SMEs and Intellectual property

Today, small and medium-sized enterprises (SMEs) are the driving force of innovation in the global economy. Small and medium-sized enterprises perform approximately 90% of the world’s business, employ approximately 50% of the world’s workforce, and generate about 40% of national income in most national economies. That is why it is said that SMEs are “the backbone of every national economy”.

The creative capacity of SMEs, however, is often not used in full, primarily because SMEs do not have adequate knowledge about intellectual property, or they think of IP protection  when a problem arises or when the protected intellectual property is a condition for concluding a deal.

A good idea can be crucial for the development of one’s business, and good ideas are often subject to copying. Intellectual property system plays an important role in different business activities:

  • Establishment of a legal monopoly on your invention, trademark, design and so on, giving the legal tool to prevent or to act against unauthorized use of SMEs creations;
  • In product advertising;
  • Contributes to the reputation of SME as the one who cares about its IP rights;
  • Knowing the competitor’s IP rights significantly reduces the risk of unknowingly putting SMEs in a situation of violating someone’s IP right and exposing him to inconvenience.

What can be protected as intellectual property?

Protect your innovative technical solutions from competition

Your innovative or improved product / process can be protected as an invention, under certain conditions, by a patent  or a petty patent. It is very important that you submit the application for a patent or a petty patent before placing the product on the market due to the novelty conditions that are necessary for protection with patent or petty patent.

With a patent, you can prevent others from using your technical solution and secure a better position in the market, which means, among other things:

  1. Greater legal certainty – the patent holder has the legal means to prevent the copying of the technical solution covered by the patent;
  2. The ability to easily (through a license, for example) dispose of IP rights;
  3. Raise the value of the company because the patent belongs to the so-called intangible assets whose share in the modern economy is getting higher, etc.

Protect visual identity on the market

If SME builds its reputation in the market through a name, logo or other sign that is used in trade, or develops the new appearance of the product or its packaging, then trademark or industrial design protection should be considered.

Trademark protection – The sign with which company marks products or services is subject to trademark protection. Protecting a trademark significantly reduces the risk of unauthorized copying. With a registered trademark, the company will be far more successful in enforcing it if a dispute arises.

A trademark is also a great tool in marketing, it is often said that a trademark sells goods. Without a trademark, you can not build your “brand” without risk of counterfeiting.

That is why it is important that you carefully choose and create your sign from the very beginning so that it is truly recognizable and unique. The mark must not be descriptive (for example, you cannot protect the verbal sign “television” for TV devices) or similar to other distinctive signs marking similar or identical goods or services on the market.

Protect the new design of your product.

Consumers decide to buy a product simply because the product is attractive. If the “attractiveness” of a product, refers to its novel appearance and an individual character, it can be protected by industrial design. Any product, three-dimensional or two-dimensional, independently of its attractiveness, fulfilling the mentioned conditions prescribed by the law, can be protected as industrial design. By registering an industrial design, SME acquires the legal mean to prevent competition from producing or marketing an identical or substantially similar product by appearance.

Protect the original creations that are created in your company

There are entire industries that are based on copyright and we often call them creative industries. IT industry, video game industry, music and film industry, publishing books, newspapers or magazines, are all examples of creative industries. If SMEs base their business model on creating original, creative works that fall within the domain of copyright and related rights, one should know that there is no formal procedure for copyright protection. The copyright work is protected by the very creation of the original work at the time of its creation (poems, stories, paintings, illustrations, photographs, etc.), and it is not necessary to carry out the formal procedures for copyright registration. There is a possibility of recording and depositing copyright works within the Intellectual Property Office. The act of depositing, as it was said, does not create copyright. Nevertheless, by deposition of copyright work, author of work, can prove that he is the author. However, that is not an absolute assumption – the other party can challenge it in court. However, there is a benefit: the court is obliged to assume that you are the author and the other party must prove that this is not true. This is especially useful if these are the works that are not published or used before act of deposition.

On the other hand, if the company uses in business activities copyright works that were not created in the company, but were created by external collaborators, the ownership and the ways of exploitation should always be defined, e.g. in advertising campaigns or for other purposes.


What are other ways to protect knowledge, information and innovation?

Intellectual property rights represent the legal protection of your creations, but your ideas and other intangible assets can be protected also as a trade secret when conditions prescribed by the law have been met. A trade secret can protect various types of information that are important for the business of your company, but are not publicly available, such as production procedures, business and financial plans, advertising strategies, market research results, lists of suppliers and customers, architectural projects and the like. All the above information provides economic entities with an advantage over the competition and therefore it is very important for them that the law guarantee them protection from acts of unfair competition – unauthorized disclosure, acquisition and use of business secrets. If you have information that may be subject to the protection of trade secrets, it is advisable to contact lawyers or other legal representatives, for drawing up the trade secret contracts and settling the obligations of the contracting parties.


Experiences of Serbian companies

Find out first hand the stories of Serbian companies about the experience with intellectual property