Jack Ellis

British SMEs vented their frustration at the high costs of IP enforcement at an event held in London last week. However, delegates were warned that a lack of IP awareness means that UK small businesses face mounting difficulties in competing on the world stage.

Speaking at ‘Helping UK SMEs succeed in a global marketplace’, Ceri Witchard, deputy head of innovation at the UK Intellectual Property Office (which produced this paper on the topic last April), suggested that IP is too often viewed as a cost centre by UK entrepreneurs, rather than as an opportunity to create value streams. “IP is not simply a legal issue – it’s a means of making money,” she said. “That’s what we need SMEs to learn.”

Was Rahman, an adviser from UK Trade & Investment, highlighted what he saw as a critical lack of understanding on the part of British SMEs when it comes to commercialising their inventions and suggested that this shortage of strategic nous is harming their competitiveness. “There are plenty of very large, consumer-facing companies in China and India that are very keen on working with UK entrepreneurs,” he said. “But all too often, the conversation they have with them is focused on technical features of the invention and making assurances about IP protection, rather than the key issue of ‘how can we make money from this IP?’. Asking a company how it can guarantee it will not steal your IP – and asking whether that can be achieved under UK law, rather than Chinese or Indian law – is not the best way for UK inventors to go about selling their technology.”

However, several delegates argued that the comparatively high costs of enforcement makes the UK patent system inaccessible and ineffective for SMEs – and as a result, many may simply choose to forgo IP protection for their innovations altogether. Perhaps those gripes go some way towards explaining why British companies are conspicuous for the low number of patent applications they make worldwide compared to their counterparts from similarly sized countries; shunning IP in their home jurisdiction presumably leads many small UK businesses to do the same abroad too.

Early-stage businesses have plenty to worry about, and beginning to develop a commercially oriented IP strategy can probably feel like an unnecessary headache – especially when the possible cost of litigating to protect your rights can seem prohibitive. Therefore, it gets put somewhere near the bottom of the list of start-up priorities (or, sometimes, it doesn’t even make the list at all). But in a world where IP is more important than ever to attracting funding, closing deals and creating business value, disregarding it can often amount to ruling yourself out of the game.