|
The concept of intellectual property (IP) treats certain intangible products similarly to physical things. In
most countries, IP laws grant certain kinds of exclusive rights over these intangibles
on the analogy of property rights, some expiring after a set period of time, and others lasting indefinitely. (See also intellectual capital.)
Overview
The purposes of these laws has varied, but most grant the "owner" a monopoly on the use or copying of the protected
"property". This was done historically to both to grant a boon to a king's favourite, as well as "to promote the progress of
science and useful arts". In the latter sense, patents and copyrights serve as incentive to inventors and authors to produce
works which benefit the public. These creators can exact a fee from those who wish to copy their invention or publish their
compositions.
Seen as an incentive to benefit the public, patent rights in particular promoted innovation by ensuring that someone who
devoted, say, ten years of penury while struggling to develop vulcanized rubber or a workable steamship, could recoup his
investment of time and energy. Using monopoly power, the inventor could exact a fee from those who wanted to make copies of his
invention. Set it too high, and others would simply try to make a competing invention, but set it low enough and one could make a
good living from the fees.
In latter years, the public benefit idea has been downplayed in favor of the idea that the primary purpose of "property
rights" is to benefit the holder. This view places a priority on the benefit of the patent or copyright holder, even to the
detriment of society at large, and has attracted some opponents, notably Richard Stallman.
In some fields, patent law has had an unintended, indeed, a perverse consequence: treating mental products like physical ones
has stifled innovation in those fields, rather than aiding it.
The four main types of non-physical things considered by this point of view are copyrights, patents, trademarks and trade
secrets. Common types of intellectual property rights include conflicting areas of law:
- Copyrights, which give the holder some exclusive rights to control some
reproduction of works of authorship, such as books and music, for a certain period of time.
- Patents give the holder an exclusive right to use and license use of an invention for a certain period, typically 20 years from the
filing date of a patent application.
- Trademarks are distinctive names, phrases or marks used to identify products
to consumers.
- Trade secrets, where a company keeps information secret, perhaps by
enforcing a contract under which those given access to information are not permitted to disclose it to others.
These rights, conferred by law, can be given, sold, rented (called "licensing") and, in some countries, even mortgaged, in much the
same way as physical property. However, the rights typically have limitations,
sometimes including term limits and other exceptions (such as fair use for
copyrighted works.)
It is important to understand that it is the rights that are the property, and not the intellectual work they apply to. A
patent can be bought and sold, but the invention that it covers is not owned at all. For this and other reasons, some people
think that the term intellectual property is misleading. Some use the term "intellectual monopoly" instead, because such
so-called "intellectual property" is actually a government-granted monopoly on certain types of action. Others object to this
usage, because of potential confusion with the economic sense of the term "monopoly." Others still prefer not to use a generic term because of differences in the nature of copyright, patent
and trademark law, and try to be specific about which they are talking about.
Legal status
Intellectual property rights are generally divided into two categories: those that grant exclusive rights only on
copying/reproduction of the item or act protected (e.g. copyright) and those that
grant not only this but also other exclusive rights. The difference between these is that a copyright would prevent someone from
copying the design of something, but could not stop them from making that design if they had no knowledge of the original held by
the copyright holder. A patent, on the other hand, can be used to prevent that second person from making the same design even if
they had never heard of or seen the original. Patent rights can thus be more powerful, and generally harder to obtain and more
expensive to enforce.
There are also more specialized varieties of so-called sui generis
intellectual property rights, such as circuit design rights (called mask work
rights in USA law, protected under the Integrated Circuit Topography Act in Canadian law, and in European Community Law by Directive 87/54/EEC of 16 December 1986 on the legal protection of
topographies of semiconductor products), plant breeder rights, plant variety rights, industrial design rights, supplementary protection certificates for pharmaceutical products and database rights (in European
law).
Types and scope of intellectual property
Intellectual property may be analysed in terms of its subject matter, the actions it regulates in respect of the subject
matter, the duration of particular rights, and the limitations on these rights. Intellectual property law is conventionally
categorized according to subject matter: inventions, artistic expression, secrets, semiconductor designs, and so on. Intellectual
property law regulates what people may legally do with these inventions, expressions and so on. The regulations
regarding each subject matter area tend to form distinct bodies of law; the rules permitting reproduction without license of
patented inventions and copyrighted expression are entirely independent of one another.
