How design rights can add value to a business

This briefing looks at how design rights can add effective and affordable protection and value to a business. It will:

• Give a brief summary of the existing design rights, the protection they offer, and how they differ from each other; and
• Show how design rights can provide protection across business sectors.

Design rights: a summary

There are four main design rights available in the UK:

UK registered design

What does it protect? It protects the appearance of the whole or part of a product resulting from features of, in particular, the lines, contours, colours, shape, texture, materials, of the product and/or its ornamentation.

When does the right arise? On registration – application must be made within 12 months of first being made available to the public.

Is it a monopoly right? Yes – this means that a third party can be prevented from using a design which does not produce on the informed user a different overall impression from the registered design, even if they created it independently.

How long does it last? Initial five year term is renewable every five years, up to a maximum of 25 years.

Community registered design

What does it protect? Broadly the same as UK registered design, but protection extends across the entire European Union, which will not include the UK after 31 December 2020.

When does the right arise? On registration – application must be made within 12 months of first being available to the public.

Is it a monopoly right? Yes – this means that a third party can be prevented from using a design which does not produce on the informed user a different overall impression from the registered design, even if they created it independently.

How long does it last? Initial five year term is renewable every five years, up to a maximum of 25 years.

Community unregistered design

What does it protect? The same as Community registered design.

When does the right arise? Automatically when the product is first made available to the public.

Is it a monopoly right? No – it only prevents copying of the design.

How long does it last? For a maximum of three years.

UK unregistered design

What does it protect? It protects the shape or configuration (whether internal or external) of the whole or part of an article.

When does the right arise? Automatically on creation – when recorded in a design document or an article has been made to the design.

Is it a monopoly right? No – it only prevents copying of the design.

How long does it last? 10-15 years, depending on when the product is first made available for sale.

Community registered and unregistered and UK registered designs have traditionally protected 'aesthetic' qualities of the object, where these are new and have individual character. Examples include decorative patterns, graphic symbols, the shape of products and their packaging. UK unregistered designs protect the shape and configuration of the design where these are original and not commonplace, including functional designs that have no aesthetic element.  UK unregistered design laws will not, however, protect the design of an article which is pre-determined by its need to fit with another article so that both can work together (must-fit); or the design of the article that is dependent on the appearance of another article of which it is an integral part (must-match); or a design which is merely surface decoration.

The hidden value of design rights

Businesses are becoming increasingly aware of the advantage that design rights can give them over their competitors. Design rights can offer particularly attractive benefits over other forms of intellectual property right, for example, speed and simplicity of registration and relatively low cost. The examples below show some ways in which design rights have been adopted to meet the needs of particular industries. Clever application of design rights means that a product's value can be considerably extended:

• The relatively low costs of design registration, matched by the speed of the registration process unencumbered by lengthy review, means that design rights are perfect for manufacturers seeking to protect wide and ever-changing product ranges. The toy and fashion industries, for example, rely heavily on design protection.
• Design rights also present a unique way for companies to protect new media and digital products. While copyright will protect the underlying code of a software application, arguments that it should also protect the 'look and feel' of the results displayed on the screen are considerably harder to construct. However, the nature of design rights means that they are ideally suited to protecting digital images. This means protection of, amongst other things, video game characters.This right has also been widely used to protect graphic icons that appear in computer applications and on mobile phones.
• Registered design rights also offer the ability to achieve speedy infringement remedies – important for fast moving industries. The fashion industry has a notoriously short time for stock turnover, with fashions changing by the season, if not more frequently. The potential risks of damage mean that infringement action has to be quick and easy, injunctions have to come almost before goods reach the shop floor. The current phenomenon of no-frills fashion – clothing chains that specialise in providing the look of designer fashion at bargain basement prices – often strays into the realm of direct copying.  Community design rights have given fashion designers a quick and easy means of protecting their designs in key markets, allowing them to strike before the worst of the damage is done.

Design rights and trade marks

Many businesses are also recognising the benefit of incorporating design right protection into their broader portfolio of intellectual property rights. Design rights can sit alongside trade marks, providing a different level of protection and, crucially, a different means of enforcement. Arsenal Football Club is a good example of one such business.

Some years ago, Arsenal Football Club was locked in the middle of a long trade mark and passing off battle against a seller of unauthorised replica scarves. Arsenal was seeking to stop the sale of replica goods which made unauthorised use of the club logo – a heraldic crest with a picture of a cannon. The case was eventually decided by the Court of Appeal in Arsenal's favour, but a number of earlier judgments had gone the other way.

As a result of the difficulties it was facing in enforcing its rights, Arsenal took the decision to re-brand, abandoning the logo used by the club for 53 years. The new logo is still made up of a shield containing the image of a cannon, but it differs in almost every single regard from the old logo. The heraldic shield has been replaced by a stylised 'shield image'. The breach-loading cannon, circa 1750, was replaced by a muzzle-loading cannon from the 15th century. The cannon even points in a different direction.

Cynics saw it as a way of Arsenal forcing fans to replace branded merchandise, but if anything this was only a side effect. Arguably the real motivation behind the re-brand was to create a logo with sufficient novelty to be able to benefit from design registration as well as trade mark protection. The fact that unlicensed use of a registered design is in itself sufficient to prove infringement means that Arsenal now has a very direct means of stopping unauthorised replica sales.

Design rights can complement trade mark protection.  If a word is registered as a trade mark and that mark also has a stylistic element, the stylistic element can be registered as a design.  The advantages of design protection over trade mark protection (which is also available) are that:

• It is quick to register;
• There is no lengthy review by the design registry;
• The use of the design is not tied to any class of goods;
• Continuous usage of the design is not necessary to keep the right to exploit the design; and
• You can register many variants of one design in order to make your design protection as wide as possible.

How should I exploit my designs?

Adding design features to a product is an increasingly popular way of giving it a competitive edge by making it distinctive and attractive to customers. A fabulous design can turn a product into am instantly recognisable brand. The iPhone is just one example.  So how can these design features make money for your business?

• Designs can transform a mere product into a brand desired by customers and increase and consolidate market share.
• Licensing design rights can provide a valuable income stream.
• Designs can be used as a way of raising capital, for example, as security for a loan.
• The rights to exploit a design can be sold.
• A reputation for innovative product design can add significant value to your business.