Protecting your assets
For any business to thrive it is vital that they develop their products and services in order stay ahead of real or perceived threats.
Over the next couple of pages we look at the crucial time when an original piece of work has been created and you want to do everything possible to legally protect your asset.
This can be a hugely complex area. As Margaret Briffa, IP specialist remarked in our July issue earlier this year referring to the how The Court of appeal in England can come to a very different conclusion to the courts in other countries in the European Union. The question being asked is whether UK designers are as protected as their European counterparts.
Margaret says, ‘The Court of Appeal in England has never found a registered design to have been infringed. It’s time surely to take a long hard look at how we have come to this point and see what needs to be done to provide proper protection for our design industry.’
Earlier this month the battle between Trunki, the famous ride on children suitcases, reached the Supreme Court. The decision which is expected in a matter of weeks will clarify the protection designers have and may be the judgement that puts UK designers on an equal footing with designers in Europe.
And there is good news too for designers who produce iconic 3D works, which up to now others have been free to copy after a maximum of 25 years. There are legislative changes currently underway which may see full copyright being restored to designers who produce artistic works even when they are mass produced. This means designers will be able to prevent copying of their designs for their life time and the right will also last for 70 years after their death. These game changers are now potentially due to become law as early as April 2016. It is time for designers to clue themselves up on how these changes can benefit their businesses and use the law to grow their business.
Intellectual Property Enterprise Court (IPEC)
Until a few years ago SME’s had no real redress against copyists as the risks in taking an action against a copyist with deep pockets was too high. There was literally no limit to the costs which could be claimed against you if you lost a case. The Intellectual Property Enterprise Court has changed all that.
Margaret Briffa’s firm regularly brings action in this court, which she says ‘…has resulted in a major change to the way in which businesses can protect their intellectual property value and in making sure that designers maintain value in their business and day to day income’.
The Court will hear any intellectual property disputes where the damages claimed are between £10,000 and £500,000. The radical feature, however, is that costs are capped at the various stages meaning that you can recover only up to a certain level of costs and only ever be ordered to pay up to the cap also. Where you have a good case and your lawyer stays within the cap, your prospects of a successful action are high. So effective is the procedure that there is definite shift in mentality among SME’s, who are using the court to secure judgements in respect of their important products, where copied, and using that judgement to help them clean up
‘We do register our designs with the OHIM (Office of Harmonisation for the Internal Market) and we are also members of ACID which is a helpful resource. It’s important to protect the products, as IP theft is unfortunately on the increase.’
Funding the project
How often have you been told that there is a shortage of grade A office space due to the slowdown in office development over the last six years? Virtually every city in the UK will see a deficit in new high spec office in 2016.
Our regional report on page 76 highlights that in October this year Manchester passed the 1,000,000 sq ft office take up for the last 12 months, but even with the amazing new developments set of 2016 the thirst for quality office will not be satisfied.
In our view, amazing office refurbishments will be making the news in 2016 and beyond as clients look to grow and consolidate (look out for our next issue where we look at the transformation of the headquarters of Regatta by Space Invader, for example).
So the client has made a decision about upgrading their current office environment; next issue to deal with is the current pressure to provide an office environment fit to attract the best staff. Then comes the challenge of funding the project.
Historically clients have used cash or bank facilities but as a recent report suggested, overdrafts for small firms are being withdrawn or cut by major lenders at an increasing rate, with around 17% of small and medium sized enterprises reporting that banks have removed their overdrafts altogether. We are told that many clients use Capex as their method of financial allocation, in other words deciding some months or years in advance, ensuring it is written into the annual accounts and added to an asset account.
A financial arrangement in which a person or organisation pays to use land, a vehicle etc. for a particular period of time.
‘The finance landscape is changing and there is an increasing use of alternative asset finance, providing a real opportunity in the commercial interiors industry due to high capital cost of a fit out.’
R&D tax relief
So far on our Mix journey through the world of assets we have looked at protecting your intellectual property (IP) and funding the fit out. We now take the opportunity to explore research and development (R&D), in particular the part where the Government wants to encourage innovation through R&D tax credits.
So what are R&D tax credits? Firstly they are not a tax! According to the Government if the company is making a profit ‘R&D tax relief is a Corporation Tax (CT) relief that may reduce your company or organisation’s tax bill.’ For companies that are making a loss and not paying CT they receive a cash credit if the loss is surrendered.
Not surprisingly in this hugely competitive world, many manufacturers are constantly looking at ways to provide better products to satisfy increasingly high expectations and stay ahead. Tony Attard, Group Chief Executive of Panaz Holdings told Mix: ‘We take part in the R&D tax credits scheme every year. As an innovative company with a substantial amount per year invested into R&D it is essential that we can get some of this investment back against our corporation tax. It takes a little bit of organisation but if all personnel involved in the innovation process keep note of their time and expense then it is a discipline that is worth it.’ Elliot Brook from Deadgood adds, ‘We have claimed R&D tax relief for a number of years and found it very beneficial.’
‘It was purely luck that we became aware of this funding; a chance meeting at a networking group where I was introduced to an R&D funding expert. The paperwork to apply is simple and your accountant should be able to help. So if an element of your business involves research and development, seek advice as soon as possible.’