you want patent protection in more than one EU Member State, it is possible to file patent applications directly in each of the national patent offices of the countries where you seek protection. Another option that you have is to use the European Patent Convention (EPC), which allows you to register patents in more than one European country through a single application. In this way, even though you file only one patent application, you will be granted as many patents (usually called European patents) as the number of countries you have designated. These patents are then treated as national patents in each of the designated countries. You will find information on the countries where this procedure is available here.

For further information on the procedure to file a patent under the European Patent Convention, we suggest that you consult the following links:

(i)    Guide for Applicants, prepared by the EPO

(ii)   Information on how to apply for a European Patent, also prepared by the EPO

Please note that filing a patent application is highly technical and has important implications in terms of cost and time. Therefore, we encourage you to seek legal advice before taking the decision to submit any patent application.

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The Unitary patent is a single European patent with unitary effect in the 26 EU Member States which have engaged in an enhanced cooperation to this effect. The unitary patent is granted by the EPO under the rules and procedures of the European Patent Convention.  In order to obtain a unitary effect, patent holders need to request the unitary effect at the European Patent Office (EPO) within one month of the date of publication of the patent grant in the European Patent Bulletin.

The Unitary patent may be requested from the date of entry into force of the Agreement on a Unified Patent Court. This Agreement was signed by 25 EU Member States and will need to be ratified by at least 13 Member States, including France, Germany and the United Kingdom, in order to enter into force. This is predicted to take place in the first quarter of 2018 per the EPO.

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No. The unitary patent will co-exist with national patents and with classic European patents (i.e. without unitary effect) as a third option for companies or inventors seeking patent protection in Europe. Patent applicants remain free to choose between national patents, classical European patents and unitary patents. They can also use a combination, such as:

  • a unitary patent for the Member States participating in the unitary patent cooperation, together with national patents covering the member states which did not take part in this cooperation;
  • a unitary patent for the Member States participating in the unitary patent cooperation; together with a classic European patent taking effect in one or more Contracting States to the European Patent Convention which do not participate in the cooperation, such as Spain, Switzerland, Turkey, Norway, Iceland, etc.
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Compared to the “classical” European patent which becomes a bundle of national patents validated in each Member State where protection is requested, the Unitary patent will give its holder a unique patent protection – uniform scope and equal effect of protection -  in 26 Member States of the European Union. For the applicants, this entails no further need for national validation, and offers a single annuity, one place to register transfers and licencesand after grant, and no further translation requirements.

The aim of the Unitary patent is to simplify the existing system by offering businesses an alternative route to patent protection and dispute settlement.

The existing system incurs costs for validation and renewal fees in each Member State where protection is granted, including related translation costs. In comparison, there is only a single renewal fee for the Unitary patent, and no validation costs except the cost for one translation during the transitional period.

Indeed, for a transitional period of 12 years, until a machine translation system maintained by EPO (called “Patent translate”) becomes fully operational, a full translation into English of the European patent specifications must be provided if the Unitary patent is granted in German or French or, if the language of the proceedings is English, into an official language of a EU member state. In any case, translations into a relevant EU language may be requested by a court or by a defendant in an infringement case.

Unlike enforcement of European patents, which has to be carried out in each national jurisdiction, the Unitary patent may be enforced or revoked in a single action for all the participating territories before the Unified Patent Court.

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The Unified Patent Court will be a common patent court for the 25 Member States that have signed the Agreement on the Unified Patent Court. This Agreement is still undergoing a process of ratification by the contracting Member States and therefore the Court will start to examine cases only when it enters into force.

The European Patent Court will have exclusive competence in respect of actions of infringement, declarations of non-infringement of patents (classical European patents and European patents with unitary effect) and supplementary protection certificates, revocations of patents and declarations of invalidity of supplementary protection certificates, actions for provisional and protective measures and injunctions.

The UPC will not have competence with regard to national patents or supplementary protection certificates granted for a national patent.

