Reading time: 5 minutes

Note from August 25 2021, the innovation patent will cease to exist. After this date, you can only file a divisional innovation patent if it is based on a previously filed patent. Read more about this change in our article.

In today’s economy, intellectual property (IP) is one of the most important assets of any business. In some cases, you are even able to make money off your IP. There are various forms of IP rights which can be afforded protection, including:

Your IP is what sets you apart from your competitors and adds value to your business. This article explains the important role that IP rights can play to make your business more money. 

Exclusive Use of Intellectual Property

As the owner of any form of IP, you are afforded the exclusive right to use these assets and prevent others from using anything substantially similar. This means that other traders are unable to use, for example, your trade mark or copyrighted material and profit off your hard work. Further, the exclusive right to IP adds value to the specific products or services that you provide. It also enhances the value of your business as a whole.

The exclusive rights awarded differ depending on the specific type of IP:


If you create an original work, you are afforded automatic copyright protection once you express that work in a material form.

For example, if you have an idea for a book, it does not receive copyright protection until you begin to write it down.

The automatic right to copyright protection lasts for your lifetime and 70 years after your death.

As an owner of copyrighted material, you have the exclusive right over your work to:

  • reproduce it;
  • communicate it the public;
  • publish it;
  • perform it; and
  • adapt it.

Trade Mark

A registered trade mark is a beneficial marketing tool for your brand that you can use to promote the goods or services that your business provide. A registered trade mark provides you with ten years of protection which you can renew.

With a registered trade mark, you can advertise your brand without the fear that other people will steal your registered:

  • name;
  • slogan;
  • logo; or
  • image.

The exclusive use of a trade mark means that you can prevent others from using the same or similar mark within the same industry as your business.


The type of patent that you hold will determine the duration of protection afforded. For example:

  • innovation patents receive protection for up to eight years;
  • standard patents receive protection for up to 20 years; and
  • pharmaceutical patents receive protection for up to 25 years.

As the owner of a patent, you have the right to stop others from manufacturing and selling your invention without your permission. You can generate money from your invention by providing an exclusive licence to manufacturers.

Commercialising IP

Another advantage of having the exclusive right to use your IP is that you can decide how you would like to commercialise these rights to grow your business. There are two common ways to make money off your IP.

1. Assigning or Selling your IP

Assigning or selling your IP involves a permanent transfer of the specified IP assets to another individual or business. When looking to sell your business, the sale value can increase if you have a valuable IP. This is much like how a tangible investment increases the sale price of a business. 

Assigning your IP to another party means that you will no longer have the exclusive right to use the IP. Therefore, you can request a payment for the assignment of the IP which reflects its market value.

It is important to note that as IP is treated as an asset for tax purposes, any revenue that it generates can trigger tax obligations. We recommend that you seek tax advice before selling your IP and decide on the best option for your business.

Assigning IP rights can also incur within your business.

For example, many businesses assign their IP to a holding company to increase the value of the business. Further, it protects the IP through a dual company structure.

2. Licensing

As the owner of IP (licensor), you can licence your IP to a licensee in return for some form of consideration. Licensing IP means that you will still retain ownership and control of the IP. However, the licensee can use the IP in a specific way.

IP Licence agreements are commonly found in franchise arrangements. Here, the franchise company will licence the IP rights and business model to the franchisee to ensure brand consistency. The relationship of an IP licence should be governed by the terms of a licence agreement.

Common terms of a licence agreement include the:

  • permitted use of the IP;
  • type of licence;
  • territory where the IP use can be exercised;
  • term of the licence;
  • agreement on whether the licensee has any right to sub-licence; and
  • payment for the licence.

The type of IP licence can be either:

  • an exclusive licence, where the licensee has the right to use and commercialise the licensor’s IP to the exclusion of all others;
  • a non-exclusive licence, where the licensee has the right to use the IP alongside anyone else who the licensor grants licences to;
  • a sole licence, where other licensees cannot use the IP, but the licensor can use their IP.

Key Takeaways

Your IP is a valuable asset and can allow your business to grow and be profitable. Given the value that IP rights can add to your business, it is always important to consider the various options available. Assigning or licensing your IP involves a lot of different legal considerations that you will need to be aware of. If you have any questions or need an IP licence or assignment drafted, contact LegalVision’s IP lawyers on 1300 544 755 or fill out the form on this page.


Construction Contract Essentials

Thursday 12 August | 11:00 - 11:45am

Understand how construction contracts are drafted and how to protect your construction business.
Register Now

Startup 101: Understanding Cap Tables and ESOPs

Thursday 19 August | 11:00 - 11:45am

Cap tables and employee share option plans are essential for fast-growing startups. Learn more with this free webinar.
Register Now

Expanding to NZ: Structuring Your Business For Success

Thursday 26 August | 2:00 - 2:45pm

Launching a business in New Zealand? Understand how to structure your business for success with this free webinar.
Register Now

Preventing Modern Slavery: Your Business’ Legal Obligations

Thursday 9 September | 11:00 - 11:45am

Are you an Australian business with $100m+ annual consolidated revenue? Learn how to determine if you are a modern slavery reporting entity and your obligations under the legislation with this free webinar.
Register Now

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. From just $119 per week, get all your contracts sorted, trade marks registered and questions answered by experienced business lawyers.

Learn more about LVConnect

Need Legal Help? Get a Free Fixed-Fee Quote

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

  • 2020 Excellence in Technology & Innovation – Finalist – Australasian Law Awards 2020 Excellence in Technology & Innovation Finalist – Australasian Law Awards
  • 2020 Employer of Choice – Winner – Australasian Lawyer 2020 Employer of Choice Winner – Australasian Lawyer
  • 2021 Fastest Growing Law Firm - Financial Times APAC 500 2021 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review 2020 AFR Fast 100 List - Australian Financial Review
  • 2021 Law Firm of the Year - Australasian Law Awards 2021 Law Firm of the Year - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer