While it may not be the first thing that grabs your attention when starting up a new company or business, every start-up needs to consider intellectual property (IP) protection at an early stage.

Understandably, start-ups can often focus their initial efforts on raising finance and shortcuts can be taken in other areas leading to shortcomings.  One of these shortcomings can often be to fail to seek advice about how to protect the IP of the business going forward.  Decisions made at this stage often have long term implications both for the future of the company and its tax liabilities.

There is often confusion about what is actually meant by “IP”.  Essentially, IP falls into four categories – trade marks, patents, designs and copyright.  Except for copyright (which arises automatically), all IP rights can be registered in Ireland and abroad.

Trade marks are the most obvious example of IP.  A trade mark or ‘brand name’ is any sign used in trade in relation to goods or services in order to indicate the origin of the goods or services and includes company names and product names (which are often the same).  It is the guarantee to the customer of the origin of a product or service and indicates the quality of the product or service. 

Patents are inventions which are new, inventive and which are capable of industrial application that have been successfully registered with the Patents Office and grant a monopoly over the claims set out in the patent.  It is crucial that an invention is not disclosed prior to applying to protect it as non-confidential disclosure can destroy its novelty and therefore its patentability. 

Copyright is the primary protection for software (although patent protection should also be considered).  Copyright also protects literary, musical and artistic works.

Designs rights and are often ignored.  Designs can be very useful for protecting logos, packaging, GUIs (graphical user interfaces) and the like.  Designs can be both registered and unregistered.

Patents and registered trade marks and designs are all territorial so they only protect the IP for the country in which registration is made.  Therefore, it is important that all key markets are identified at an early stage so that a cost effective plan can be implemented.  This can be often be structured on a staggered basis so that the costs can be absorbed over a period of time rather than in one significant up front payment. 

Intellectual property protection is not necessarily the first item that start-ups need to address.  Usually, incorporating a company and, if necessary, entering into a shareholders agreement and raising capital are the first steps for any new business.  However, IP needs to be considered very early on in the process.  For some start-ups, particularly in the technology sector, the main asset on which capital may be raised is the IP of the company and, for these companies, IP protection should be considered from the very start.  Often, investors expect (or demand) that critical IP is adequately protected before they will invest.  For others, success can lie in the brand – just ask Google or Coke.

It can sometimes be even more important to check that you are not inadvertently infringing third party IP rights which could spell an early end to a new enterprise.