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Intellectual property can be a crucial business tool, however, not everyone thinks hard enough about protecting their big ideas. In 2001, plumber Brad McCarthy got stuck on a remote beach in Cape York in north Queensland and spent about six hours getting his car out with a hand winch. He knew there has to be an improved way. In response, he invented Maxtrax, a lightweight vehicle-recovery device for bogged off-roaders.

After designing the Invention Patent, he attended a Queensland Government business seminar, where advisers stressed getting patent protection before his idea was publicised. “One of the first things we did was speak to a patent attorney to view how we could protect the idea,” says McCarthy, who launched Maxtrax in 2005. It really is now purchased in about 30 countries worldwide. McCarthy has patents in key markets like Australia, Europe and also the US, and the business also has a trademark on the distinctive original “safety orange” hue it uses for its moulded product. Unlike McCarthy, however, many inventors and businesses with recommended cruel their likelihood of success from the first day.

Their big mistake? Ignoring patents or some other intellectual property protection before they spruik their idea to investors, people as well as friends. It may be a costly error. Bradley Postma, principal at patent and trademark attorney firm Cullens, says small and medium enterprises (SMEs), in particular, often neglect safeguarding their IP or think it will probably be too costly. “The vast majority of protectable IP goes unprotected,” he says.

Europe can be quite a particular trap for exporters because, unlike some other major markets, it does not have a grace period making it possible for public disclosure of an invention without affecting the validity of any subsequent patent application. That opens just how for an idea or product to be copied. “In Australia and america that you can do something about it, provided you’re in a one-year window – in Europe you can’t, it’s far too late,” Postma says. “In that case, businesses have shot themselves inside the foot; they’ve forfeited their rights and everyone can copy [their idea].” Postma observes that business people often think their idea is too very easy to warrant a patent. “However, if it’s successful and straightforward, it will likely be copied and you have to get advice.”

Unitary patents on way – Margot Fröhlinger is principal director of Patent Help Companies, European and international legal affairs in the Munich-based European Patent Office (EPO), which oversees about 160,000 patent applications annually. She recently completed a road trip warning Australian firms that poor patent and IP safeguards could derail their European market opportunities. Companies need to innovate – and protect their inventions. “You have to have the protection of your IP and, in particular, patent protection to get a good return on your investment,” she says.

Many international businesses have baulked at exporting to Europe due to complex patent processes across multiple jurisdictions that will result in potentially high costs and marginal protection. However, the EPO is promoting a whole new unitary patent system that promises to become a game changer. This will make it easy to get protection in as much as 26 participating European Union member states with all the submission of the single request towards the EPO.

A November 2017 EPO study, Patents, Trade and FDI inside the European Union, suggests better harmonisation of Europe’s patent system provides the potential to increase trade and foreign direct investment in high-tech sectors, delivering annual gains of €14.6 billion ($A22.8 billion) in trade and €1.8 billion (A$2.81 billion) in foreign direct investment.

Fröhlinger believes Australian businesses across all sectors have possibilities to expand in to the European market, which boasts a lot more than 500 million people, high gross domestic product and robust consumer demand. “It’s essential for Australian businesses to know that there is a big change ahead in Europe. I’m not talking just about patents,” Fröhlinger says. “It’s extremely important with an integrated IP portfolio considering patents and trademarks and (covering) design. When they don’t have (IP) people in-house they ought to make an effort to get strategic business advice.”

The need for intangible assets – This call to action for Australian businesses may come as the international Innovation Index 2017 reports on countries’ IP receipts as a portion of total trade. Essentially, the measure indicates just how a country has been doing on the IP front. While Australia scores well in terms of inputs into research and development, the usa (5.1 per cent), Japan (4.7 %) and Finland (2.9 per cent) easily outperform Australia (.3 %) on IP royalties.

Your message? For the most part, Australian companies are not great at converting research into value and treat IP almost as an administrative function. The exceptions are health tech leaders, like medical device dppdwz Cochlear and sleep-disorder business ResMed, which understand the importance of intangible assets like brand name and data use, and build their businesses around it.

In a knowledge-based economy, IP has grown to be Inventhelp Inventions and governing it has stopped being only a matter of organising trademarks and patents. Intangible assets are rapidly more and more important than tangible assets and require appropriate consideration.

An overview of Australia’s top listed companies, released by Glasshouse Advisory in September 2017, endorses this kind of sentiment. It reveals that 38 per cent from the companies’ value (in regards to a$550 billion) is not included on their own balance sheets; this indicates that investors are operating without insights in to a significant proportion of the corporate asset base.