IP Rights and Food Industry

Any Agro-Food company that invests in some form of creative or intellectual output, whether it be in R&D, manufacturing, product formulation, packaging, marketing, media, or sales and distribution needs to be aware of Intellectual Property Rights.

Intellectual property pertains to any original creation of the human intellect such as artistic, literary, technical, or scientific creation. Intellectual property rights (IPR) refer to the legal rights given to the inventor or creator to protect his/her invention or creation for a certain period of time.

It is very well settled that IP play a vital role in the modern economy. It has also been conclusively established that the intellectual labor associated with the innovation should be given due importance so that public good emanates from it. There has been a quantum jump in R&D costs with an associated jump in investments required for putting a new technology in the market place. The stakes of the developers of technology have become very high, and hence, the need to protect the knowledge from unlawful use has become expedient, at least for a period, that would ensure recovery of the R&D and other associated costs and adequate profits for continuous investments in R&D.

IPR is a strong tool, to protect investments, time, money, effort invested by the inventor/creator of an IP, since it grants the inventor/creator an exclusive right for a certain period of time for use of his invention/creation. Thus IPR, in this way aids the economic development of a country by promoting healthy competition and encouraging industrial development and economic growth.

As noted by the World Trade Organization (WTO), intellectual property rights are customarily divided into two main areas:

1. Copyright and rights related to copyright

The rights of authors of literary and artistic works (such as books and other writings, musical compositions, paintings, sculpture, computer programs and films) are protected by copyright, for a minimum period of 50 years after the death of the author.

Also protected through copyright and related (sometimes referred to as “neighboring”) rights are the rights of performers (e.g. actors, singers and musicians), producers of phonograms (sound recordings) and broadcasting organizations. The main social purpose of protection of copyright and related rights is to encourage and reward creative work.

2. Industrial property

Industrial property can usefully be divided into two main areas:

One area can be characterized as the protection of distinctive signs, in particular trademarks and geographical indications.

The protection of such distinctive signs aims to stimulate and ensure fair competition and to protect consumers, by enabling them to make informed choices between various goods and services. The protection may last indefinitely, provided the sign in question continues to be distinctive.

Other types of industrial property are protected primarily to stimulate innovation, design and the creation of technology. In this category fall inventions (protected by patents), industrial designs and trade secrets.

The social purpose is to provide protection for the results of investment in the development of new technology, thus giving the incentive and means to finance research and development activities.

A functioning intellectual property regime should also facilitate the transfer of technology in the form of foreign direct investment, joint ventures and licensing.

Each form of IPRs has different requirements and grants different rights. Before the whole range of possibilities offered by modern technologies in the agricultural sector was available, inventions based on living organisms were considered natural phenomena, i.e. discoveries, and were thus not patentable. However, developments in modern biotechnology require substantial levels of investment in research and development, and its processes and products can be easily copied. The IPRs system provides a way of ensuring the financial revenues required to make the technology profitable.

In what follows we take a look at the various IP rights that are available to agro-food companies.

Patents

In a legal terminology a patent is an exclusive right granted for an invention, which can be a product or a process that provides, in general, a new way of doing something, or offers a new technical solution to a problem.  A patent provides protection for the invention to the owner of the patent. The owner can be an individual, or a group of people or organization. In order to be patentable, the invention must fulfill certain conditions as specified in the Patent Act.

Patent protection means that the invention cannot be commercially made, used, distributed or sold without the patent owner's consent. These patent rights are usually enforced in a court, which, in most systems, holds the authority to stop patent infringement.

A patent owner has the right to decide who may – or may not – use the patented invention for the period in which the invention is protected. Under TRIPS agreement of WTO, the protection is granted for a limited period, generally 20 years. The patent owner may give permission to, or license other parties to use the invention on mutually agreed terms. The owner may also sell the right to the invention to someone else, who will then become the new owner of the patent. Conversely, a court can also declare a patent invalid upon a successful challenge by a third party.

Once a patent expires, the protection ends, and an invention enters the public domain. The owner then no longer holds exclusive rights to the invention. It becomes available to commercial exploitation by others.

