SENIOR PATENT EXAMINER, ARIPO THE 10th COMESA BUSINESS DIALOGUE HOW INTELLECTUAL PROPERTY RIGHTS PROMOTES SMALL AND MEDIUM ENTERPRISES BY J N KABARE SENIOR PATENT EXAMINER, ARIPO THE 10th COMESA BUSINESS DIALOGUE ADDIS ABABA, ETHIOPIA 25 TO 26 MARCH, 2015

Overview Introduction to ARIPO Old Vs New Economy Intellectual Property Rights (IPRs) and their use to promote SMEs Intellectual Property (IP) Audit Other mechanisms of Exploiting IP Challenges Facing SMEs With Respect to IPRs Measures Taken by ARIPO To Address The Challenges

About ARIPO  ARIPO: African Regional Intellectual Property Organization  Established: December 9, 1976 (as ESARIPO)  Instrument of creation: Lusaka Agreement (in Zambia)  Headquarters: Harare, Zimbabwe  Member States (19): Botswana, Ghana, Kenya, Lesotho, Liberia, Malawi, Mozambique, Namibia, Rwanda, Sierra Leone, Somalia, Sudan, Swaziland, The Gambia, Uganda, United Republic of Tanzania, Zambia and Zimbabwe

MEMBERSHIP Botswana Gambia Ghana Kenya Liberia Lesotho Malawi Mozambique Namibia Rwanda Sao Tome & Principe Sierra Leone Somalia Sudan Swaziland Tanzania Uganda Zambia Zimbabwe = 19 MEMBERSHIP

ARIPO Market: Population & GDP    Population GDP (2012) Country Nr (millions) Growth rate (%) (Billion USD) Botswana 2,004 3,7 14.411 Gambia 1,791 6,3 0,917 Ghana 25, 366 7,9 40,711 Kenya 43,178 4,6 40,697 Lesotho 2,052 4,0 2,443 Liberia 4,190 11,3 1,492 Malawi 15,906 1,8 5,653 Mozambique 25,203 7,5 14,605 Namibia 2,259 5,0 12,807 Rwanda 11,458 8,0 7,103 Sao Tome & Principe 0,188 6,5 0,261 Sierra Leone 5,979 15,2 4,337 Somalia 10,195 2,6 1,306 Sudan 37,195 -4,4 51,453 Swaziland 1231 -1,5 3,861 Tanzania 50,4 6,9 28,249 Uganda 36,346 4,4 21736 Zambia 14,075 7,3 21,490 Zimbabwe 13,724 9,802 Total 226.786 6,25% (Aver.) 267,759.4 USA: 14.99 trillion USD China: 7.318 trillion USD Switzerland: 659.3 billion USD Nigeria: 244 Billion USD South Africa: 408.2 Billion USD ARIPO Member States Population: 226.786 GDP: 273 Billion USD GDP growth rate: 5.3%

ARIPO Mandate Patents and Utility Models Industrial Designs Marks Copyright Access and Benefit Sharing Geographical Indications TK and Expressions Folklore Swakopmund Protocol (2010) Harare Protocol (1982) Harare Protocol (1982) Banjul Protocol (1993) Plant Variety Protection Awareness creation; training and capacity building, Training Programs at the ARIPO Academy [Masters Degree Programme in IP] sponsored by ARIPO and its cooperating partners such as WIPO, JPO EPO, SIPO, KIPO Draft Regional Framework National Frameworks Draft Regional Framework Draft Regional Framework Council Min (2002)

Old v New Economy (1) Industrial economy – focus on physical goods. Dependent on natural resources (finite) New economy – greater reliance on know-how, knowledge, human creativity and innovation (infinite) 1950 knowledge component in manufactured goods 20%, 1990s 70%, 2000s *?

