TECHNOLOGY ENTREPRENEURSHIP

(ENT600)

UNIT 7 :

INTELLECTUAL PROPERTY

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 1

 INTRODUCTION

• Any product of human intellect and

creative endeavor such as innovation,
design, trading style, artistic work or
literary work has value in the marketplace.

• The term “intellectual” is used to portray

the involvement of human imagination,
creativity, and inventiveness.

Entrepreneurship Dept, FBM

ENT600/UNIT 7 : INTELLECTUAL PROPERTY 2
(2009)
DEFINITION OF INTELLECTUAL PROPERTY

• Intellectual Property (IP) is defined as a

legal entitlement attached to the
expressed form of an idea, or to some
other intangible subject matter, that
enables its holder to exercise exclusive
control over the use of the IP.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 3

 PURPOSE

• The intellectual creations and its inherent

value can be protected from being
exploited by other parties through
intellectual property protection.

• The concept of intellectual property means

that any unauthorized use of the creation
or works by unauthorized parties is
prohibited and protected by law.

Entrepreneurship Dept, FBM

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TYPES OF INTELLECTUAL PROPERTY (IP)

There are five (5) types of IP rights which provide

protection for inventions or creations against
infringement by others:
1. Patent
2. Copyright
3. Trademark
4. Industrial Design
5. Geographical Identifications
6. Layout Design of Integrated Circuits
7. Trade Secret

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 5

 PATENT

Entrepreneurship Dept, FBM

ENT600/UNIT 7 : INTELLECTUAL PROPERTY 6
(2009)
 TYPES OF INVENTION PROTECTION

• In Malaysia , technological inventions are

protected under the Patents Act 1983.

• The Act covers two (2) key forms of

protection:
1. Patent
2. Utility Innovation

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 7

 Cont…
Types of Invention Protection

(1) PATENT
• A patent is an exclusive right granted for an
invention, which is a product or a process that
provides a new way of doing some things or offers a
new technical solution to a problem.
• According to Patents Act 1983, a patent is an
intellectual property right granted to an inventor
giving him or her the exclusive right to make, use,
or sell an invention for a limited time of period (20
years).
• Renewal of IP right will be extended to 10+5+5
years from the date of filing.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 8

 Cont…
Types of Invention Protection

(2) UTILITY INNOVATION

• Utility innovation is an exclusive right granted for a
minor invention which does not require to satisfy the
test of inventiveness as required of a patent.
• Utility innovation provides intellectual property right for
those incremental and lower level inventions that would
not be sufficiently inventive to qualify for a standard
patent. This is due to the inventive threshold being
lowered compared to a standard patent, that is, the
utility innovation requires an innovative action rather
than an inventive action.
• Renewal utility of IP right will be extended to 10+5+5
years from the date of filing.
Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 9
 Why Protect an Invention?

• A patent or utility innovation protection gives the

owner of the patent/utility innovation the exclusive
right to stop others from manufacturing, using and/or
selling the owner’s invention in Malaysia without the
owner’s consent or permission.

• A patent owner has the right to use the patented

invention, or may license to other parties to use the
invention, or sell the right of the invention to
someone else who will then become the new owner
of the patent.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 10

 Who Can Apply for a Patent?

• Any person may make an application for a

patent or for a utility innovation either alone or
jointly with another person.
• The word “person” is not limited to natural
persons and thus also includes, for example a
company.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 11

 Patentable Inventions
For an invention to be patented, it must satisfy the following
criteria:
1. Functional/Technical
– the invention must relate to how something works, what
it does, what it is made of, or how it is made.
2. New
– the invention has not been publicly disclosed in any
form, anywhere in the world.
3. Involve an Inventive Action
– the invention that could not be figured out by a person
with average knowledge of the technical field.
4. Industrially Applicable
– the invention must be capable of being made or used in
an industry (it can be mass produced).
Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 12
 Non-Patentable Inventions
• Discoveries, scientific theories and mathematical methods.
• A literary, dramatic, musical or artistic work.
• Plant or animal varieties or essentially biological processes for
the production of plants or animals, other than man-made living
micro-organisms, micro-biological processes and the products of
such micro-organism processes.
• Schemes, rules or methods for doing business, performing
purely mental acts or playing games.
• The presentation of information, or some computer programs.
• Methods for the treatment of human or animal body by surgery
or therapy, and diagnostic methods practiced on the human or
animal body.
• Anything immoral or contrary to public policy.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 13