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If you have decided to protect your invention by patent in several European and non-European countries, you may consider filing an international patent application under the Patent Cooperation Treaty (PCT). Similarly to the EPC, the PCT provides for the filing of a single patent application (usually called an international application) with effect in several countries. The difference is that a PCT patent application does not have a regional scope like the EPC, but an international one. For further information on the procedure to file a patent under the PCT, we suggest that you consult the following links:

(i) Countries where PCT International procedure is available;

(ii) The PCT’s Applicant Guide prepared by WIPO;

(iii) The Guide for Applicants prepared by the EPO.

Please note that filing a patent application is highly technical and has important implications in terms of cost and time. Therefore, we encourage you to seek legal advice before taking the decision to submit any patent application.

 

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No. An invention in all fields of technology can be protected, but it must fulfil the following requirements:

  1. Novelty: it must show a new characteristic which is not known in the existing knowledge in its technical field - that is, not being part of the state of the art;
  2. Inventive step: the invention can not be deduced by a person with average knowledge of the technical field;
  3. Practical use:  it must be capable of industrial application.

Countries may also deny under their laws patent protection to determined subject matters or types of inventions such as mathematical methods, scientific theories, plant or animal varieties, discoveries of natural substances, commercial methods, or methods for medical treatment (as opposed to medical products).

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No. Inventions can also be protected by trade secrets if you keep them in secrecy. In some EU Member States, you may file an application for utility models as well as a patent application.

  Patent Utility Model Trade Secret
Advantages
  • exclusive right
  • effective tool against imitators
  • protection up to 20 years, which is generally considerably longer when compared to utility models
  • exclusive right
  • effective tool against imitators
  • lower registration costs when compared to patents
  • no registration costs 
  • protection not limited in time
  • no disclosure required
Disadvantages
  • costs for registration can be high 
  • the invention must be disclosed in the application
  • not available in all countries
  • costs for registration
  • shorter protection than patents
  • not available for all kinds of inventions
  • often not an effective tool for product inventions
  • limited remedies available 
  • not easily enforceable
  • can be patented by others 

Thinking about market strategy, publishing an invention may also be an option for protection, if you do not need to have exclusivity. It is certainly a cheaper option and it has the advantage of blocking others from getting a patent on the same invention. However, take into account that you will be revealing your innovation to possible competitors.

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Conducting patent searches is very useful for several purposes, not only for organisations such as SMEs and universities, but also for researchers. Indeed, patent databases are a goldmine of technical and commercial information that can be used to:

  • guide the definition of an organisation’s IP strategy (identifying, for example, any barriers to developing an IP strategy, the avoidance of obstacles, etc.);
  • define the state of the art (to find out what already exists, to check novelty, to improve the quality of a patent application, to understand the IP landscape surrounding your projects and IP);
  • check for freedom to operate (to check if you do not infringe someone else's rights, or to search for the validity of third parties’ IP);
  • check if someone is not in a position of infringing your rights (infringement still needs to be proved);
  • keep track of who’s doing what (commercial intelligence).

Many of the patent applications that you can find in the databases are not even “in force” and therefore are free to be used in your own projects. This can happen for different reasons, such as the application's failure, withdrawal or expiry.

 

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Patent owners in the EU are generally entitled to prevent others from making, using, offering for sale, selling, or importing for these purposes the invention without prior authorisation.

Consequently, if you get patent protection, other persons and organisations cannot exploit your patent protected work without your consent. However, it is important to remember that you will be entitled to this set of rights only in the territories where you have been granted a patent and as long as the patent subsists.

