Investment in IP protection vital for MSMEs in e-commerce era

Micro, small and medium enterprises (MSMEs) should look into investing in intellectual property (IP) protection as they grow their businesses and expand their markets in the era of e-commerce, as not giving this priority could have unfortunate consequences.

Carissa Cruz-Evangelista, founder-member of the Philippine Fashion Coalition advises MSMEs to earmark some budget for IP protection and register their brands.

Speaking in a webinar, she noted that IP protection often takes a back seat to companies’ other priorities like staff salaries and product marketing and development.

“But now with e-commerce on the rise we also have the threat of more counterfeiting and we need to have an IP protection budget both for smaller and bigger brands,” Evangelista said.

When you have weak IP protection, growth is difficult to achieve, she said in her presentation at the e-forum organized by the Intellectual Property Office of the Philippines (IPOPHL).

As a cautionary tale, Evangelista cited instances in the fashion industry where designers have been locked out of their own rights to their creations and cannot expand overseas because they were not able to register for IP protection.

At the same time, she called for increased checks and balances to provide stronger protection for IP rights and contain the proliferation of unauthorized online sellers.

She said e-commerce platforms with presence in the Philippines should also do their part in helping IPOPHL police counterfeiting, as online piracy has now grown into a huge global industry.

Evangelista pointed to European e-commerce platforms, for example, which she said now provide space for IP units on their sites.

She also pressed for more teeth to legislation on IP rights, observing the difficulty in preventing counterfeiting of uniquely Filipino products such as indigenous textiles.

The entrepreneur also recommended that government consider giving more incentives and assistance to MSMEs. She said many sunrise industries, such as the creative sector, need additional support to successfully move up from the infancy stage.

Evangelista likewise suggested looking into the concept of “soft power” in the promotion of Philippine products in foreign markets. Soft power is defined as the ability of a country to persuade and influence others, as opposed to using coercion or force to achieve their goals.

She said an example of a country that effective uses soft power is South Korea, which takes an integrated approach to selling by incorporating and showcasing their products and culture in Korean drama shows.

At the same online forum, trade officials underscored the need for MSMEs to register their trademarks, especially in this innovation economy.

“IP protection should be at the forefront of MSME business strategies more than ever,” said Department of Trade and Industry (DTI) Undersecretary Abdulgani Macatoman.

“With the overwhelming use of the Internet, intellectual property plays an important role in e-commerce as it safeguards the business interests of a company or an individual against unfair competition.”

He added that IP protection also helps validate creativity and protect product innovation and brands as MSMEs scale up their operations and expand their markets.

IP rights help safeguard and maintain the secrecy of trade activities “while providing the actual share of profits to the IP right owners,” he further remarked.

DTI Assistant Secretary Mary Jean Pacheco echoed the importance for MSMEs and brand owners to copyright and register their trademarks and brands.

She noted that global e-commerce revenues are projected to see an additional growth of 10% in 2020, as she encouraged MSMEs to avail of all this potential for growth and “put their brands out there.”

“COVID or no COVID, e-commerce is here to stay,” she said.

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