All patent owners are under obligation to publicly disclose information on their invention in order to enrich the total body of technical knowledge in the world. Such an ever-increasing body of public knowledge promotes further creativity and innovation. In this way, patents provide not only protection for the owner but valuable information and inspiration for future generations of researchers and inventors.

The agro-food industry is currently experiencing rapid technical advances, which are set to continue with the growing interest in, for example, functional foods; and, in view of the increasing crossover that exists with pharmaceutical chemistry and biotechnology, patents are now highly relevant. A patent may provide protection for a novel microorganism, plant or animal that has been genetically modified to produce a particular food ingredient or additive.

It may also protect a new synthetic process, a molecule produced by that process, or the use of that molecule to produce a particular effect, for example, a flavor, aroma, texture or stability. It is also possible to patent a new and improved composition, or a method or apparatus for making or testing a composition. With shelf life, nutrition and health becoming increasingly important to today’s consumer, machines, techniques and processes for testing or monitoring food quality may all provide patentable subject matter.

Robots or other machines used for performing tasks, such as packaging of food products, and different types of packaging are also candidates for patent protection.

A patent is commonly described as a “monopoly right”, meaning that it gives its owner the right to prevent everyone, other than people authorized by the owner, to use, produce, sell, import or keep anything that falls under the protection of the patent.

A patent is an item of personal property and, like any other property; it can be bought, sold or licensed. Patents have a lifespan of 20 years from the filing date of the application (subject to the payment of annual fees), and have a territorial effect.

To simplify the patenting in many countries WIPO administers Patent Cooperation Treaty. The WIPO-administered Patent Cooperation Treaty (PCT) provides for the filing of a single international patent application, which has the same effect as national applications filed in the designated countries. An applicant seeking protection may file one application and request protection in as many signatory states as needed.

Any resident or national of a Contracting State of the PCT may file an international application under the PCT. A single international patent application has the same effect as national applications filed in each designated Contracting State of the PCT. However, under the PCT system, in order to obtain patent protection in the designated States, a patent shall be granted by each designated State to the claimed invention contained in the international application.

Procedural and substantive requirements for the grant of patents as well as the amount of fees required are different from one country/region to the other. It is therefore recommended to consult any practicing techno-legal professional who is specialized in intellectual property or the intellectual property offices of those countries in which one is are interested to get protection.

Searchable Internet patent databases have significantly facilitated the access to patent information. However, given the complexity of patent documents and the technical and legal skills required, it is advisable to contact a professional patent attorney. Please note Patent is a techno-legal exercise and not just legal drafting.

Trademarks

A trademark is basically a sign that is used to distinguish the goods or services offered by one undertaking from those offered by another. A trademark is a word, a logo, a number, a letter, a slogan, a sound, a color, or sometimes even a smell, which identifies the source of goods and/or services with which the trademark is used.

Its purpose is to protect the name of the product rather than the invention or idea behind the product. Trademarks can be owned by individuals or companies and should be registered with a governmental agency, which is usually referred to as the Trademarks Office.

Generally speaking, trademarks should be distinctive and should neither be generic nor merely descriptive of the goods or services they represent. For example, the word "vegetable" cannot be registered as a trademark of a supermarket, since it is certainly descriptive of items, which a supermarket sells. In addition, it cannot be registered as a trademark for carrots, since it is a generic term for carrots. On the other hand, the word "vegetable" might well serve as a trademark for bicycles since it has little or nothing to do with bicycles.

 Trademarks should preferably not be geographical or primarily a surname. Thus, "Paris" cannot serve as a trademark for perfume. In many countries, trademarks, which comprise mere letters and/or numbers or are surnames, are considered to be indistinct.

In some instances, trademark registration can still be obtained for trademarks that are merely (i) descriptive, (ii) a surname, (iii) geographic or (iv) indistinct.

Trademarks, also known as brand names, are part of everyday life. Trademarks usually ensure a consistent level of quality - be it good or bad. A mark helps you to use your experience either to return to a desirable product or service or to avoid an undesirable one.

