World IP Day 2021: Intellectual Property Rights for SME’S
The pandemic has had a disastrous effect on globalization and has toppled economic systems in place throughout the world, inflicting huge shocks on businesses and governments as global value chains have been almost entirely disrupted. 2020 has in a way, let innovation and smart entrepreneurship shine through, as it has enabled businesses, especially small and medium enterprises, to adopt a system of resilience and adaptability in order to maneuver their way around this crisis.
However, there are a number of challenges faced by such businesses when it comes to the field of intellectual property. Many small enterprises are too slow to try and protect their intellectual creations, simply because of the fact there is not enough awareness out there on the relevance of IP in businesses. Considering the importance of SMEs in economies around the world, which constitute around 90% of all enterprises worldwide and account for over 70% of the production of goods and services, this is a huge misstep in any enterprise’s path to growth and success. Due to this lack of information, many SMEs also perceive the cost of obtaining intellectual property protection as excessive, because to them, it offers not enough returns on investment.
To commemorate world IP Day, which occurs on April 26, WIPO’s Director-General Daren Tang broadcasted a video message, where he decided to introduce the theme “IP and SMEs: Taking your ideas to the Market”, celebrating small and medium enterprises as the ‘unsung heroes’ of the global economy, as an engine for growth in a post-pandemic world. He pointed out the ambiguity and the lack of awareness of the importance of intellectual property within SME’s, which would not only allow them to convert their ideas into lucrative products, but would also help them compete, thrive, and build back the battered economy. This is not the only time Dr. Tang has recognized and devoted himself towards making smaller enterprises a priority. One of his first steps as a Director-General was to establish the “IP and Innovation Ecosystems Sector” as one of WIPO’s key sectors, with a remit to support SME’s entrepreneurs and researchers in commercializing IP and using it to grow their businesses.
How does intellectual property really benefit SMEs? Offering IP protection to SMEs would offer them a guarantee that their creativity would be rewarded, and in the process, incentivize them to invest in research and development and take risks to develop innovations that would not only profit them but also serve the greater interests of society. A proper understanding of IP would also ensure that these small enterprises could optimally utilize their limited resources and innovate on top of existing technologies instead of having to develop them from scratch, thereby leveling the playing field and allowing them to compete with other big players in a free market. IP rights, if used correctly, may also enhance the worth of a small enterprise in the eyes of investors, and can also significantly contribute to the value of a business entity. This comes at a time when information technology has gained a large amount of prominence, rendering ideas, technological and innovative developments, and other such intangible assets more valuable to a company than actual physical assets. Intellectual property rights can also set a stage for testing the waters and pitching one’s product before a potential customer base. This is a very effective marketing strategy, by allowing companies to lure consumers into easily recognizing their products through their registered trademark, and allowing the company to also diversify in that realm.
Therefore, it is absolutely essential that governments throughout the world develop systems that would bolster the growth of SMEs and allow them to fairly compete with bigger conglomerates. By enhancing awareness among entrepreneurs and SMEs about the importance of intellectual property system and its related rights, governments ought to develop policies that would further the cause of identifying and addressing the IP needs of such enterprises, as well as facilitate the application process and reduce the transaction costs for availing such protection.