More and more companies are increasingly talking about intangible assets, but even many C-level executives do not understand how to connect value creation to them. International Accounting Standard (IAS) 38 defines intangible assets as identifiable (either being separable or arising from contractual or other legal rights), non-monetary assets without physical substance. Intangible assets largely comprise intellectual property (IP) —patents, trademarks, and copyrights to name a few— and other assets that grant potential economic benefits to the owner (e.g. know-how, data, relationships, etc). Still, there exist very limited ways for enterprises to show their intangible assets on the accounting balance sheet due to how these intangible assets are handled.
Interestingly, the contributions of intangible assets to the companies’ value are dramatically increased over the past few decades. Intangible assets are also ready resources that can seamlessly be brought overseas when a company wants to enter into different markets. Companies are also using their intangibles as a marketing tool to differentiate their products and services from their competitors’ ones (e.g. mention of IP rights on the products/services such as “patent pending” mark or “®” logo on the brand name). This article will mainly focus on discussions related to IP.
Business owners are often concerned about the complexity and high cost concerning IP. This may be true for certain reasons because IP rights are territorial and different countries have different IP regimes. For example, countries in ASEAN have several differences in terms of languages, laws, court systems, and so forth. Therefore, business owners often overlook the importance of IP due to such challenges. It is also worthwhile to take note that some types of IP (e.g. patent) is a double-edged sword that can give you the monopoly rights, but makes your invention known to the public at the same time. In other aspects, IP protection does give you the rights to stop others from copying your invention, but no guarantee for your business success.
Firstly, you must identify the markets to enter into and form of IP protection (e.g. patents or industry designs) relevant to your intangible asset. You may also need to consider available IP enforcement options and the level of commitment to be invested for each enforcement option to help you prioritise which markets to enter. In general, there are four main avenues for IPR enforcement namely, civil, criminal, administrative and custom seizures. The availability and effectiveness of these enforcement options may be varied depending on the jurisdiction. For example, administrative actions involving different governmental bodies which can issue severe penalties such as monetary fines or cease and desist orders of infringing goods would be the most common route for IPR enforcement in Vietnam. In the case of court proceedings, countries such as Malaysia and Thailand have specialised IP courts to ensure that judges hearing cases related to IP infringements are well-equipped with industry knowledge and experiences. In terms of border enforcement, Thai Customs is the most proactive authority among ASEAN countries.
Act immediately if someone is copying your IP because unnecessary delays may hinder your rights to pursue. However, you may need to know the following clearly before you fight for your intangible assets.
In summary, business owners must be aware of different factors that need to be considered before making any strategic decision related to the pursuance of IP protection or enforcement. Conversant with local IP landscape will also better position you in the fights over your intangible assets.
IPOS International helps enterprises and industries use IP and intangible assets for business growth. To learn how you can leverage on your IP, book a complimentary chat session on your intangible assets with us today.Book a complimentary IA chat with us