Nurturing Innovation: IP Offices and SMEs

Small- and medium-sized enterprises are crucial to the global economy, though many do not understand the importance of intellectual property. Rory O’Neill looks at how IP offices are helping to change that.

According to the Organisation for Economic Co-operation and Development, small- and medium-sized enterprises (SMEs) make up 99 percent of all enterprises in its 36 member states. It is clear that SMEs, including researchers, manufacturers, and retailers, are the heartbeat of the global economy.

Yet, do these enterprises have the knowledge or the resources to protect their IP effectively? This is a challenge that IP offices around the world have been forced to grapple with in order to ensure that innovation in the economies they serve is properly protected. While there is no one-size-fits-all approach, examining the different ways in which IP offices around the world are trying to enable SMEs to better protect their IP can shine some light on best practices.

Africa

The African Regional Intellectual Property Organization (ARIPO), an inter-governmental organization, has led the way in developing new pathways to IP knowledge and services for the continent’s SMEs.

Director General Fernando Dos Santos acknowledges that there is a lot of work to be done in eductating SMEs. “While they are either using or creating intellectual property daily, the reality on the ground is that most of these enterprises have not the slightest idea about intellectual property,” he says. 

Yet, he says, “Most of the African countries’ industry and employment is driven by SMEs.” Teaching SMEs how to harness and monetize their IP effectively is therefore a priority for ARIPO. Yet the landscape is a difficult one. 

Many countries in the region are still grappling with the legacy of the past. “We still have states that are operating under outdated legislation dating back to the colonial era,” Mr. Dos Santos notes. An important priority for ARIPO is overcoming the disparities in various countries’ legal regimes and achieving greater harmonization across the continent in IP policy. Yet Mr. Dos Santos says that, at present, the level of political will to adopt ARIPO protocols into national law is “low.”

It is in this context that the level of knowledge on IP and its benefits is not what it could be. 

“Most of the African countries’ industry and employment is driven by SMEs.” Fernando Dos Santos

Mr. Dos Santos says that ARIPO has adopted a “multifaceted approach” to overcome these challenges. Among the most successful measures has been its “roving seminars” delivered in various member states. In 2018, the organization delivered the seminars in five countries, attracting 450 participants.  The current round of seminars is focused on universities and research and development institutions, and is centered on the theme, “fostering creativity and innovation for economic growth and development in Africa.” 

So how successful have these been? While, as Mr. Dos Santos notes, the success of these seminars is measured mostly in the long term, he has observed an immediate impact. For example, he says, “We tend to record heightened activity in registration of IP rights after training.” This activity comes mostly in the form of registration of utility models, designs, and trademarks.

ARIPO also receives positive feedback from attendees at the seminars, including those who have called for the inclusion of participants from a greater variety of sectors in which SMEs are active. “So far, trainees have always expressed satisfaction and have, in fact, appealed for more training,” Mr. Dos Santos says. 

Australia

According to Andrew Mackay, Acting General Manager of the People and Communications group at IP Australia, the country’s national registry office, “IP is often seen as a luxury for many SMEs.” IP Australia has found it difficult to “cut through with key messages in an already loaded business advice ecosystem.”

It doesn’t help, Mr. Mackay says, that the level of understanding of IP in Australia is “quite low” compared with that of countries such as the United States. To help overcome this challenge, the Office has made educating small business owners a priority.

Given  Australia’s large geographical scale which makes running traditional face-to-face seminars both logistically challenging and expensive, he notes,  IP Australia has adopted an innovative approach: what it calls a “digital first” policy.

To this end, the Office has devised a toolkit for SMEs to access online, accompanied by a digital assistant to help navigate the function. The toolkit, Trade Mark Assist, allows users to check whether their trademark applications are in compliance with legal requirements and are likely to be approved for registration. The service is aimed in particular at smaller companies that are filing without the services of an attorney.

In 2017, IP Australia also introduced a webinar program specifically aimed at educating SMEs across the country. Currently, the webinars are built around four content modules which seek to demonstrate the basics of IP and its relevance to small business.

Underpinning all of this work is IP Australia’s conviction that better educating small business owners on the importance of IP is essential to the country’s continued economic development. Notes Mr. Mackay:  “The IP system is key to enabling an innovative and internationally competitive business environment, and with so many Australian businesses falling into the SME bracket it’s crucial they are involved.”

Peru

Indecopi, the Peruvian IP Office, has taken steps to make its system of trademark filings as accessible as possible online, with a free app, PeruaNIZAdo, for searching the appropriate class of interest for a mark. Also at no cost, Indecopi offers electronic publication of trademark applications, a Trademark Advisory Service to answer basic queries on the registrability of a given mark, and advice on applications. 