The symbol  should be used to represent a registered trademark, whereas the symbol “TM” should be used where the trademark is not registered.

Trademarks can be important marketing tools for your business and, unlike patents; a trademark can last forever. They also have territorial rights. As with patents, international treaties and laws are in place to make it easier for a trademark owner to register a trademark in several countries simultaneously. By filing a trademark application via the Madrid System, an international trademark can be obtained in those member states.

A trademark is registered only in connection with specific categories of goods and services. This has the interesting consequence that it can enable different companies to use very similar or identical trade names or marks, provided that the respective goods or services of each company are sufficiently different to avoid confusion. But, a valid trademark gives its owner the legal right to prevent others from using a similar mark in connection with the same or similar goods. In other words, it allows the trademark owner to prevent competitors from using marks that imitate or could be confused with an existing trademark.

Geographical Indications

The term “geographical indication” has been chosen by WIPO to describe the subject matter of a new treaty for the international protection of names and symbols, which indicate a certain geographical origin of a given product.

A geographical indication tells consumers that a product is produced in a certain place and has certain characteristics that are due to that place of production. All producers who make their products in the place designated by a geographical indication and whose products share typical qualities may use it.

It embraces all existing means of protection of such names and symbols, regardless of whether they indicate the qualities of a given product due to its geographical origin (such as appellations of origin), or they merely indicate the place of origin of a product.

This definition also covers symbols, because geographical indications are not only constituted by names, such as the name of a town, a region or a country, but may also consist of symbols. Such symbols may be capable of indicating the origin of goods without literally naming its place of origin.

The commercial significance of this relatively new term can be assessed by the fact that Geographical Indications are integral part of national, regional and international trade negotiations.

When considering geographical indications as a special kind of distinctive sign used in commerce and thus as a particular category of intellectual property, it is important to distinguish them from trademarks: a geographical indication identifies a geographical area in which one or several enterprises are located which produce the kind of product for which the geographical indication is used. Thus, there is no “owner” of a geographical indication in the sense that one person or enterprise can exclude other persons or enterprises from the use of a geographical indication, but each and every enterprise which is located in the area to which the geographical indication refers to has the right to use the said indication for the products originating in the said area, but possibly subject to compliance with certain quality requirements as prescribed.

It might well be that a geographical name is regarded in one country as a geographical indication and is protected accordingly, whereas it is considered to be a generic or semi-generic term in another country. Notorious examples for such diverging treatment of geographical names are the French names “Champagne” and “Chablis” which, in France, are only allowed to be used for products originating from a certain geographical area and produced according to certain quality standards, whereas, in the United States of America for example, they are regarded as being semi-generic names, and therefore may be also used for wines not originating from the particular area of production in France. Geographical indications are protected in accordance with national laws and under a wide range of concepts, such as laws against unfair competition, consumer protection laws, laws for the protection of certification marks or special laws for the protection of geographical indications or appellations of origin.

A number of treaties administered by the WIPO provide for the protection of geographical indications, most notably being the Paris Convention for the Protection of Industrial Property of 1883, and the Lisbon Agreement for the Protection of Appellations of Origin and Their International Registration. In addition, Articles 22 to 24 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) deal with the international protection of geographical indications within the framework of the WTO.

Trade Secrets

Trade secrets encompass manufacturing, industrial secrets and/or commercial secrets. The unauthorized use of such information by persons other than the holder is regarded as an unfair practice and a violation of the trade secret. Depending on the legal system, the protection of trade secrets forms part of the general concept of protection against unfair competition or is based on specific provisions or case law on the protection of confidential information.

The subject matter of trade secrets is usually defined in general and broad terms and includes recipes, formulations, sales methods, distribution methods, consumer profiles, advertising strategies, lists of suppliers and clients, and manufacturing processes. While a final determination of what information constitutes a trade secret will depend on the circumstances of each individual case, clearly unfair practices in respect of secret information include industrial or commercial espionage, breach of contract and breach of confidence.

