IP goes to the market
…or how to manage intellectual property upon concluding a H2020 project and moving towards commercialisation.
R&D&I projects are a melting pot for innovation. Nevertheless, few products and solutions end up on the market despite their clear potential to become commercially viable. Commonly, this has to do with a lack of clear agreements around the IP generated in the project.
If you have ever found yourself in a similar situation, you will appreciate that to secure the path towards successful and smooth commercial exploitation, the first and most important step is clearly identifying the assets intended for commercial exploitation and who has rights over them.
IP within the framework of a H2020 project
In general, the principles regulating IP management within Horizon 2020 projects are stated in the H2020 Annotated Model Grant Agreement whereas project specific IP is agreed upon signing the consortium agreement (and other background documentation). Consortium members thus establish access rights and how to manage (i) existing assets (background IP) and (ii) those foreseen to be developed following project work (foreground IP). In the world of Earth Observation applications, these may include proprietary algorithms, novel machine learning techniques or platforms offering different types of resources.
Discuss IP very early in the project development and make sure that decisions regarding known background IP and foreseen foreground IP are reflected in the consortium agreement. Perform an IP audit at several intervals during the project, to ensure IP assets are well understood and appropriate exploitation strategies are agreed among partners. Make sure that all partners agreed upon and prepare for collaboration after the end of the project.
IP exploitation after the end of a H2020 project
When you own all the assets concerned, the commercialisation and exploitation are rather straightforward and entirely up to you. We will therefore focus instead on circumstances when the solution’s IP is jointly owned or the assets are property of different project partners. For instance, although partners may enjoy access rights to a partner’s IP when implementing a H2020 project, this is unlikely to be granted beyond the end of the project, and even less so for commercialisation purposes, unless otherwise stated in a subsequent agreement between the parties. This implies collaboration between you and others, even if different legal solutions can be implemented here for managing the concerned IP, for example:
Non-disclosure agreements (NDA) could accompany each phase of negotiation with partners with whom confidential information (algorithms, trade secrets, know-how) may be disclosed in order to prevent misuse – and in order to define what “misuse” comprises. Sometimes, confidentiality agreements extend beyond the end of the project (e.g., as per the consortium agreement or bilateral contracts). In this case, if the plans for future commercialisation go beyond what is already covered, the NDA should be updated. An NDA will always be required when you wish to involve a third party who has no pre-existing confidentiality obligations towards others.
Memoranda of understanding and/or cooperation agreements may also contain confidentiality clauses, just as an “IP license” would, but these generally set the ground for a broader cooperation. They can be binding or not, depending on their actual content. For instance, while typically non-binding, a memorandum of understanding can state that it is either binding in its entirety, or in specific clauses, e.g. those on confidentiality, which may also be binding for longer than other provisions.
Merging or registering as a company is the option requiring the most commitment – and cost. Registration formalities could be expensive and complicated and may involve merging and adapting existing company structures..
Regardless of the type of document you and your partners choose to sign (contract, license, memorandum of understanding, etc.) it is crucial for everyone to clearly understand which parts are binding and under which conditions and to make sure everyone’s interest is protected, to the best possible extent.
You are not alone
Ultimately, completing these steps depends on your own scientific and technical excellence, your business acumen, and your fortitude. But even if you do possess these qualities, you may find that you need help navigating the complexities of a competitive EO solutions market – and we would be happy to offer it! If any of the situations described above sound familiar, feel free to contact us!
We will keep posting stories of IP and innovation, trying to ensure increasing depth and wider perspective so that we can capture the reality of actors developing EO solutions. Stay tuned!