10 September 2008

Why “IP Yorkshire”

Team GB may have done very well at the Beijing Olympics but our inventors and entrepreneurs are nothing like as successful in the European patent application stakes. As can be seen from the following table, we trail a poor 7th in the number of European patent applications. Not only do we lag behind the economic super-powers, the USA and Japan, but we compare badly even to France and Germany with similar populations and GDP. We even trail the Netherlands and Switzerland with a third and an eighth of our population respectively and are about to be overtaken by distant South Korea which was a battlefield 50 years ago.

European Patent Applications since 2002

35 588
34 794
32 738
32 625
31 863
30 118
25 176
24 806 
23 789
23 044
22 701
21 039
22 887
21 461
20 584
18 534
15 912
8 328
8 051
8 034
8 079
7 431
6 853
6 999
7 360
7 799
6 974
6 459
5 054
5 855
5 503
5 027
4 663
4 180
3 882
4 979
4 722
4 649
4 791
4 843
4 709
South Korea 
4 934 
4 595
3 853
2 871
2 075
1 408

(Source Jane Lambert (c) 2008 compiled from annual "Facts and Figures" published by the European Patent Office)

Why does the UK do relatively badly?

The reason for our lacklustre performance is that start-ups and other small businesses, that are the mainspring of innovation in the UK as in most of our competitors, make much less use of the intellectual property system than their equivalents in other countries and, indeed, much less use than multinational enterprises and other big businesses here.
There are two reasons why small businesses eschew the intellectual property system. One is that the cost of obtaining and enforcing legal protection for investment in brands, design, technology and the creative works is prohibitive and the other is that the intellectual property services available to small businesses, particularly outside London, is patchy in quality and, when compared to the unit costs that major companies pay, relatively expensive.
As for cost, research commissioned by the European Patent Office reported that it costs over €32,000 to obtain and maintain a typical, European patent on 6 countries over 10 years. But those costs pale into insignificance when compared to the cost of enforcement, particularly in the UK. According to the British government's own (but now disbanded) Intellectual Property Advisory Committee, it can cost over £1 million for an infringement action in the Patents Court and even £150,000 to £250,000 for the Patents County Court compared to no more than €50,000 in France, Germany and the Netherlands (see the table at page 50 of IPAC "The Enforcement of Patent Rights" published on 18 Nov 2003). The other big difference between big and small companies is that the latter know how the IP system works. They have day to day experience of the legal protection that is available in each jurisdiction, which innovation is worth protecting and which is not, the optimum protection for each innovation in each market, which lawyer, patent or trade mark attorney is good for a particular type of work and so on. They can use their considerable purchasing power to secure the services of the best professionals on advantageous terms. By contrast, inventors and small business people resort to the lawyers who drew up their lease and drafted their T & C and employment contracts who0 are as often as not on an expensive learning curve and who are forced to pass on their cost of learning or perhaps purchasing the expertise of the London patent bar on to their hard pressed clients.

Is there a Solution?

There may not be much one can do about the imbalance of resources between big and small companies but there is a lot that can be done about the learning curve. Inverting the famous conversation between F Scott Fitzgerald and Ernest Hemingway, SME are different from other IP users. They have much less money and the little they have has to be husbanded widely. Wise husbandry requires very special skills and those skills are not easy to identify. To assist businesses to identify high quality advisors NIPC has established a panel of trusted professional advisors who possess those skills and share our mission of bringing high quality professional services within reach of those who need them most but can often afford them least. They include patent and trade mark agents like Janet Bray, Carin Burchell and Barbara Cookson, specialist IP solicitors like Kate Reid of Pemberton Reid and James Love, company and commercial experts like Jane Sachedina and Umberto Vietri and experts in many other fields such as Richard Hall in product design and development, Gareth Morgan in marketing, forensic accountant, Michael Swift and many, many, more. These are some of the experts to whom we refer clients when we are asked to recommend solicitors, patent agents or other professionals. We do that safe in the knowledge that each of those professionals knows his or her job, each of them cares about our clients just as much as we do and each of them will give our clients that professional's best deal.

So what is IP Yorkshire?

IP Yorkshire is the collective name of the panellists serving Yorkshire. NIPC panellists have their own private network on NING known as nipNET where they exchange ideas and information and IP Yorkshire is one of its sub-groups. This blog will be the one of the means by which we shall communicate our collective knowledge and experience on intellectual property and technology law to businesses and professional advisors in Yorkshire. This is the first of several such networks which will run IP clinics, present courses, hold CPD training courses and provide many other events. Membership of the NIPC panels and the regional subgroups is by invitation only but it is not exclusive and it is not controlled by me. Essentially anyone who can satisfy the existing panellists that he or she is very good, that he or she shares our mission and that he or she will contribute to the group as a whole will be considered for membership of the panels.