What is Intellectual Property and Why is IP Important to a Business?

By Dawn Wattie, Surrey Business Lawyer

Intellectual Property (IP) is slightly irregular in a legal sense because, as a whole, it is often defined by its individual components’ legal rights – such as copyright, trademark, patent, industrial design, plant breeders’ rights and trade secrets. In Canada, all the intellectual property rights have individual acts (laws created by government) with the exception of “trade secrets” which is defined by common law (laws created by judges).

Intellectual Property is also very unique because of the jurisdictional paradox it can create – although we clearly live in a global world where the Internet transcends territorial boundaries, Intellectual Property rights, when not bound by international treaties, continue to be significantly impacted by geographic limits.

The irregular nature of Intellectual Property law can lead entrepreneurs to the conclusion that IP protection requires major cost and commitment to legal resources. As a result, many businesses pay insufficient attention to the management of Intellectual Property as an asset during the initial stages of start up or on an ongoing basis as part of a corporate asset growth strategy.

Another way to define Intellectual Property is to look at the different components that comprise legal IP rights. Some examples:

• Copyright – protects original works created by writers or computer programs, photographs etc that are part of a company’s products and services
• Trademarks – the marks used to brand a company’s products and services
• Patents – the processes, devices, apparatus and chemical compositions that operate or comprise a company’s products and services

When Intellectual Property is defined in business terms, the value and importance of managing your IP as an asset becomes clear – Intellectual Property is critical to the development, marketing and sale of a company’s products and services. The following steps are important when it comes to effective commercialization of your company’s Intellectual Property:

• Early recognition of where Intellectual Property assets of a company reside
• Proper attention to the chain of ownership or title
• Putting in place proper policies, procedures and agreements to protect and enforce IP
• Placing real value on your Intellectual Property (as opposed to just goodwill)