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VI Intellectual propertyAll businesses own and use intellectualproperty. It protects the results of innovation,creative effort and goodwill. For example, trademark law protects the name under which abusiness trades, there is copyright in thedocuments and artwork it creates, and patentsare available to protect its technology.Some of the intellectual property that abusiness uses will be developed by its ownemployees and some will be bought or takenunder licence.Intellectual property rights are valuable assets,and companies attribute large sums in theirbalance sheets to copyright works, patents andbrands.The principal intellectual property rights are:• patents;• copyright;• registered and unregistered trade marks;• registered and unregistered designs;• database right.It is also possible to use the law to protectconfidential information, know-how and tradesecrets, even though these are notconventionally regarded as property as such.The principal attributes of these intellectualproperty rights are set out below.A business proposing to trade in the UK willneed to consider the intellectual property rightsavailable both under English and EU law(which applies in the UK). For example, inaddition to the rights granted by English law, itis possible to own a Community trade markand Community designs. Businessesproposing to trade in the UK or establishthemselves in the UK therefore need tounderstand how intellectual property rights arecreated and protected in the UK and Europe.For the purpose of this note, we will treat EUrights as if they were local rights.Foreign intellectual property rights are notcapable of being enforced as such in the UK.They may entitle businesses to equivalentrights under English law, but not necessarilyand not on the same terms. Businessesentering the UK need to establish what theirrights are and what action they need to take toperfect them.Intellectual property rights are rights inproperty and they can be dealt in, assigned orlicensed to others. The owner of intellectualproperty generally has the exclusive right toperform certain acts with respect to the worksprotected by it; for example, the right to copy acopyright work, to use a patented process or tomake an item to a design. Third parties are notusually allowed to perform any of these actsunless the owner grants them a licence to doso, usually in return for a fee.If a company finds that someone else is usingits intellectual property without a licence, quickaction is needed to enforce the intellectualproperty and to protect the business.1. PatentsA patent protects an inventive product orprocess. In order to qualify for patentprotection, the invention has to satisfy anumber of conditions, namely, it must be new(in other words not previously disclosed to thepublic), demonstrate an inventive step (i.e. itmust not be obvious to someone who is skilledin the relevant field) and must be capable ofindustrial application.Patents are territorial rights and are applied forin specific countries or groups of countries. Inthe UK, a patent application is filed containinga description of the invention, claims and anydrawings, a search for inventions in the area isconducted and the application is thenexamined in the light of the search results. Inprinciple, once granted the patent will normallylast for twenty years from the date of theapplication subject to payment of renewal fees.During this time, the owner of the patentgenerally has a complete monopoly over theuse and exploitation of the invention coveredby it. Once the patent has expired, theinvention may be used or exploited by anyoneelse.2. CopyrightCopyright arises automatically and protects theway in which an idea is presented, in contrastto the idea itself. In the UK, copyright cannotbe registered (unlike trade marks andregistered designs). Copyright will only subsistif, amongst other things, the work is original -that is, the work is not copied. Examples of thevery different types of work that attractcopyright protection include text or drawings inPAGE 27