Ray Meloni García, Director of Distinctive Signs at Indecopi, explains that these activities help SMEs by reducing the costs associated with registering a mark; additionally, the Office has been working hard to reduce the time required to register a mark, to the point where a simple application that faces no opposition can move to registration in 35 working days.

In addition, Indecopi has had to be more creative in adapting to the peculiarities of the Peruvian economy. One of Indecopi’s landmark policies has been the promotion of collective marks, which as Mr. García explains, “are tools that allow the value of intangible assets, benefiting a community of organized producers, by distinguishing products that share common characteristics such as geographical origin, raw material, traditional, ancestral, or cultural practices.”

In Peru, there are particularly diverse geographies, peoples, cultures, and traditions, and Indecopi has promoted the collective mark scheme  to encourage the use of IP and entrepreneurship more broadly in communities that otherwise may not have been able to access the knowledge. 

Mr. García says that Indecopi provides support to these entrepreneurs in the various stages of this formalization, including providing legal advice before the start of the collective mark initiative, making applicants aware of the requirements, monitoring that the registration is progressing correctly, and even, ultimately, providing tools that help consolidate a mark in the market.

In the wake of severe flooding which drastically adversely impacted many Peruvian communities in 2017 and 2018, Indecopi waived all registration fees for collective marks. Mr. García explains that this has been extended until September 2019 due to its unprecedented success: the number of registrations of collective marks increased from 53 in 2017 to 823 in 2018.

More than 7,000 families of producers, artisans, and SMEs from the areas affected by the floods have subsequently benefited from collective marks, Mr. García adds. 

Indecopi is currently exploring whether to reduce application fees for all types of IP for SMEs to further enhance its approach, while continuing to host SME-targeted road shows across Peru, he says.  In 2018, the Office hosted events in nine regions of Peru, providing advice to more than 1,400 entrepreneurs.

Switzerland

The Swiss Federal Institute of Intellectual Property (IPI) has been engaging with SMEs based on a research project that began back in 2009. “SME-IP” looked at how SMEs were using IP and what they needed in terms of IP services, explains Eiman Maghsoodi, Economist in IPI’s Legal & International Affairs Department.

"The best indication of effectiveness is the rising demand for our services." Eiman Maghsoodi

In response, IPI developed various tools for SMEs, including a “Contact Center” where SMEs can get quick answers to their IP questions, as well as training resources aimed specifically at the SME sector. 

The Institute has also set up an “IP Advisory Network,” which offers SMEs a free, 45-minute legal consultation with an attorney member of the network.

Next, IPI hopes to update the previous research and use it to further drive policy, as well as to measure the impact of IPI’s work. Mr. Maghsoodi says: “While the best indication of effectiveness is the rising demand for our services … one of the future aims is to evaluate the performance of our measures as far as possible.”

United Kingdom

Similarly, the UK Intellectual Property Office (UKIPO) has prioritized digital tools as a means of enfranchising SMEs to protect their IP more effectively. Underpinning this strategy is the conviction that educating SME owners on the importance of IP and then helping them to maximize their IP protection is a key function of the Office. “It is important to us that IP is a critical element of an SME’s wider business strategy,” says Sarah Whitehead, Deputy Director of Innovation at UKIPO. 

The Office has introduced “IP for Business,” a “suite of digital tools” aimed at SMEs. These tools include the “IP Equip” and “IP Healthcheck” initiatives, which offer free online educational modules about the basics of IP, and help determine whether a business is effectively protected.  According to Ms. Whitehead, these tools have been accessed over 50,000 times in the past seven years.

UKIPO also offers face-to-face engagement through events such as the “IP Masterclass.” According to Ms. Whitehead, this intensive three-day course is central to UKIPO’s efforts to educate partner organizations that advise SMEs on business strategy. These partners include local and devolved authorities, the library network, and England’s Growth Hubs. These Growth Hubs were established by the U.K. government as part of efforts to boost small business proliferation. 

More than 700 partners have completed the course since its launch in 2012 and “report a positive response from their customers,” says Ms. Whitehead.

Ultimately, the goal of these initiatives is to increase innovation. Ms. Whitehead says, “The education of SMEs is very important to the UKIPO’s work; it’s about behavioural change. IP plays an important role in contributing to the UK’s industrial strategy and the government’s ambition to make the UK the most innovative country in the world.”

Different Strokes

What is clear is that IP offices need to adapt to the unique environments in which they operate; not all SMEs face the same issues, and not all countries have the same business landscape. 

Nonetheless, there are some common threads that can be drawn between the work of IP offices around the world as they try to extend the benefits of rights protection to SMEs. Education is a recurring theme. 

In most cases, it appears that small enterprises often know little or nothing about the available tools for protecting their IP. The major task for IP offices set on assisting SMEs will be not only reaching them, but also making sure that when SMEs are innovating, they turn to IP first rather than as an afterthought.