 Pursuing a Patent
Patent expert recommends the following basic guideline:
1. Pursue patents that are broad, or commercially
significant, and offer a strong position
• The patent must be significantly novel or proprietary.
• Record and have them witnessed so that
documentation secures a proprietary position.
2. Prepare patent plan in detail
• Plan should outline the cost to develop and market
the innovation.
• Analyze competition and technological similarities to
the idea.
• Detail out the perceived value of the innovation.
Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 14
 Cont…
Pursuing a Patent
3. Have your actions relate to your original patent plan?
• Stick to the original patent plan during the early stages of
establishing the patent
• At a later stage, the plan may change – e.g. licensing the
patent vs keeping the patent
4. Establish an infringement budget
• Infringer may fear legal damages
• Thus prepare realistic budget for prosecuting violation of the
patent.
5. Evaluate the patent strategically
• Patent process typically take 3 years.
• Compare this with the lifecycle of the proposed innovation or
technology.
• Will the patent be worth defending in three years or will
enforcement cost more than the damages collected.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 15

 Term of Protection for Patents

• A patent is protected 20 years from the date of filing.

• A utility innovation is protected 10 years from the date of
filing. The term may be extended twice, each on a 5 –
year basis (i.e. 10 + 5 + 5), subject to use, therefore
providing a total protection period of 20 years
• Once a patent expires, the owner no longer holds the
exclusive rights to the invention.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 16

 Where to Apply?
• An applicant must file a patent or utility innovation application with the
Intellectual Property Corporation of Malaysia (in Kuala Lumpur or at
the branch offices located in Sabah and Sarawak) which will assess
whether it meets the requirements of the Patents Act 1983.
• The total cost for patent application is RM1,050 and for utility
innovation is RM900 (as stated in http://www.myipo.gov.my
/index.php/faq/patent.html as at June 2009).
• Applications, correspondence and enquiries should be directed to:
The Registrar
The Patent Registration Office
Intellectual Property Corporation of Malaysia
32nd Floor, Menara Dayabumi
Jalan Sultan Hishamuddin
50623 Kuala Lumpur
Tel : 603-2263 2100
Fax : 603-2274 1332

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 17

 International IP Protection

• Exporting firms still face problems of imitations

and counterfeit products.
• The solution to this is internationalizing the
patent law to protect firms operating in the global
market.
• To facilitate patent filing in multiple countries with
a single office rather than filing in each separate
country, the Patent Cooperation Treaty (PCT)
with over 100 participating countries was
established.
Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 18
 Cont…
International IP Protection

The World Intellectual Property Organization

(WIPO) in Geneva is administering this facility.
• This arrangement helps to reduce the cost of
multiple patent applications by firms operating in
the global markets.
• This will indirectly contribute to the economy of
the nation because it helps to curtail imitation
and counterfeit products.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 19

 COPYRIGHT

Entrepreneurship Dept, FBM

ENT600/UNIT 7 : INTELLECTUAL PROPERTY 20
(2009)
 COPYRIGHT

Copyright is a form of intellectual

property protection or exclusive right given
to individuals who produce original works
of art and literature, music, films, sound
recording, broadcasts, derivative works
and computer programs.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 21

 Copyright in Malaysia

• Copyright protection in Malaysia is governed by the

Copyright Act 1987.
• A work is protected automatically upon fulfillment of the
following conditions:
1. Sufficient effort has been spent to make the work
original in character.
2. The work has been written down, recorded or
reduced to a material form.
3. The author is a qualified person or the work is made
in Malaysia or the work is first published in Malaysia.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 22

 What Can Copyright Protect?

