What your clients need to know about IP before exporting
By: Kylie Adair
Canadian entrepreneur Johanne Boivin found herself in a situation many business owners have nightmares about. After 18 years of running leather bag company Joanel, a giant American company copied one of her signature designs.
“It was the hardest blow since the foundation of my company. I will always remember how discouraged I was,” Boivin told Canadian IP Voices, a podcast hosted by the federal government’s Canadian Intellectual Property Organization. “It was then explained to me that the fact that [the design’s] trademark was registered, renewed and kept up to date, during all these years, this constituted a shield and trademark usurpation procedures could be initiated.”
Ultimately, Boivin learned just how important it was that she’d protected her company’s intellectual property (IP). And she’s not alone.
“We know that businesses that own IP are actually more likely to be exporting,” Lisa Desjardins, manager of business services, design and development at the Canadian Intellectual Property Organization, “because if you own IP, you actually have rights to exclude others in the market. It’s definitely a way for you to grow your market share and not be limited to Canada.”
Better IP protection is a means to getting more Canadian businesses onto the world stage. But Desjardins says “in general, the IP knowledge in Canada is very low — and IP ownership among Canadian enterprises is very low, too. And that puts us in a very vulnerable spot when it comes to exporting.”
Meanwhile, Canadian women business owners are less likely to secure IP rights at all. According to Statistics Canada’s most recent data, from “2001 to 2019, men-owned businesses accounted for a larger share of patent applications than women- and equally owned businesses, and the gender gap did not narrow over the period.” The report adds that even as the percentage of women working in STEM fields has increased over time, “the patenting activity of women has been persistently lower than the share of jobs they occupy.” Statistics Canada has even found that more women than men say IP isn’t important when it comes to exporting.
The World Intellectual Property Organization has a global action plan to address the gender gap. But what can you do in your work with women entrepreneurs? First, it’s important to understand the basics.
Why IP matters
“IP is necessary for any business,” says Desjardins. And it’s important to protect IP abroad, wherever you discuss, display, sell or manufacture – or wherever you suspect someone would want to copy you.
Take manufacturing for example: “If I have parts being manufactured in another country and I don’t have my IP protected in that country, there is absolutely nothing stopping anyone from copying that piece of IP in that country. And that is what we see,” says Desjardins. “Having these registered rights, even in places where you’re not necessarily selling, gives you access to a lot of powerful administration and legal rights that you absolutely don’t have access to otherwise.”
“We live in a knowledge-based economy where IP is crucial,” says Veronique Pagé, vice president of IP analytics and transactions at the Innovation Asset Collective, a non-profit that helps cleantech businesses with IP needs.
IP rights are important for any business owner — because of what could happen if they don’t have them. “The saddest examples,” says Desjardins, “are where somebody has misunderstood the way the system works…and they start to print their company’s name on business cards, their trucks, their products. And maybe that business name slightly resembles that of another and that other business might be a very big company that has that registered right; they can effectively shut down any use of anything similar.”
IP insurance is an effective and popular tool for covering all the business owner’s bases, says Pagé, especially as a pre-export caution. “You can’t start trying to invalidate all the patents in the world. But having insurance will help cover costs if and when” your client has to litigate.
Busting global IP myths
Desjardins says many business owners mistakenly believe that IP rights in one country apply anywhere they do business.
“There’s no such thing,” says Desjardins. “The only thing that would resemble global rights would be copyrights, which are yours in most parts of the world without registration. But for patents and trademarks and industrial designs, and plant breeders’ rights, that’s not the case — you actually need to register it.”
Another common IP myth is that once a business owner has applied for a protection, they’re protected while their application is pending. Also not the case, says Desjardins, so it’s important to have a plan for how to safeguard IP in their target market before exporting.
Building international IP rights into the business plan
Both Pagé and Desjardins say IP rights should be part of any business owner’s strategy from the outset. Desjardins recommends the Canadian Intellectual Property Organization’s IP Inventory Checklist as a way to get started in understanding what IP a business owner might be able to claim.
Pagé asks business owners: “How do you differentiate yourself in the market? What’s the technology that enables that?” Business owners can then build their IP strategy around those differentiators and enabling technologies. And ultimately, “having a solid IP strategy, a solid ownership position, helps create value for companies,” Pagé says.
She means that literally. And Desjardins agrees: “When it comes to investment, [having IP rights in other markets is] inherently augments the value automatically. Every added exclusive right to a market is going to give you a higher value. For investors, it’s obviously a game changer if I say, ‘Of course, I’ve got a plan for my IP in the U.S. I just haven’t gone there yet. But I am registering my trademark there.’”