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The meaning of the expression “Patent Pending” varies depending on the national law of each country. However, in principle this term is used in reference to:

-          the legal status of a patent application - “notice given (by the relevant Intellectual property office) that an application for a patent has been filed and that legal protection (including retroactive rights) may be forthcoming” – source: EPO

-          a warning notice that is affixed in products to inform the public that an application for a patent on that product was filed and to ward off potential infringers; even if not compulsory, such a notice can be particularly relevant in court infringement proceedings. On the other side, in most countries you are allowed to apply the term “patent pending” to a product only if there is, in fact, a pending patent application. If a product is marked with “patent pending” when there is no associated patent application, most national laws in the EU countries sanction this behaviour - usually under competition law and/or patent law.

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The inventor is the creator of the invention. In the EU this term is defined by each member state’s legislation. In general, in order for one to be considered an inventor, it is acknowledged that a certain level of contribution to the development of the creative elements of an invention (technical creativity) must be met. Inventors are always private individuals and are always entitled to be designated on the patent, regardless of who files the application. Joint inventors or co-inventors exist when a patentable invention is the result of the inventive work of more than one inventor, even if they did not contribute in equal parts.

According to the European Patent Convention (EPC), of which all EU member states are signatories, in principle the inventor, or his successor, has the right to the patent. In practice, whoever applies for a patent is presumed to be the inventor, so the inventor and the applicant usually coincide. In many jurisdictions, however, the applicant will not necessarily be the inventor – for instance in cases where the ownership of the invention has been contractually assigned to another entity –  even if the inventor will always keep the right to be mentioned as such in the application. This greatly depends on national law, although the EPC regulates the question in broad terms.  In particular, in several countries there are laws on employees’ inventions and on inventions made at universities (professors’ privilege) that may establish a special regime. For example, it is very common that in the context of an employment relationship, rights in inventions created by employees are assigned to the employer by the employment contract or considered as belonging to the employer by law. In that case, the applicant (i.e. the future owner of the patent) is not the inventor.

Finally, ownership recognises a proprietary right to the invention that will in principle vest in the applicant after the patent is granted. As a proprietary property right, the ownership of a patent can be transferred.

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According to the European Patent Convention, a patent application filed within the EPO provisionally confers from the date of its publication the same rights which a national patent would confer once granted in the designated countries. These are the legal rights which the national law of the designated countries may confer upon the proprietor of a patent on an invention (product or process) when granted. For example, this provisional protection can refer to what acts of third parties constitute infringement of the patent and to the remedies available in respect of infringement. In principle, this means that the applicant can claim reasonable compensation from any person who has used the invention after the publication of the patent application, provided that such use would be considered an act of infringement of a national patent under the relevant national law.

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The cost of patent applications varies from country to country and depends on the route taken to pursue protection (national, European or international).

Nevertheless, there are costs other than the fee that you must pay for the application which you should consider, in particular the following:

  • After the application and during the life of a patent, applicants must pay renewal fees. These payments are requested by most patent offices and are a requirement to keep patents valid (until their expiry date, which is usually after 20 years).
  • The cost of services of patent attorneys or agents, which in some countries may be very high, must also be added to the total cost.
  • Translation may be required, which can substantially raise the cost of a patent application.
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Even though everyone could theoretically draft their own patent application, we believe that this is not advisable. Patent applications are very technical and, given the costs that they involve as well as the importance of a careful preparation, we encourage you to seek advice from a patent attorney or patent agent.

The Enterprise Europe Network (EEN) can assist you in finding such a specialist. To find the nearest EEN branch, please click here. You may also find lists of authorised patent attorneys in many National Patent Offices and at the European Patent Office.

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A supplementary protection certificate extends the period of effective protection for patents on new medical products for which an authorisation to be placed on the market is required.

A supplementary protection certificate serves as a compensation for the investments put into research for the period that elapses between the filing of a patent application for a new medicinal product and the obtention of an authorisation to place such a product on the market.

In the European Union, a supplementary protection certificate can be granted under the following conditions:

·         at the date of the application for supplementary protection, a product is protected by a basic patent in force;

·         the product has not already been the subject of a certificate;

·         a valid and first administrative authorisation to place the product on the market as a medicinal product has been granted.