1. Literary works (e.g. novels, instruction manuals, computer

programs, song lyrics, newspaper articles and some types of
database).
2. Dramatic works (e.g. theatre presentation and stage plays).
3. Musical works (e.g. composition).
4. Artistic works (e.g. paintings, engravings, photographs,
sculptures, collages, architecture, technical drawings,
diagrams, maps and logos).
5. Layouts or typographical arrangements (e.g. used to
publish a work for a book).
6. Recordings (e.g. jingles, sounds and films).
7. Broadcasts (e.g. documentary, live coverage of events).
8. Derivative works (e.g. producing Harry Potter movie series
from the novel of the same name).

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 23

 Ownership of Copyright
• Literary Works (including software and databases), theatrical,
musical or artistic (including photographic)
The author or creator of the work is also the first owner of any
copyright in it. In some situations two or more people may be joint
authors and joint owners of copyright.
• Film
The principal director and the film producer are joint authors and first
owners of the copyright (and the economic rights).
• Sound Recording
The author and first owner of copyright is the record producer, in the
case of a broadcast, the broadcaster; and in the case of a published
edition, the publisher.

If a work is made by an employee (in the course of his or her

employment, unless there is any contrary agreement), the copyright in
the work shall be deemed to the person who commissioned the work or
the employer.
Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 24
 Term of Protection for Copyrights

• Generally, copyright subsist during the life of the author

plus 50 years after his death.
• However, if a work has not been published during the
lifetime of the author, copyright in the work continues to
subsist until the expiration of 50 years, following the
year in which the work was first published.
• In the case of a work with joint authorship, the life of the
author who dies last is used for the purpose of
calculating the copyright duration of the work.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 25

 Legal Rights of Copyright Owners

Generally, owners of copyright works have the exclusive

rights to control:
• The reproduction of the works in any form (including
photocopying, recording etc)
• The performing, showing or playing to the public
• The communication to the public
• The distribution of copies to the public by sale or other
transfer of ownership
• The commercial rental to the public.
• These exclusive rights apply irrespective of whether the
works are copied partly or wholly.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 26

 What Constitutes Copyright Infringement?

A copyright is infringed when an UNAUTHORIZED person

performs any of the following acts:
• reproduces in any material form, performs, exhibits, shows or
plays or distributes to the public.
• communicates by cable or broadcast of the whole infringing
work or a substantial part of its original or derivative form.
• makes for sale or hire any infringing copy.
• sells, lets for hire or by way of trade, exposes or offers for sale
or hire any infringing copy.
• possesses, otherwise than for his private and domestic use,
any infringing copy.
• imports into Malaysia, otherwise than for his private and
domestic use, an infringing copy.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 27

 TRADEMARK

Entrepreneurship Dept, FBM

ENT600/UNIT 7 : INTELLECTUAL PROPERTY 28
(2009)
 TRADEMARK

• Trademark is a distinctive name, mark, symbol

or motto identified with a company’s product(s).
• A trademark is a sign which distinguishes the
goods and services of one trader from those of
another.
• A sign includes words, pictures, logos, names,
letters, numbers or a combination of these.
• A trademark is used as a marketing tool to
enable customers recognize the product of a
particular trader.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 29

 Functions of Trademark

• Origin Function – A trademark helps to identify the

source and those responsible for the products and
services sold in the market.
• Choice Function – A trademark enables consumers to
choose goods and services with ease while shopping.
• Quality Function – Consumers choose a particular
trademarks for its known quality.
• Marketing Function – Trademark plays important roles in
marketing. It is normal for consumers to make purchases
based on continuous influence of advertising.
• Economic Function – Established trademark is a
valuable asset. Trademarks may be licensed or
franchised.
Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 30
 Importance of Trademark Registration