Contrary to patents, trade secrets are protected without registration. For these reasons, the protection of trade secrets may appear to be particularly attractive for food industry. There are, however, some conditions for the information to be considered a trade secret. WTO agreement on TRIPS also recognizes the concept of trade secret. Compliance with such conditions may turn out to be more difficult and costly than it would appear at first glance. While these conditions vary from country to country, some general standards exist which are referred to in Art. 39 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement):

The information must be secret (i.e. it is not generally known among, or readily accessible to, circles that normally deal with the kind of information in question).

It must have commercial value because it is a secret.

It must have been subject to reasonable steps by the rightful holder of the information to keep it secret (e.g., through confidentiality agreements).

Trade secrets are widely used by food industry including multinationals. In fact, many food companies rely almost exclusively on trade secrets for the protection of their IP (although in many cases they may not even be aware that trade secrets are legally protected). It is important, therefore, to make sure that food enterprises take all necessary measures to protect their trade secrets effectively.

Trade secret protection does not require compliance with formalities such as disclosure of the information to a Government authority.

There are, however, some concrete disadvantages of protecting confidential business information as a trade secret, especially when the information meets the criteria for patentability:

If the secret is embodied in an innovative product, others may be able to inspect it, dissect and analyze it and discover the secret and be thereafter entitled to use it. Trade secret protection of an invention in fact does not provide the exclusive right to exclude third parties from making commercial use of it. Only patents and utility models can provide this type of protection.

The level of protection granted to trade secrets varies significantly from country to country, but is generally considered weak, particularly when compared with the protection granted by a patent.

Registered Designs

Registered designs protect the physical appearance of an article (or part of an article), such as its shape, configuration, pattern or ornamentation, including features of lines, contours, colors, texture or material. To register, a design must be “new”, which means it must not be the same as any known design; and have “individual character”, which essentially means that it gives a different overall impression to any previously known design.

It is possible to register a design in connection with almost any “article”, whether it is mass-produced in industry, or a unique handicraft object. In the agro-food industry, a registered design may be used to cover a new type of packaging or the features of an electrical apparatus.

Since a registered design can cover the whole or part of an object, a complicated item may be protected by many different designs. Interestingly, a registered design may even protect the appearance of a food item, for example, the shape of a teabag.

Registered designs provide similar rights to those of patents, in the sense that they can be enforced to stop unauthorized persons from using, making, selling or importing a product having an infringing design, for a maximum term of 25 years. As with other forms of IP rights, it is possible to obtain registered design rights internationally.

Copyright

Copyright relates to the expression of an idea, rather than to the idea itself. Thus, it applies to original literary, artistic or graphical works, including software programs. A copyrighted work cannot be copied, without the consent of the owner, for the term of the copyright, which, in most cases, is the life of the author (or creator) plus 70 years. The best way to indicate that a work is protected under copyright law is to display the symbol along with the name of the copyright owner and the year of the work.

Copyright is particularly relevant to the design, imagery and labeling of packaging, and also applies to two-dimensional design drawings, such as plans, for example, for new packaging or machinery.

Conclusion

In the global marketplace, agro-food companies need to look to protect their IP abroad, as well as in their country of origin. Most IP systems work internationally and so it is generally straightforward to secure protection in key foreign markets. IP is becoming rapidly more important in agro-food industry and you ignore it at your peril.

It is generally believed that in the field of agriculture, intellectual property regime will spur activity among the scientists and farmers to facilitate new knowledge that will lead to innovations. Such innovations will save countries from relying on “climate fed” agriculture and pave way to intelligently driven agricultural practices. Releasing agro-based population will expand other areas of the economy such as the tourism industry, the retail industry and other technologically oriented industries. This can also make countries to effectively join the value added biotech industry and save their populations from malnutrition and hunger. Moreover it will also attract more investment and exchange of goods from other countries.

Ago-food companies can benefit from the wealth of technological and commercial information available in patent and trademark databases to learn about recent technological breakthroughs, identify future partners, and find out about the innovative activities of competitors.

Finally, managing IP effectively and using it to devise business strategies is an increasingly critical task for entrepreneurs worldwide.