Some of your most valuable intellectual property is protected the moment you create it. Some of it is protected only if you register it. Knowing which is which will help you understand what you own, what you need, and whether there are gaps to fill.
IP rights fall into two broad groups: registered rights, which you apply for at the Intellectual Property Office (in the UK) or an equivalent overseas office, and unregistered rights, which arise automatically. Here is how they differ, and why it matters for your business.
Registered IP: rights you apply for
Registered rights exist only once an application is granted. In exchange for a fee and an examination process, you receive a certificate of registration and an entry on a public register. The main registered rights are:
- Trade marks protect signs that identify your goods or services: names, logos, slogans, even colours or sounds. Registration lasts 10 years and can be renewed indefinitely.
- Registered designs protect the appearance of a product, such as its shape. Protection runs in five-year terms up to a maximum of 25 years.
- Patents protect inventions that are new and inventive. A patent lasts up to 20 years, subject to renewal fees.
The key advantage: a registered design or patent is a true monopoly. You can stop others using it even if they came up with the same thing independently.
Registration is also territorial. A UK registration protects you only in the UK, so if you trade abroad you may need to register in those countries too.
Unregistered IP: rights that arise automatically
Unregistered rights cost nothing to obtain. They come into being when the work is created or the goodwill is built. However, because there is no certificate, they are harder to prove.
Businesses often don't realise that they own unregistered IP rights. In the context of a business sale, this risks leaving out valuable assets.
Some of the key unregistered IP rights are:
- Copyright protects original literary, dramatic, musical and artistic works, as well as software, films, sound recordings and more. There is no registration system in the UK. For most works, protection lasts for the author's life plus 70 years.
- Unregistered design rights: UK unregistered design right can protect the shape of a product for up to 15 years, and a separate right protects its appearance for 3 years from first disclosure in the UK.
- Passing off is a common law action protecting the goodwill in an unregistered brand (i.e. a name or logo that may not be registered as a trade mark). You must show goodwill, a misrepresentation by the other party and damage.
- Confidential information and trade secrets are protected under the law of confidence (and by legislation) for as long as the information stays secret.
A key limitation: copyright and unregistered design rights only protect against copying. If a competitor creates the same thing or something similar on their own, they will not have infringed.
The practical differences
Registration buys you certainty and something that feels more tangible. It also grants monopoly rights.
Unregistered rights are free, with no registration process, but they are more difficult to prove and the scope of cover can be less clear.
Registered IP
How it arises: Application to the UKIPO or the relevant overseas IP office, examination and grant.
Cost: Filing, renewal and often professional fees.
Proof of ownership: Public register.
Scope: Monopoly: copying need not be shown.
Duration: Fixed terms, renewable for trade marks.
Enforcement: Generally (though not always) quicker and cheaper to enforce.
Unregistered IP
How it arises: Automatically, on creation or through trading.
Cost: Free to obtain.
Proof of ownership: You must prove creation date, authorship or goodwill.
Scope: Usually protects only against copying or misrepresentation.
Duration: Varies widely.
Enforcement: Often evidence-heavy and costlier to litigate.
It is not either/or, even within one product or service. A single product could involve a registered trade mark for the brand name, copyright in its artwork, and a registered design for its shape. There is also likely to be goodwill in the brand if the product is sold to UK customers.
Why it matters when you sell
Knowing what IP you own is not just about stopping copycats or infringers. If you ever want to sell your business or bring in investors, buyers will look closely at your IP during due diligence.
They will want evidence that you own, or have the right to use, everything core to your product or service: the brand, the software (including open source), the designs, the know-how. They will also want to see that you have protected it properly. Gaps such as unregistered brand names or logos, code written by a freelancer with no written assignment, or a key licence that cannot be transferred can reduce the price and lead to demands for extra warranties and indemnities. It could even be a deal-breaker.
What this means for your business
- Register what is core to your brand. Relying on passing off for your business name is possible, but proving goodwill is time-consuming and expensive. Generally speaking, a trade mark registration will be easier to enforce.
- Keep records of creation. Dated drafts, design files and version histories make unregistered rights much easier to prove.
- File before you disclose. A patent can be lost if the invention is made public before filing. Ensure that you have non-disclosure agreements (NDAs) in place before discussing your idea with a third party.
- Check who owns what. Work created by employees in the course of employment usually belongs to the employer. Work by freelancers and agencies usually does not, unless assigned in writing.
- Protect secrets actively. Confidentiality agreements and access controls are what keep a trade secret a secret.
This article is for general informational purposes only and does not constitute legal advice. If you would like to discuss your specific situation, please get in touch with the ClearCube team at hello@clearcube.law