Old v New Economy (2) In 1998 intangible assets constituted 80% of value of Fortune 500 companies. “It is estimated that by 2007, as much as 90% of the value of the world’s top 2000 enterprises will consist of intellectual property” Source: Building and Enforcing Intellectual Property Value, An International Guide for the Boardroom 2003 Price WaterhouseCoopers

Old v New Economy (3) Globalization and trade liberalization has made it crucial for SMEs to become internationally competitive even when competing exclusively in domestic markets Application of knowledge, creativity and innovation key in competitiveness

Competitiveness of SMEs To be competitive SMEs need to constantly improve their efficiency, reduce production costs and enhance the reputation of their products and services by: Investing in research and development Acquiring new technology Improving management practices Developing creative and appealing products and designs Effectively marketing their products and services

The Intellectual Property Rights (IPRs) System Provides SMEs exclusivity over the exploitation of their innovative products and services, creative designs and brands Thus creating an appropriate incentive for investing in improving their competitiveness Ensures a competitive market place, honest trade practices and overall national development

PROTECTION THROUGH INTELLECTUAL PROPERTY IPRs Patents Trademarks Industrial Designs Geographical indications Copyright Trade Secrets Plant Varieties Traditional Knowledge Integrated Circuits Topographies

Intellectual Property Rights Patents or utility models Copyright and related rights Industrial design rights Trademark Layout-designs or integrated circuits Geographical indications Trade secrets Innovative products or processes Cultural artistic and literary works Creative designs Distinctive signs Microchips Denominations of goods attributable to a geographical origin Confidential business information

Intangible to Tangible By providing such protection the IP system gives the owner of those intangibles a right of exclusivity, the right to prevent others from using them Bringing intangible rights closer to tangible property

Use of Trademarks (1) An Italian businessman buys unmarked t-shirts from manufacturers of generic clothing In a garage in the periphery of Rome, he attaches his trademark (Pickwick®, which has a picture of a rebellious-looking teenager) and begins to sell them to retail stores

Case Study on Trademarks (2) Today the Pickwick® trademark is perceived by Italian teenagers as a synonym of style and quality Pickwick® has began to export its products across the globe Its trademark is its most valuable asset

Use of Industrial Designs

Use of geographical Indications Branded vanilla, Branded Coffee and Branded honey

Use of Trade Secret – Coca Cola Coca Cola formula said to be the best kept secret Formula kept in a bank vault Can only be opened by a resolution of the company Board of Directors Only a few people know the secret at any given time, their identities are unknown, they cannot travel together

VALUE OF SOME TOP GLOBAL BRANDS VALUE (billions USD) 119 107 82 72 61 45,48 45,46 42,3 42,2

VALUE OF KENYA BRANDS

One product many IPR (1) Source: Japanese Patent Office Patent for the fountain pen that could store ink Utility Model for the grip and pippette for injection of ink Industrial Design: smart design with the grip in the shape of an arrow Trademark: provided on the product and the packaging to distinguish it from other pens Source: Japanese Patent Office

One product many IPR (2) Invention of CD player protected by patent Brand on CD player protected by trademark Design of CD player protected by industrial design Music played on CD player protected by copyright

IP Policy Beyond exclusivity – IP rights are not only about exclusivity and the right to prevent others from using and exploiting them They are assets as important or even more important than physical assets (buildings, machinery) Like any asset they must be identified, protected, maintained, managed, exploited and enforced

IP Audit for SMEs Identify the IP assets of a company Have rights been acquired for them Are they been maintained Are they exploited optimally Is there any redundant IP Is there any infringement of third party rights

Exploiting IP Assets (1) Sale or License Joint ventures and strategic alliances Business format franchising Merchandising

Exploiting IP Assets (2) Better bargaining position in licensing-in Defensive patenting, publication and Collateral for finance

Licensing Example The inventor of the “can opening system” licensed the system to Coca-Cola at 1/10 of a penny per can. During the period of validity of the patent, the inventor obtained 148,000 UK pounds a day on royalties

Franchising Examples

Merchandising Examples Character merchandising Personality Merchandising

Challenges facing SMEs with respect to Use of IPRs Enterprises worldwide and particularly in Africa largely under-utilize the intellectual property system due to: Perceived lack of relevance of the IP system Perceived high costs and complexity of IP system Limited awareness of the IP system and its usefulness Lack of qualified human resources to use the IP system

Measures Taken By ARIPO to Address Challenges facing SMEs (1) Put up a simplified IPRs filing and protection system Upgraded ICT infrastructure for ARIPO and member states to enable on-line filing, processing and management of IPRs Awareness-raising through seminars and workshops targeting SMEs

Measures Taken By ARIPO to Address the Challenges facing SMEs (2) Promotion, development and harmonization of IPRs in the member states Provision of Technological Information Services through searches and publication(e.g. the ARIPO Journal) Capacity building and training (offer a Masters Degree in Intellectual Property)

jkabare@aripo.org