Supplementary protection certificates are applied for and granted at national level by the competent industrial property office of the Member State where the basic patent has been issued and in which the authorisation to place the medical product on the market was obtained.  At national level, each European Union Member State can designate another specific authority for this purpose.  

Once granted, the certificate takes effect at the end of the lawful term of the basic patent for a period equal to the period which elapsed between the date on which the application for a basic patent was lodged and the date of the first authorisation to place the product on the market in the European Union, reduced by a period of five years.

However, the duration of the certificate may not exceed five years from the date on which it takes effect.

This means that the holder of both a patent and a certificate benefits from an overall maximum of 15 years of protection from the moment the medicinal product in question first obtains the authorisationto be placed on the market in the European Union.

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Grace period is a specific period of time preceding the filing of a patent application, during which certain types of disclosures of the invention (for which the patent application is filed) do not destroy its novelty.

In general, in order for an invention to be patentable, the novelty criterion has to be fulfilled, that is to say, the invention should not be disclosed to the public before the patent application is filed.

However, some countries under certain circumstances do not take prior disclosures into account in determining patentability, provided they took place within a certain period of time (grace period) preceding the date of filing.

Grace period simply protects the inventor from unauthorised, or (in certain countries) authorised, disclosure of an invention before a patent is filed for. The grace period is usually 6 or 12 months.

Most of the European Patent Convention (EPC) member states adopt a ‘conditional’ patent grace period, that is to say they provide for a grace period under certain circumstances. For instance, in Germany disclosure is not to be taken into account in determining the novelty of a patent if it occurred within six months before the filing date (priority date) due to:

1. an evident abuse to the prejudice of the applicant or his predecessor in title;

2. display of the invention at an official or officially recognized exhibition.

For more information regarding the countries that grace period applies you can have access to the WIPO’s report regarding certain aspects of national/regional patent law available form here.

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Trade marks can be protected through registration. Trade mark registration protects your brand value, defends against rival marks, defines your rights and prevents counterfeiting and fraud.

In many countries, so called well-known trademarks are also protected without being registered. Such obligation result from the provisions of the Paris Convention for the Protection of Industrial Property and the TRIPS Agreement.

Furthermore, in common law countries (such as the UK and Cyprus), unregistered trademarks can also be protected under so called passing off law. Passing off is a common law tort and protects the goodwill of a trader from a misrepresentation. In other words, it prevents one trader from misrepresenting goods or services as being the goods and services of someone else.

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Trade marks are signs used in trade to identify products and services. More specifically, a trade mark is a symbol your customers use to pick you out. It may consist of any signs capable of being represented graphically, particularly words, including personal names, designs, letters, numerals, the shape of goods or of their packaging, provided that such signs are capable of distinguishing the goods or services of your undertaking from those of other undertakings.

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Unlike other intellectual property rights (patents, designs, copyrights), you can hold the right to your trade mark indefinitely. However, in order for your trade mark to be protected, it has to be renewed on a regular basis. The period of trade mark protection may vary, but is usually ten years and it can be renewed indefinitely upon payment of additional fees.

You should notice that, for the most of the countries, it is concerned the trade mark owner’s responsibility to observe the time limit for renewal. However, national IP offices will usually inform you or your representative few months before the expiry date that your trade mark is due for renewal. The same applies for European Union Trade Marks (EUTMs) issued by the European Union Intellectual Property Office (EUIPO).

EUIPO will generally inform you, or your representative six months, before the expiry date that your EUTM is due for renewal. Moreover, any other person holding a right to your EUTM, e.g. a licensee, will also be informed by the EUIPO.

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Trade mark  protection is territorial by nature, i.e. the geographic scope of protection for trade marks is limited and depends on the place of registration. Hence, it is advised that you consider applying for protection for your brand in all territories of your commercial interest. E.g. think not only about intended markets of distribution of a product, but also about the place it is manufactured.