Trademarks provide :
• Exclusive Rights - Registered trademark owners are conferred
exclusive right to use their marks in trade. They also have the right
to take legal action for infringement under the Trademarks Act 1976
against others who use their marks without consent. They can also
lodge complaints to the Enforcement Division of Ministry of
Domestic Trade, Cooperative and Consumerism (KPDNKK) for
appropriate actions under the Trade Description Act 1972.
• Legal Evidence - Registration certificate issued by the Registrar of
Trademarks under the Ministry of Domestic Trade Cooperative and
Consumerism (KPDNKK) of is a prima facie evidence of trademark
ownership. A certificate of registration serves as an important
document to establish the ownership of goods exported to other
countries.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 31

 Law Governing Trademarks

In Malaysia, a trademark is governed by:

1. Trademarks Act 1976

2. Trademarks Regulation 1997
(Amendment 2001)

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 32

 Registration of Trademark in Malaysia

• Registration of trademark is NOT compulsory in

Malaysia.
• Unregistered trademark may still obtain protection under
Common Law by virtue of used and reputation.
• Thus taking action against infringer can still be applied.
• However protection through usage is difficult and
tedious.
• The unregistered trademark owner must convince
the court that the infringing act misleads the public.
• The infringing goods and services may be mistaken
from their own goods and services.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 33

 Registrability of Trademark
• Not all trademarks can be registered.
• For registration, trademarks for goods and services must be
distinctive and may take the following terms:
✔ An invented word or words.
✔ Applicant’s signature.
✔ Words with no direct relation to goods or services,
geographical name or surname.
✔ Any distinctive sign such logos, pictures, symbols, etc
✔ Not deceptive, confusing, contrary to law, scandalous or
offensive.
✔ Not identical or similar to earlier registered trademarks.
✔ Not identical or similar to well-known trademark.
Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 34
 Cont…
Registrability of Trademarks
• A trademark cannot be registered if it contains words or
representation prohibited under Trademarks Act 1976 and
• Trademarks Regulation 1997 such as:
Patent, Patented, By Royal Letters Patent, Registered,
Registered Design and Copyright
His Majesty Yang Di Pertuan Agong, Her Majesty Raja
Permaisuri Agong, The Royal Highness Sultans and Their
Excellencies Yang Di Pertuan Negeri.
Royal Imperial Crown, Arms, Crest, Armorial Bearings or
Insignia.
The Royal Army and Royal Malaysian Police
Red Crescent, Geneva Cross in red and Swiss Federal
Cross in white or silver on red ground.
Words or representation or ASEAN and National Flower.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 35

 Cont…
Registrability of Trademarks

• Trademarks registered in Malaysia are not

protected abroad.

• If protection of trademarks is required overseas,

it is necessary to apply for registration abroad
separately.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 36

 Registration Process
• Every application will be examined to ensure
registrability.
• If there are any objections to registration of a particular
trademark, the applicant may apply for hearing.
• Trademarks accepted will be advertised in the
government gazette.
• If no opposition the trademarks will be registered.
• Registration Certificate will be issued.
• Application Fee:
✔ Application Fee : RM250
✔ Advertisement in Government Gazette and Issuance
of Certificate RM450
Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 37
 Term of Protection for Trademarks

• Valid for 10 years from the date of

application and may be renewed every 10
years.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 38

 INDUSTRIAL DESIGN

Entrepreneurship Dept, FBM

ENT600/UNIT 7 : INTELLECTUAL PROPERTY 39
(2009)
 INDUSTRIAL DESIGN

• An industrial design is the ornamental or aesthetic

aspect of an article.
• The design may consist of three-dimensional
features such as the shape and configuration of
an article, or two-dimensional features, such as
pattern and ornamentation.
• The design features must be applied to an article
by any industrial process or means of which the
features in the finished article appeal to eye.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 40

 Ownership Rights

• A registered industrial design provides an

exclusive right to make, import or sell or hire out
any article to which the design has been applied.

• The owner of a registered design has the right to

take legal action against an infringer within 5
years from the act of infringement.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 41

 What is a Registrable Industrial Design?

