MSMEs urged to protect intellectual property assets

Micro, small and medium enterprises (MSMEs) are encouraged to protect their intellectual property (IP) assets to overcome uncertainties during the pandemic.

“We have seen how in the long term a fast and responsive IP system could create a positive multiplier effect into the society, adding value to business, providing livelihoods, spurring innovation and creativity, and boosting economic growth,” Intellectual Property
Office of the Philippines (IPOPHL) director general Rowel Barba said in a webinar.

Barba said that despite these benefits, the awareness on IP remains low among MSMEs as they think the application process might be too complex or expensive in a way that it might not reap enough rewards to return the expenses.

“So our ultimate goal is to create the paradigm shift that MSMEs think of IP not as a cost but an investment, a long term investment because it is,” he added.

Michaela de Castro, information officer at IPOPHL Documentation, Information, and Technology Transfer Division (DITTD), said IP is an asset that can increase the market value of a business, adding it can be sold, assigned, transferred, commercialized, licensed, franchised, and can even be a security/collateral for loans.

She said types of IP that can be legally protected include patents, utility models, industrial designs, copyright, and trademarks.

“Copyright (is) protection for the owner of the rights to an original work, literary and artistic. It is automatically granted to the author upon creation and deposit with IPOPHL or the National Library is optional but highly recommended, highly suggested if you have a copyrighted work,” she added.

De Castro said there is no need to file an application to register trade secrets which include manufacturing, industrial, or commercial secrets.

Jalyza Maye Jalbuena, university extension associate at UPLB Technology Transfer and Business Development Office, underscored the importance of IP audits to the MSMEs.

“It helps a business make an inventory of its IP assets so we can know how we use them, who owns them, if we are infringing the rights of others, or if our rights are being infringed by other individuals or businesses,” she said.

Jalbuena particularly cited companies engaged in the business of clothing, shoes or other luxury items which need to ensure they use their own design for their products.

“We can actually protect it so that other businesses or other individuals cannot copy our designs and at the same time, if we are copying or using the designs of other individuals or other businesses, we have to make sure that we are licensed to do us because if not, we might be charged with IP infringement, same goes using popular brands of existing merchandises…,” she said.

Jalbuena said an IP audit team with an understanding of product/service lines, relevant business environment, and future plans of the business conducts the audit.

It is also optional to have an external expertise especially if the internal team does not have enough knowledge on IP management, she said.

“You have to conduct an audit to make sure that before expanding, you actually have a legal right to sell in that international market,” she added.

Atty. Augusto Bundang, legal counsel for Association of Advertising Agencies of the Philippines, also cited the importance of IP and trademark licensing.

Bundang said IP licensing is the grant of permission to licensee by a licensor who has the exclusive rights over certain IP in exchange for a consideration.

On the other hand, trademark licensing is an arrangement whereby the owner of a trademark grants permission to another to use its trademark in exchange for payment under certain terms of conditions, he said.

“The way to acquire rights (over the trademark) under the IP Code now is through trademark registration, That’s the general rule so very important that you register your trademark otherwise, what is the licensee or the franchisee getting from you if eventually there is no brand value to your product or service,” Bundang said.

“Another point to consider: it is a tool for brand expansion. So if you are in Metro Manila for example doing your business, you are able to come up with the licensing arrangement or a franchising arrangement to the franchisee in Mindanao and the Visayas, you don’t need to put up your store there. Your licensee or your franchisee will take care of that. So you have expanded your brand, you have expanded your business without even spending a single centavo,” he added.

Bundang said licensing is still very important at this time.

“There are a lot of you saying that business slowed down but there are a lot of businesses that are picking up.. So it’s still very relevant if you want to consider expanding your business, it is still a very good platform to use in order to engage in your business,” he said.

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