Business Law & Compliance

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UK industry has opened the door to R&D collaboration, but IP risks must not be overlooked

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Based on a Withers & Rogers survey of 70 professionals with responsibility for IP management within innovative, UK-based businesses, the majority (81 per cent) are actively collaborating with third parties, such as supply chain partners, as part of their R&D processes. Almost half of respondents (46 per cent) also said they are keen to collaborate more in the year ahead.

Karl Barnfather, chairman at Withers & Rogers LLP, said: “This willingness to collaborate is certainly positive and is helping to position UK industry at the forefront of the economic recovery. However, such activities can lead to increased risks if commercial interests are not properly protected.

“The point of disclosure is a critical moment for innovators as once an invention or idea is shared with a third party (even as part of a collaboration with a single supply chain partner) it may be too late to protect it, as a competitor could claim it represents ‘prior art’.

“Undoubtedly, opening the door to more collaborative R&D, can help to create commercial opportunities, particularly in situations where there is proven market demand, however, it is vital that technologies and processes are protected by a confidentiality agreement from the start. By doing so, the technology behind the innovation is protected, giving the rights owner the potential to leverage value from it in the future by licensing it to third parties.”

The research also indicates that a third of innovation-led businesses have changed their approach to IP in direct response to the introduction of Patent Box in April of last year. This tax relief, which is payable on the profits earned from innovations protected by a UK or European patent, has led to a significant increase in the volume of patent applications, and there are likely to be more to come.

According to the research, 89 per cent of innovation-led businesses revealed that their R&D spend is rising, and half (49 per cent) confirmed that they are doing more to protect their IP. The vast majority (92 per cent) also stated that there is a clear culture of innovation within their organisation, with more than half (57 per cent) confirming that IP matters are on the board room agenda.

While the survey identifies some positives, there are also areas for potential concern. For example, the number of businesses that say they are unsure about whether they are adequately protected against staff taking important IP knowledge with them if they leave (36 per cent). Worryingly, 49 per cent stated that within their businesses there was insufficient knowledge of IP and its value for the organisation as a whole. This understanding must be increased if risks are to be reduced.

Barnfather added: “Awareness of intellectual property rights and the commercial benefits they can bring for UK industry is gaining recognition. Patent Box is definitely part of the reason for this, as is a tentative move by the banking sector to support the growth of IP-rich businesses. However, it also comes down to innovative businesses being more willing to work together to develop products and services that the market wants to buy.”

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