Oficina española de Patentes y Marcas

The benefits of protecting trademarks and inventions are discussed below.

Why should trademarks be protected?

Although the majority of companies understand the benefits of using trademarks to differentiate their products from those of their competitors, not all of them are aware of the importance of protecting their trademarks by registering them.

Registering a trademark gives the company the exclusive right to prevent third parties from marketing identical or similar products under the same trademark or using a trademark that is so similar as to cause confusion.

If the company does not register the trademark, the investment it makes in marketing a product could be wasted, as its rivals could use the same trademark or such a similar trademark as to cause confusion in order to market identical or similar products. If a competitor adopts a similar or identical trademark, consumers could buy the competitor's product by mistake. This not only diminishes the company's revenue and confuses the customers, but also damages its reputation and its image, particularly if the rival products are of inferior quality.

Given the value of trademarks and the importance that a trademark can have for a product's success in the market, it is crucial to ensure that it is registered in the relevant market or markets.

In addition, a trademark license can be granted to other companies, which would mean an additional source or revenue. Trademarks can also be the object of franchise agreements.

A trademark that enjoys a good reputation with consumers can also be used to obtain funding from financial institutions, which are increasingly aware that companies' commercial success is largely dependent on trademarks.

Trademarks:

- guarantee that consumers recognise products

- guarantee that consumers recognise products

- are a marketing instrument and enable a company's image and reputation to be projected

- can be licensed and provide a direct source of revenue through royalties

- represent a determining factor in franchise agreements

- can be important commercial assets

- encourage companies to invest in order to maintain or improve product quality

- can be useful for obtaining funding.

Why protect industrial designs?

An industrial design adds value to a product, making it more attractive and eye-catching to customers and can even become the main reason for buying the product. Protecting valuable designs is therefore usually a fundamental part of any designer or manufacturer's commercial strategy.

When protecting an industrial design by registering it at a national or regional industrial property (IP) office, the holder obtains the exclusive right to prevent unauthorised reproduction or imitation by any third party. This practice is business logic, as it improves a company's competitiveness and tends to create additional revenue in one or several of the ways described below.

- When a design is registered, the right to prevent its reproduction or imitation by the competition is acquired, strengthening the company's competitive position.

- Registering a valuable design helps to provide better returns on the capital invested in creating and marketing the product, leading to higher profits.

- Industrial designs are business assets that can increase the commercial value of a company and its products. The more successful a design is; the greater its commercial value to the company.

- A protected design can also be transferred (or sold) to others by granting a license and receiving an agreed payment, which serves as a way of accessing markets that might otherwise be inaccessible.

- Registering industrial designs encourages loyal competition and honest commercial practice, which in turn promotes the production of a wide diversity of products that are attractive for their form

Reasons for protecting industrial designs:

- To prevent them being copied

- Company policy

- To get ahead of the competition

- A question of prestige

- To avoid others thinking they are being copied

Reasons for seeking patent protection for inventions:

- A solid market position and a competitive advantage. A patent gives its holder the exclusive right to prevent others from using the patented invention commercially and therefore reduces uncertainty, risk and competition from imitators.

- An increase in profits and better returns on investments. If your company has invested a significant amount of time and money in R&D, protecting any resulting inventions with a patent will contribute to recovering costs and obtain a greater return on investments.

- Additional revenue from licensing or transferring your patent rights. As a patent holder, you can transfer your rights over an invention to others under a license in exchange for a fixed sum and/or royalties, in order to generate additional revenue for the company.

- Access to technology by cross-licensing. If your company is interested in technology that is the property of others, you can use the patents held by your own company to negotiate cross-licensing agreements.

- Access to new markets. Assigning patents to others under license can give you access to new markets which might otherwise be inaccessible. In order to do this, the invention must also be protected in the relevant foreign markets.

- Reducing the risk of infringement. When you obtain protection under a patent, you can prevent others from patenting the same invention and you will also reduce your risk of infringing the rights of others when you market your products. Although a patent does not in itself give the "right to use" over the invention, it does stop others from patenting similar or identical inventions and provides an indication that the patented invention is new and significantly different from the "state of the art".

- Increasing the capacity for obtaining funding at a reasonable interest rate. Holding patents (or the license for using patents held by others) can increase your ability to obtain capital for launching a product onto the market.

- Possessing a patent considerably increases your ability to successfully take legal steps against those who copy or imitate your protected invention.

- Giving your company a positive image. Some companies mention or detail their patents in their advertising in order to project an innovative image to the public.

Source: Guides on industrial property for SMEs (Spanish Patent and Trademark Office, SPTO-WIPO).