Note that trade mark protection can be obtained in few alternative ways – depending on the brand characteristics and planned commercial strategy - it can be registered as:

·         a European Union Trade Mark (EUTM) for the entire European Union by filing a unique application at the European Union Intellectual Property Office (EUIPO);

·         as a national title, applied for separately in respective counties of interest;

·         an international registration at World Intellectual Property Organization (WIPO) which is equivalent to a bundle of national registrations;

If you wish to register a trade mark which would be valid in the whole EU, you can apply for a European Union Trade Mark (EUTM). For doing so, you should file an application to the European Union Intellectual Property Office (EUIPO). As regards a EUTM applications, however, registration criteria will have to be assessed on a Community-wide scale and have be met at the same time in all 28 EU Member States. This might be problematic for many brand owners. That is why many of them decide for a national/international route instead. You can read more about  EUTMs on EUIPO's website:

·         general information on EUTMs - https://oami.europa.eu/ohimportal/en/trade-marks

·         application guidelines - https://oami.europa.eu/ohimportal/en/apply-for-a-trade-mark

·         FAQs on the application procedure - https://oami.europa.eu/ohimportal/en/application-procedure

·         Registration procedure scheme – https://oami.europa.eu/ohimportal/en/registration-process

·         FAQs on registration procedure - https://euipo.europa.eu/ohimportal/en/eutm-registration-procedure

If your intention is to obtain a national protection in your country or in any other country, you should file an application to the respective national IP office. For information on national applications and procedures please visit websites of the national IP offices of interest - http://www.wipo.int/directory/en/urls.jsp

Lastly, you may wish to register a trade mark internationally. A single international registration is equivalent to a bundle of national registrations. Although it is a single registration, protection may be refused by some or all IP offices of the designated countries. Please note that you can file an international application only with regards to the countries part of the so-called Madrid system (all EU Member States participate in Madrid system). It is administered by the World Intellectual Property Organization (WIPO) and offers a one-step solution for registering and managing trade marks worldwide. Its advantage is that you can have your trade mark protected in up to 95 members by filing one sole application in a selected language and by paying one single registration fee. 

More info on the international filings can be found on: http://www.wipo.int/madrid/en/general/

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Trade mark searches are extremely important and typically designed to determine whether a particular trade mark is available for use on a relevant territory. Trade mark search is an investigation to discover potential conflicts between a proposed mark and the existing ones. Searches help to determine if you can register your trade mark on a relevant territory. The search may identify trade marks that are visually, phonetically, or conceptually the same or similar to the trade mark to be adopted and that cover the same or similar goods or services. The report of searching notes all use of identical or similar marks and the products or services in relation to which they are used. Conducting searches helps to avoid objections and reduces the possibility of infringement of the rights of a prior user or registrant.

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A trade mark registration is performed in a specific area - always in connection with certain products and/or services offered by its owner. The International Classification of Goods and Services for the Purposes of the Registration of Marks (Nice Classification) is an international classification of goods and services - it groups goods and services into thematic classes for the purposes of the registration of trade marks. The heading of each class indicates the products or services included.

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A trade mark with a reputation may be protected from unauthorised use in relation to non-competing goods and/or services. They are protected in case the use of a later trade mark without due cause would take unfair advantage of, or be detrimental to, the distinctive character or the repute of the earlier trade mark. When determining whether a trade mark has a reputation, the following aspects should be taken into consideration:  the duration, extent, and geographical reach of advertising and publicity of the trade mark; the amount, volume, and geographical extent of sales of goods and services offered under the mark; the extent of actual recognition of the mark.

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The wording of the Article 6bis of the Paris Convention and(or) Art. 16(2) of the TRIPS Agreement as well as the Article 4(2)(d)of the Trade Mark Directive refers to a well-known mark. Well-known marks are usually protected irrespective of the fact as to whether they are registered or not. Furthermore, they are protected for goods and/or services which are identical with, or similar to, those for which they have gained their reputation if there is a likelihood of confusion in the relevant sector of the public. In some countries they are also, under certain conditions, protected for dissimilar goods and services.

