As a startup, it is essential that you safeguard your innovations to achieve success. There are various legal frameworks in Australia that offer avenues for you to protect your intellectual assets, such as trade marks, patents and copyrights. Furthermore, you should also know when to invest in intellectual property (IP) and when to hold back. This will ensure that you have grounds to enforce your IP rights and prevent infringement properly. This article will explain the different types of IP as well as the benefits of investing in IP protection early.
What are the Different Types of Intellectual Property?
You should consider the four types of IP and the different fees involved in registering it with IP Australia. Importantly, not all types of IP protection may apply to your startup and it depends on the nature of your assets. Ultimately, having a clear understanding of what protection each IP affords will be imperative to ensuring effective brand growth and value creation.
Trade Marks
A trade mark is a sign or symbol used to distinguish the goods and services of one business from another. Typically, startups apply to register the brand name and logo as their trade marks. The main benefit of trade mark registration is that it will provide you with exclusive rights to use the mark Australia-wide for your goods and services. These rights last for 10 years before you must renew them again. Crucially, you should remember that your business name, company name or domain name does not provide these same exclusive rights. Accordingly, you should conduct a trade mark search before registering a new business or company name to ensure your name does not infringe on an existing trade mark.
You must also be aware of the costs involved in registering a trade mark. These costs will depend on the breadth of protection you are seeking, as well as how many classes you apply for and if you file a standard or bespoke application.
This guide explains the essentials of trade marks and the steps required to register a trade mark.
Copyright
Copyright is a type of automatic IP protection and is governed by the Copyright Act 1968 (the ‘Act’). This type of IP protection concerns your original expression of ideas through works such as:
- images;
- film;
- art; or
- articles or other written pieces.
You should note that copyright does not protect the underlying idea itself, and there must be a tangible expression of your idea. For a startup, copyright may apply to website content and software source code. In order to be protected under the Act, a work must be original, recorded in material form and connected to Australia.
Patents
A patent protects new inventions. Here, ‘newness’ is based on factors such as:
- novelty;
- lack of public disclosure; and
- commercial potential.
A key right you will have under a patent is the exclusive right to commercially exploit the invention for the patent’s duration. You can apply for a patent to protect a number of inventions, including computer-related inventions, business methods and mechanical devices.
However, you should note the legal barriers to gaining patent protection. In particular, startups must comply with the Intellectual Property Laws Amendment (Raising the Bar) Act 2012, which requires applicants to prove they significantly advancing what is already in the market. Similar to trade marks, patent registration costs can also vary depending on the breadth of protection you are seeking.
Trade Secrets
Sometimes a trade secret will be more valuable and affordable than a patent. If you can maintain its secret status, it will also have a longer life span than a patent. It may be more valuable to your startup to get your product on the market quickly rather than going through the process of patent protection. As a result, trade secrets may be more valuable if you cannot afford a patent registration and have not tested the gap in the market. In these cases, you should keep your invention a secret until more investment opportunities present themselves.
What Are the Benefits of Registering IP for a Startup?
Investors in the technology industry tend to view startups more favourably when they take measures to safeguard their IP. By registering your IP, you not only gain a competitive edge but also open up the possibility of earning income through licensing fees. Moreover, if your startup is looking to secure funding from investors or is planning to sell, you must register your IP. This step provides potential investors with a sense of assurance while they evaluate investing in your business.
Should Startups Use Confidentiality Agreements?
If you want your employees and contractors to keep your work confidential, you can ask them to sign a confidentiality agreement. Generally, the agreement outlines that they will not share your IP with anyone, even after they stop working for you.
However, it may not be a good idea to ask investors to sign the same agreement. This is because it may make investors perceive you as difficult to work with. Investors are also more focused on finding profitable ideas and entrepreneurs to invest in, so the likelihood of getting your idea stolen is low.
Key Takeaways
As a startup, failing to register or monitor the use of their IP runs you the risk that someone could copy your brand or products. This results in significant financial and time-based issues, especially after you have invested considerable time and money into them. As a result, you should create a well-documented, clear chain of title to all the intellectual property in the venture and determine whether anything should be registered with IP Australia. To do so, be discerning about what types of IP you choose, including;
- trade marks;
- copyright;
- patents; and
- trade secrets.
Understanding the scope of protection will also allow you to invest in effective protection strategically.
If you would like assistance with protecting your IP as a startup, contact our experienced intellectual property lawyers as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.
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