The value of an idea should never be underestimated. An idea is where all businesses start, whether they stay small and flourish as a micro-enterprise or transform into a global household name. Even the ideas that don’t succeed are invaluable because they teach us lessons and steer us toward the right path.
Every sale you make and every penny of profit you achieve all started with one spark of an idea. In legal terms that idea is known as your Intellectual Property (IP).
In this blog post we’ll be exploring why it’s so crucial to protect your IP and your creative assets at all costs, covering:
- What Intellectual Property actually is
- Why it’s so important to protect IP
- At what point you should protect an idea
- The best ways to protect your business ideas
- What to do if your IP has been infringed
What is Intellectual Property?
Intellectual Property is anything original that you create. This could be anything from music or artwork to software or a product invention – and so many more things in between. It also includes your business name, logo, products, or services.
Owning IP makes sure that it’s only the creator(s) who can legally profit from their work by preventing other people or businesses from using it unlawfully.
There are a number of ways you can protect your work – your IP – and we explore each of these in more detail further down.
It’s important to note here that an idea on its own is not generally considered to fall under the IP umbrella. Something becomes Intellectual Property when it becomes more tangible.
Why it’s so important to legally protect your IP
There are a number of reasons why protecting your IP and creative assets is so important, including:
- Safeguarding your income and preventing anybody from profiting off your ideas without your explicit permission.
- Shielding what helps you stand out from the competition and preventing your competitors replicating whatever brings you success.
- Helping you avoid costly legal action further down the line if you find yourself in a situation where your IP has been infringed. It’s much better to prevent a problem than to have to deal with its consequences.
At what point should you think about protecting an idea?
In general, it’s important to think about protecting your ideas and your IP as soon as possible. The point at which you can do this very much depends on the circumstances.
If you’ve just got an idea for a business that hasn’t started trading yet, applications for IP protection aren’t typically accepted. So, if you’re wanting to safeguard an idea for further business development later on, you might consider:
- A Non-Disclosure Agreement (NDA) so that you can talk to other people about your idea, but they can’t disclose it elsewhere
- Setting up a company (and leaving it dormant) so that it can ‘hold’ your IP until you’re ready.
If you’re looking to protect a practicing idea or creative asset for a business that is already trading, on the other hand, you should do so sooner rather than later. So, if your business is registered and you’re ready to start trading, there’s no time like the present to start protecting your IP.
The best way to protect a business idea
When it comes to safeguarding your ideas and Intellectual Property, there are a number of routes you can take, depending on the nature of your asset(s).
Non-Disclosure Agreement (NDA)
If your business isn’t trading yet and your idea isn’t in practice, the best way to protect yourself is with NDAs. That way, when you’re discussing your plans and ideas with anybody, they’re under contract not to discuss or share them without your permission.
If you’re talking to a client or a supplier about your idea, for example, you can get them to sign an NDA to keep your plans under wraps.
Patent
Patents are most commonly used to protect inventions. A patent gives the inventor exclusive rights, granted by the government, which mean nobody else can replicate, sell, or make money from that invention.
There are two different types of patents:
- Utility patents (the way something works)
- Design patents (the way something looks)
Both types require the inventor to go through a rigorous application process to check criteria. If an invention is just a modification of something that already exists, for example, a patent cannot be granted.
Top tip: Patents are only applicable in the country which grants them, so always try to secure a Worldwide Patent wherever you can.
Trademark
Trademarks are most commonly used to protect a business’s brand. They can cover elements such as a company name and logo, and sometimes even specific words and colours. Trademarks are designed to protect your business’s unique identity by preventing others replicating it too closely.
Once you have a trademark in place, you can start using the registered (®) symbol to demonstrate that your IP is protected. As with patents, trademarks only apply in the country which grants them, so it’s vital to apply for trademark registration anywhere you plan to do business.
Copyright
Unlike trademarks and patents, you don’t actually apply for copyright. Instead, copyright applies automatically to any original works or ideas that have been expressed.
The following assets are automatically protected by copyright, meaning you don’t need to take any action:
- Original literature, drama, music, and art
- Sound and music recordings
- Film and TV recordings (including broadcasts)
- Original illustration and photography
- Original software, web content and databases
- Original layouts
You can – and should – mark your creative assets with the copyright symbol (©) to indicate the protection. This isn’t a legal requirement and not using the symbol won’t impact the copyright protection, but it is best practice.
Copyright expires after a certain period of time so make sure you do your research to ensure your ideas stay secure. Most copyright is in place for 70 years but there are some instances where this is much shorter.
You can license or sell your copyright to third parties via a legal contract that passes usage rights over to them. You can then start reaping the rewards of royalties. To do this, you’ll need to register your work with a licensing body.
Trade secret
Trade secrets conceal confidential business information from the public domain. This could be a formula, a process, a technique, or even a secret recipe that you don’t want the world to know about.
You cannot officially register a trade secret and instead they’re protected by common law under the law of confidence. However, this is where Non-Disclosure Agreements come back into play, to prevent anybody sharing your secrets unlawfully.
What to do if your Intellectual Property has been exploited
1. Take a deep breath and sleep on it
Any correspondence you have with somebody regarding infringement can be used in legal proceedings, so be mindful about what you say or do in the heat of the moment.
2. Issue a cease-and-desist letter
This should outline the problem and how you wish for it to be resolved, as well as detailing all of your IP rights.
3. Negotiate a resolve amongst yourselves
Sending a cease-and-desist letter will, hopefully, be enough for you to come to an agreement without the need for legal support. In most cases an IP violation will be an honest mistake which you can quickly resolve. You can also ask someone to mediate on your behalf if you prefer.
4. Seek legal advice
If step 3 doesn’t solve the problem, it could be time to take further legal action. A solicitor will be able to assist you but just be aware of the potential costs before committing to anything.
Can an accountant help me with IP?
Navigating Intellectual Property protection can seem daunting so if you’re feeling overwhelmed don’t worry, you’re not alone. Whilst they might not offer legal advice per se, accountants can help you deal with the financial impact it might have on your business. They can also help you set up a limited company to offer your ideas more legal protection.
So, if you’re looking to protect your business, speak to an accountant who will be able to help guide your strategy and finances. They’ll also be able to advise you on what level of protection best suits the various elements of your business and its Intellectual Property.
Find more help and accounting support in our online hub, or learn more about finding an accountant.