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The appearance of the product itself or of the packaging of a product is protectable as a three-dimensional trade mark.

Some criteria of examination of the three-dimensional trade mark that consist of the appearance of the product itself are the same as for other categories of trade marks. However, it may be more difficult to come to a finding of distinctiveness. In general, a three-dimensional trade mark that consist of the appearance of the product itself can only be regarded as sufficiently distinctive if the shape departs significantly from the norm or customs of the sector and can thus be perceived as an indication of origin of the goods and/or services.

Additionally, in order to obtain protection, a form/shape must meet the following legal requirements:

- the form/shape must not be necessary to achieve a technical result;

- the form should not be imposed by the nature or the function of the product itself (e.g. the shape of a football for a football);

- the form should not give substantial value to the product (shapes which exclusively realise an aesthetic function, such as the shape of an object of art for objects of art).

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The International Classification of Goods and Services for the Purposes of the Registration of Marks (Nice Classification) is available in its entirety on the website of the World Intellectual Property Organisation.

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In case of prolonged non-use of its mark, the owner may be deprived of its rights. Revocation of a mark is always pronounced by the courts following an application for revocation of the rights of the proprietor. It may be requested by any person if the owner has not begun to exploit its trade mark as it has been registered or has abandoned the use of its trade mark.  Revocation of a mark may be total or partial - for all or part of the goods and services specified in the deposit.

In most countries, a mark will not be so cancelled unless it can be established that there has been at least three years of non-use. In this context, it would be advisable to check the legal position in the country or countries for which the trade mark has been registered. If, however, the owner of a mark can establish that, despite every intention to use the mark, it was prevented from doing so due to circumstances beyond its control, the mark may not be subject to cancellation.

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Trade mark protection is territorial in nature. This means that, provided all conditions are met, such protection will be granted to your name only in the territories in which you have registered it as a trade mark. In other words, registering your name as a European Union Trade Mark only gives you exclusive rights to use that name with regard to specific goods and services (the ones identified in your application) across the European Union only.

For this reason, it is always advisable to develop your trade mark protection strategy in line with your business strategy – that is, to seek trade mark protection in all the countries where you intend to commercialise your products.

If you do not do so, your name or a similar one may be registered by third parties in those countries, possibly for similar or identical goods. Since you will not have exclusive trade mark rights over this name in these jurisdictions, others will indeed be allowed to protect it via trade mark. This might lead consumers in this area to mistake someone else’s products for yours. Commercialising your own product in those jurisdictions under “your” name, but without securing exclusive rights to it, might even in this context constitute an infringement of those third parties’ rights.

Furthermore, even if no-one else registers a name similar or identical to your trade mark in those countries, not having a registered trade mark there means that you will not have any intellectual property rights to that name in these territories. If other entities (such as competitors) copy your products and sell them on these markets under “your” name, you will not be able to enforce any rights (since you will not have any such rights in those territories) and in particular will not be able to exercise anti-counterfeiting actions.

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A trade secret refers to information which meets the following requirements:

  1. it is secret, meaning that it is not, as a body or in the precise configuration and assembly of its components, generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question;
  2. it has commercial value because it is secret; and
  3. it has been subject to reasonable steps under the circumstances, by the person in control of the information, to keep it secret.

The type of information that can be considered as a trade secret is therefore highly diversified, including know-how, technological knowledge, business and commercial data such as lists of customers, business plans, recipes or manufacturing processes. Even though most business information could potentially be regarded as a trade secret, in practice most of it does not need to be treated as such since it has no commercial value. It is therefore important that companies are aware of the information that they consider secret, allowing their effective protection and management.

