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COMMERCIAL ASPECTS OF Intellectual Property Rights
“Exclusive rights granted by the State for inventions,
new and original designs, trademarks, new plant
varieties and artistic and literary works”.
© ®™
Intellectual Property Rights
The right to prevent others from• using• manufacturing• distributing products processes applications trade names geographical names ideas designs
Industrial Property Rights
Intellectual Property Rights
Patents
Trade marks
Geographical denominations
Industrial designs
Copyright
"Copyright" is a protection that covers published and unpublished literary, scientific, and artistic works, whatever the form of expression, provided such works are fixed in a tangible or material form.
This means that if you can see it, hear it, and/or touch it-- it is protected.
Anything tangible – in a fixed form Examples
Literary works, including software Musical works, including accompanying words Dramatic works, including accompanying music Pantomimes and choreographic works Pictorial, graphic and sculptural works Motion pictures and other audiovisual works Sound recordings Architectural works
Works that have not been fixed in a tangible form of expression; for example, improvisational speeches or performances that have not been written or recorded.
Titles, names, short phrases and slogans; familiar symbols or designs; variations of typographic ornamentation, lettering or coloring; listing of ingredients or contents.
Ideal procedures, methods, systems , processes, concepts, principles, discoveries, or devices, as distinguished from a description, explanation or illustration.
Everything on the Internet is copyrightedWorld Wide Web pagesCoursesElectronic mail, listservs and newsgroups
The same copyright laws apply to electronic materials as to print materials
PATENT TRADE MARK
Validity of protection
when and where registered
when and where registered
Refers toproducts processes
applications
names, logo, shape, symbol, color, domain
Criterianovelty, level of inventiveness
no confusion, generic name
EU registrationEU patent office
Munich, GermanyOHIM
Alicante Spain
Website www.epo.orghttp://
oami.europa.eu
Duration20 years, not renewable
6-10 years, renewable
YEARS RENEWABLE
Patents 20 (6) No
Trade marks 6-10 Yes
Designs 6-10 Yes
Copyright70 after
deathNo
Trade marksName
Logotype
Symbol
Slogan
Shape
Color
Registration of trade marks
NATIONAL REGIONAL INTERNATIONAL
FEESNational fees for each country
National fees for each countryor EU fees
One fee
LANGUAGETranslation into national languages
One language One language
WHEN
May be convenient if limited number of countries or no alternative
For EU market If protection in more countries is needed.
Not allowed / not valid
• Violation of public order and morale
• Copy of earlier registration (bad
faith)
• Withdrawal from register
• Not in use ( 5 years)
• Evolution into generic name
• Formica, cellophane, compact
disc
Common mistakes
• Believing that trademark protection is universal
• Using a trademark that is already registered or is being used by competitors in export market (Nike, Olympics 1992)
• Using a trademark that conflicts with a protected geographical indication (South African winegrowers – “Champagne”
• Leaving the ® sign on a product even when exported into a country where it has not yet been registered
“The right to exclusively produce, use and/or market a
• Product• Process• Application
Patents
Extremely complex because of its criteria,
Result of too many funny/weird applications :
• Novelty, not publicly known Boomerang
• Product/process/application Aspirine
• Industrial, not software: Copyright
• Level of “inventiveness” Cashmere
brush
• Applicability Mars-shoes
Patent legislation
Registration of patents
NATIONAL REGIONAL
WHERE
Each country where you seek protection (through EPO website) or through national patent office in your country
European Patent Office www.epo.orgUS Patent Office www.uspto.gov
FEESNational fees for each country
National fees for each countryexcl. Benelux
LANGUAGETranslation into national languages
One language
WHENMay be convenient if limited number of countries or no alternative
For EU marketFor US market
Patents• product, process, applications• Registration :difficult to prove “novelty”• limited duration
Trade mark• name, symbol, shape• Registration : do not create confusion• renewable
IPR: only protection when registered (excl. copyrights)
In a nut shell
19
Contents
Licensing of IPRs Royalty on Technology Transfer and IPRs Holding of IPRs in tax efficient manner Auction of IPRs Role of IPRs in Venture Capital Business Growth & Valuation Enhancement
Copyright and Fair UseDo you have the right to use other people’s
material in your course?
Intellectual PropertyWhat happens to the intellectual material once
you have posted it online?
What can you do if material is used without
authorization
21
Licensing of IPRs
Important issues in software licensing
• Define Licensor & Licensee• Software Description• Term of License• Expiry / Termination • Renewal• Upgradation • Single or Multi-user• Concurrent User• Network in which it is to be used
22
Licensing of IPRs
•Home or Commercial use•Access to source code•Transferability•Division of Components of Software•Downloading & uploading•Sub-licensing•Operating Systems for software•Non Liability through wrong usage•Anti Piracy clause
23
Licensing of IPRs
•Software Auditing
•Remedies - damages / injunction /
criminal liability
•Liability & Obligation of Licensee
•Territory
•OEM unbundling
•Royalty
•Taxation
•Repatriation
24
Royalty on Technology Transfer and IPRs
Royalty can be
Lump-sum fee percentage of sales
25
Royalty on Technology Transfer and IPRs
Royalty for Technology (Patents)
o Lump sum payments upto $ 2 mn
o Upto 5% for domestic sales and 8% for exports, without any restriction on the duration of the royalty payments.
Royalty for use of TM and brand can be paid upto 2% on exports and upto 1% on domestic sales.
26
Royalty on Technology Transfer and IPRs
o Define Technology and List of IPRso Grant of Licenseo Rights & Obligations of Licensee and Licensoro Exclusive / Non-exclusiveo Transferability and Sub-licensingo Termo Revocabilityo Territoryo Advertising & Promotiono Audit of accounts from outside agencyo Royalty Payment and Calculation
Issues in Technology Transfer
27
Role of IPRs in Venture Capital
Venture Capital (VC) has been major drivers of innovation, economic growth, knowledge base industry and start ups. VC industry follow the concept of “high risk high gain.”
VC value intangible assets while making equity investments, which generally conventional sources of financing may not consider.
28
Role of IPRs in Venture Capital
Increases the valuation of the company
Better IPR portfolio gives competitive edge in attracting VC
29
Business Growth & Valuation Enhancement
“IPRs being intangible assets forms substantial part of assets of a company and thus increase the valuation“
“IPRs helps in expanding the market share and venturing into new markets and businesses“
Advantages and Disadvantages of IPR