What is Intellectual Property?

Intellectual property (IP) refers to creations of the mind: inventions, literary and artistic
works, and symbols, names, images, and designs used in commerce.

IP is divided into two categories: 

Industrial property, which includes inventions (patents), trademarks, industrial designs, and
geographic indications of source; and

Copyright, which includes literary and artistic works such as novels, poems and plays, films,
musical works, artistic works such as drawings, paintings, photographs and sculptures, and
architectural designs.  Rights related to copyright include those of performing artists in their
performances, producers of phonograms in their recordings, and those of broadcasters in their
radio and television programs. 

Intellectual property represents the property of your mind or intellect. It can be an

invention, trade mark, original design or the practical application of a good idea. In business
terms, this means your proprietary knowledge - a key component of success in business
today. It is often the edge which sets successful companies apart and as world markets
become increasingly competitive, protecting your intellectual property becomes essential.

Why promote and protect

intellectual property?

There are several compelling reasons. First, the progress and well-being of humanity rests on
its capacity for new creations in the areas of technology and culture. Second, the legal
protection of these new creations encourages the expenditure of additional resources, which
leads to further innovation. Third, the promotion and protection of intellectual property spurs
economic growth, creates new jobs and industries, and enhances the quality and enjoyment of
life. An efficient and equitable intellectual property system can help all countries realize
intellectual property’s potential as a powerful tool for economic development and social and
cultural well-being. The intellectual property system helps strike a balance between the
interests of the innovator and the public interest, providing an environment in which
creativity and invention can flourish, to the benefit of all.

Intellectual Property is extremely important to our organization, those patents and know-how
provide us with the opportunity to successfully commercialize product and develop new
business. 

Intellectual capital is recognized as the most important asset of many of the world’s largest
and most powerful companies;

it is the foundation for the market dominance and continuing profitability of leading
corporations.
 It is often the key objective in mergers and acquisitions and knowledgeable companies are
increasingly using licensing routes to transfer these assets to low tax jurisdictions.

 creates value in ways no other business asset can, offering profit margins well above those
that can be earned from manufacturing. This is why intellectual property based companies are
among the most profitable in the economy and why even old-line firms like Ford Motor
Company are shedding physical assets, concentrating their patent portfolios and acquiring
brand names.

Only by valuing intangible assets, such as IP, can a company definitively measure its own
worth, says Robert Wulff, from Griffith Hack, Australia.

The recent push for companies to value intangible assets, such as IP, has come about for a
number of reasons. These include: the increasing importance of intangible assets to the value
of companies and to the market, especially hi-tech companies; international legal and
governmental developments such as the US Sarbanes-Oxley Act and the 2003 OECD
European Intangibles Summit; new international accounting standards from the International
Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB);
and the need to disclose all asset values in business dealings such as during fundraising,
securitisation, mergers and acquisitions, financial reporting and taxation calculations, bank
financing and so on.

When an appropriate and rigorous methodology is applied to the valuation of intangible

assets, especially IP, a business has both a better idea of its own worth, and a reportable and
more transparent indication to the general market and government of its worth. This can
make a business more attractive to investors and can more easily facilitate financing options
for the business. It also helps with regulatory compliance.

Going forward, global pressures will force businesses in advanced and emerging economies
to adopt international standards and approaches to valuing IP assets.