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Trade secrets are not protected by a specific intellectual property right. Therefore trade secrets do not confer “proprietary rights”, meaning that the holder of a trade secret does not have exclusive rights over the information. Thus, to protect trade secrets, organisations are advised to take measures and implement a range of best practices to make sure that the trade secret is kept confidential.

These measures and best practices include:

  • assessing the company’s valuable confidential information;
  • developing an internal trade secret policy;
  • storing confidential information safely;
  • creating employee awareness of the importance of keeping trade secrets safe;
  • concluding non-disclosure agreements in the case where trade secrets must be discussed with business partners;
  • including non-disclosure clauses within agreements such as licence agreements, consortium agreements or partnership agreements, where the exchange of confidential information is very likely and/or necessary.

 

These measures are highly important since once the information is leaked, others can use it freely since no proprietary right to the trade secret exists.

However, if the information was leaked by someone under the obligation to keep confidentiality, such a disclosure would constitute a breach of contract allowing remedies for the trade secret holder. Moreover, if a person obtains the trade secret by dishonest means (such as in the case of espionage), all countries in the European Union offer some form protection under unfair competition law.

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 PatentUtility ModelTrade Secret
Advantages
  • exclusive right
  • effective tool against imitators
  • protection up to 20 years, which is generally considerably longer when compared to utility models
  • exclusive right
  • effective tool against imitators
  • lower registration costs when compared to patents
  • no registration costs 
  • protection not limited in time
  • no disclosure required
Disadvantages
  • costs for registration can be high 
  • the invention must be disclosed in the application
  • not available in all countries
  • costs for registration
  • shorter protection than patents
  • not available for all kinds of inventions
  • often not an effective tool for product inventions
  • limited remedies available 
  • not easily enforceable
  • can be patented by others 

 

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Non-disclosure agreements, also called confidentiality agreements, are legally binding contracts establishing the conditions under which one party (the disclosing party) discloses information in confidence to another party (the receiving party).

Depending on the number of parties disclosing information, non-disclosure agreements may be “one-way” (also known as unilateral) with one party disclosing information and one party receiving information, or “two-way” (also known as bilateral or mutual) when there is a bilateral disclosure. Whenever the two parties wish to disclose information instead of relying on a “two-way” agreement, it is also possible to sign two unilateral non-disclosure agreements, which may sometimes facilitate negotiations on the drafting of such an agreement. Sometimes you may also see multilateral agreements, with more than two parties involved.

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All types of information can be exchanged under non-disclosure agreements, such as ideas, know-how, descriptions of inventions, chemical formulas, research or business information and negotiations, among others. The common characteristic, however, is that the disclosed information is valuable to the disclosing party to the extent that it must be kept away from the public domain.

In fact, in the European Union several types of intellectual property rights, in particular patents and industrial designs, demand novelty as a requirement for acquiring protection. In most of the EU countries, a creation is considered new if it has not been previously made available to anyone anywhere, unless under confidence obligations. Moreover, some intellectual assets are generally not patentable in many countries of the European Union, such as methods for doing business, and therefore can only be protected if kept out of the public domain. On the other hand, organisations can strategically decide that keeping information confidential is the most appropriate way of protection. Independently of the reason, in all these scenarios, non-disclosure agreements are the recommended tool to use for the purpose of protecting information when it is necessary to transmit it in confidence.

Thus, it is best practice to conclude non-disclosure agreement before engaging in negotiations for licence agreements and R&D projects, or whenever necessary to show innovative ideas, products or technologies to potential business partners or other persons. Confidentiality obligations may also be part of a larger agreement, such as license agreements, consortium agreements and employment contracts.

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In certain cases, having licence rights to a patent will not be enough for the licensee to use, exploit or manufacture the related invention in an efficient way. Beyond the patented innovation, the licensee will in many cases need access to the unpatented technical information which relates to it.

In such cases, instead of a mere patent licence, it may be worthwhile to conclude a “patent and know-how licence” in order for the licensor to grant access not only to its invention, but also to the technical know-how relevant thereto. This will enable the licensee to fully use and understand the invention.

