A patent is an exclusive right granted for an invention, which is a product or a process that provides, in general, a new way of doing something, or offers a new technical solution to a problem. To get a patent, technical information about the invention must be disclosed to the public in a patent application.
In principle, the patent owner has the exclusive right to prevent or stop others from commercially exploiting the patented invention. In other words, patent protection means that the invention cannot be commercially made, used, distributed, imported or sold by others without the patent owner’s consent.
- Exclusive rights – Patents provide the exclusive rights which usually allow your SME to use and exploit the invention for twenty years from the date of filing of the patent application.
- Strong market position – Through these exclusive rights, you are able to prevent others from commercially using your patented invention, thereby reducing competition and establishing yourself in the market as the pre-eminent player.
- Higher returns on investments – Having invested a considerable amount of money and time in developing innovative products, your SME could, under the umbrella of these exclusive rights, commercialize the invention enabling your SME to obtain higher returns on investments.
- Opportunity to license or sell the invention – If you chose not to exploit the patent yourself, you may sell it or license the rights to commercialize it to another enterprise which will be a source of income for your SME.
- Increase in negotiating power – If your SME is in the process of acquiring the rights to use the patents of another enterprise, through a licensing contract, your patent portfolio will enhance your bargaining power. That is to say, your patents may prove to be of considerable interest to the enterprise with whom you are negotiating and you could enter into a cross licensing arrangement where, simply put, the patent rights could be exchanged between your enterprise and the other.
- Positive image for your enterprise – Business partners, investors and shareholders may perceive patent portfolios as a demonstration of the high level of expertise, specialization and technological capacity within your company. This may prove useful for raising funds, finding business partners and raising your company’s market value.
In many cases, where an enterprise has merely improved an existing product and the said improvement is not sufficiently inventive to be deemed patentable, utility models (or “petty patents” or “utility innovations”) may represent a good alternative, if available in the country in question. On occasions, it may be advisable for your SME to keep its innovations as trade secrets which requires, in particular, that sufficient measures are taken to keep the information confidential.
It is highly advisable for SMEs engaging in inventive activities to consult patent databases to find out about existing technologies, identify licensing partners in case a technology already exists and avoid duplication of research activities. A more comprehensive analysis of the importance of patent searches is available.