• An industrial design must be new at the date of

application.

• A design is considered as new only if it has not

been made available or disclosed to the public in
any way whatsoever in Malaysia before the filing
date.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 42

 What Sort of Designs is Excluded from
Registration?
An industrial design is NOT registrable if:
• It does not have a clear aesthetic appearance.
• It is a method or principle of construction.
• Designs features dictated solely by function.
• Integral parts which consist of features that dependent
upon the appearance of another article.
• Differs only in immaterial details or in features commonly
used in the relevant trade (trade variants).
• The designs those are contrary to public order or
morality.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 43

 Filing of Industrial Designs

• As claims are based on a "first-to-file" rule basis,

filing of an industrial design should be made at
the earliest possible time or before an article is
disclosed to the public.

• Prior disclosure will destroy the novelty of the

design. Therefore, extreme care should be
exercised to ensure secrecy of the design.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 44

 Term of Protection for Industrial Design

• A registered industrial design is given an initial

protection period of 5 years from the date of
filing and is extendable for a further two
consecutive terms of 5 years each.

• The maximum protection period is 15 years.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 45

How Extensive is Industrial Design Protection?

• An industrial design registered in Malaysia is

only protected in Malaysia.

• In order to have your designs protected in other

countries, applications for registration will have
to be filed within six (6) months from the earliest
date when it was first filed in any of the Paris
Convention member countries.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 46

 Who Can Apply for Design Registration?

• Only the owner of a design may apply to register the

design, though an agent can be authorized to make
application.
• Where an applicant's ordinary residence or principal
place of business is outside Malaysia, the applicant
shall appoint an agent registered in the Register of
Industrial Designs Agent.
• All application for the registration of industrial design
must be lodge at the Industrial Designs Registry,
Intellectual Property Corporation of Malaysia.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 47

 TRADE SECRETS

Entrepreneurship Dept, FBM

ENT600/UNIT 7 : INTELLECTUAL PROPERTY 48
(2009)
 TRADE SECRETS

• Information that is critical to the business success but

does not qualify for patent, trademark, copyright, or
industrial design protection.

• Confidential information that the business needs to keep

it secret to help maintain its competitive advantage.

• Any formula, pattern, physical device, idea, process or

other information that provides the owner of the
information with a competitive advantage in the
marketplace.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 49

 Characteristics of Information
That Can be Classified as Trade Secrets

• Not known outside the company.

• Known only inside the company on a “need-to-know”
basis.
• Safeguarded by stringent efforts to keep the information
confidential.
• Valuable and provides the company a compelling
competitive advantage.
• Developed at great cost, time and effort.
• Cannot be easily duplicated, reverse engineered or
discovered.
• Can last longer than the term of a patent.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 50

 How to Protect Trade Secrets?

• Physical Methods
– Restricting access (access to confidential documents
restricted to certain key personnel).
– Labeling documents (confidential documents are stamped
“Private & Confidential”, “Restricted”).
– Password protection (for confidential computer files).
– Logbooks for visitors and access to confidential materials.
– Adequate overall security measures (alarm, security
personnel).
• Written Confidentiality Agreement
– a firm asks employees to sign a confidentiality/
nondisclosure agreement. If they then tell anyone about it,
this is a breach of confidence and you can take legal action
against them.

Entrepreneurship Dept, FBM (2009) ENT600/UNIT 7 : INTELLECTUAL PROPERTY 51

 References

• http://www.myipo.gov.my/ retrieved on Feb 10, 2010.

• http://www.wipo.int/portal/index.html.en retrieved on
June 26, 2009.
• http://www.ipo.gov.uk/ retrieved on June 26, 2009.
• http://www.ipaustralia.gov.au/index.html retrieved on
June 26, 2009.
• B.R. Barringer, R.D. Ireland, “Entrepreneurship:
Successfully Launching New Ventures” (Upper Saddle
River, New Jersey: Pearson Education, 2008)

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