Of course, licensing know-how will only make sense insofar as this know-how has been kept secret, i.e. that there is an economic value to it and a need for the licensee to gain access to that knowledge, which would otherwise not be known nor be readily accessible.

Licensing secret know-how can involve some risks linked to its potential, unwanted disclosure to third parties. For this reason, a patent and know-how licensing agreement should address questions of confidentiality and non-disclosure in a thorough manner, in order to define as precisely as possible the ways in which the licensee can use and further disclose the licensed know-how. The licensee, its staff and relevant third parties (such as possible subcontractors) should be given confidentiality obligations which are, in their scope and strength, at least as stringent as those put into place by the licensor to protect its trade secret.

Finally, special attention should be given to the duration of the intellectual property right being licensed, since the period of the licence cannot exceed the maximum duration of the right (e.g. 20 years for patents). In the case of a patent and know-how licence, this means that the parties should make a clear difference between the patent licence (which cannot last past the expiration of the patent) and the know-how licence (which the parties may wish to keep in force after the expiration of the patent).

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Although an idea - a business information or valuable know-how - is not protectable by specific intellectual property rights, it can still be secured via contractual mechanisms - by setting up confidentiality obligations. When you meet potential business partners you will have to disclose your idea, explain its intended purpose and describe your expectations concerning the future product or service. It is true that once learned information/know-how cannot be forgotten by your interlocutors. Therefore, it is the best practice to ensure that a person to whom you are about to disclose your ideas signs a confidentiality agreement before the meeting starts. The purpose of a confidentiality agreement is to obtain a guarantee that once you disclose information to another party, the latter will not be able to use it for his purposes or reveal it to someone else without your consent, regardless of the fact whether you have agreed on a partnership or not.

Furthermore, any confidential business information (e.g. an innovative idea) which can be of considerable commercial value to businesses and which provides an enterprise with a competitive edge, may be considered a trade secret. You can protect your trade secrets as long as you do not allow the confidential information to flow into the public domain. In other words, you shall safeguard your idea by confidentiality measures including clauses in employee contracts and the aforementioned confidentiality agreements. The unauthorised use of such information by anyone other than the owner is regarded as an unfair practice and a violation of the trade secret. Depending on the national legal regime, trade secrets are subject to the protection provided for in unfair competition, labour, criminal, or civil law, to name a few.

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Utility models can be registered in some countries to protect technical innovations which might not qualify for a patent. The requirements of protection vary from country to country. However, most countries will only grant utility models for products, not for methods or processes. Because the novelty and inventive step requirements are less stringent than those required for patents, utility models can be useful for incremental inventions where only a small change has been made and which might not meet the inventive step requirements for a patent.

Utility models are a more flexible and less costly way of protection of technical inventions than patents. The degree of inventive step is required but in a lower grade than for a patent and the maximum duration of protection is shorter.

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There is no European or international utility model protection. The rules for utility model registrations vary from country to country. Consequently, the requirements for utility model protection will vary depending on the particular national regulations.

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One of the main advantages is that filing a utility model is much cheaper than obtaining and maintaining a patent. The lower costs associated with utility models mean that they could be particularly useful for SMEs. Another advantage is that the utility model is normally granted faster than a patent. The utility model will be easily granted since there is usually no substantive examination (e.g. on novelty.) The inventive step requirements are lower than for patents.

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If a patent application is refused, many countries allow the conversion of a patent application into a utility model application. However, in some countries there is a time limit for doing so.

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Yes, when a European patent is revoked, or when a European patent application is rejected or withdrawn.

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This possibility exists in some countries. For example, in Germany it is possible to obtain and keep both a patent and a utility model for the same invention. If a utility model is branched off from a patent application, the patent application can continue to be pursued to the grant stage as well. However, in other countries, such as Japan and China, only a single right for the same invention is allowed to remain in force.