Generally, the action regulated by intellectual property is unauthorized reproduction. However, as indicated above, some
rights go beyond this to grant a full suite of exclusive rights on a particular idea or product. Generally, it is true to say
that intellectual property rights grant the holder the ability to stop others doing something (i.e., a negative right), but not
necessarily a right to do it themselves (i.e., a positive right). For example, the holder of a patent on a pharmaceutical product
may be able to prevent others selling it, but (in most countries) cannot sell it themselves without a separate license from a
regulatory authority.
Most intellectual property rights are nothing more than the right to sue an infringer, which has the effect that people will
approach the rightholder for permission to perform the acts covered by the rightholder's exclusive rights. The granting of this
permission is termed licensing, and IP licenses may be used to impose conditions on the licensee, generally the payment of a fee
or an undertaking not to engage in particular forms of conduct. In many jurisdictions the law places limits on what restrictions
the licensor (the person granting the licence) can impose. In the European
Union, for example, competition law has a strong influence on how
licences are granted by large companies.
A license is 'permission' to do something, in contract form. Therefore a license is only required for activities which fall
under the exclusive rights in question. The intellectual property laws of certain countries provides for certain activities which
do not require any license, such as reproduction of small amounts of texts, sometimes termed fair use. Many countries' legal systems afford compulsory licenses for particular activities, especially in the
area of patent law.
Many intellectual property rights are awarded by a government for a limited period of time. Such rights are justified as a
reward for creating intellectual works. Economic theory typically suggests that a free market with no intellectual property
rights will lead to too little production of intellectual works relative to an efficient outcome. Thus by increasing rewards for authors, inventors and other producers of intellectual
capital, overall efficiency might be improved. On the other hand, intellectual property law could in some circumstances lead to
increased transaction costs that outweigh these gains (see
Coase's Penguin). Another consideration is that restricting the
free reuse of information and ideas will also have costs, where the use of the best available technique for a given task or the
creation of a new derived work is prevented.
Arguments against the term Intellectual Property
The term intellectual property is problematic because the rights conferred by IP laws are limited, in contrast with
the legal rights associated with property interests in physical goods or land. Not entirely coincidentally, the presence of the
word property in the term favours the position of proponents of the expansion of intellectual property rights, who may
thereby more readily draw on the rhetoric of property itself to remove the many restrictions built into intellectual property law
which would be inappropriate if applied to physical goods. For instance, most nations grant copyrights for only limited terms,
and allow copyright holders to control only the duplication, and not the sale or modification of physical copies of a work.
A common argument against the term Intellectual Property is that information is fundamentally different from physical property
in that a "stolen" idea or copy does not affect the original possession. Another, more specific objection to the term, held by
Richard Stallman, is that the term is confusing . It implies a
non-existent similarity between copyrights, patents, trademarks, and other forms of intellectual property which
makes clear thinking and discussion about various forms difficult. Furthermore, most legal systems, including that of the
United States, imply that intellectual property rights are a government
grant, rather than a right held by citizens.
Though it is convenient for beneficiaries to regard intellectual rights as akin to "property", most items protected by IP law are not physical objects "ownable" in the traditional sense. For
example, the holder of the copyright in a book has the legal right to make and
sell copies of the book, and the right to forbid others from making and selling copies of the same book. By analogy, then, he can
be said to "own" the words in a similar way to which he might own the press on which they were printed, because ownership of a physical object also confers the right to forbid others from using the
object.
Opponents of the term also point out that the law itself treats these rights differently than those involving physical
property. To give three examples, copyright
infringement is not punishable by laws against theft, but rather by an entirely
different set of laws with different penalities. Patent
infringement is not a criminal offense although it may subject the infringer to civil liability. Possessing stolen physical
goods is a criminal offense while mere possessing of goods which infringe on copyright is not.
Others would argue that the law is simply recognising the reality of a situation. In some jurisdictions a lease of land (e.g.
a flat or apartment) is regarded as intangible property in the same way that copyright is. In these cases too the law accepts
that the property cannot be stolen - if someone moves into the flat and prevents you from living there they are not regarded as
'thieves of the lease' but as 'squatters' and the law provides different remedies.
History
It is not exactly clear where the concept of intellectual property originated.
The first patent in England was granted by Henry VI in 1449 to a Flemish
man a 20 year monopoly (co-incidentally, the current length of UK/EU patents is still 20 years) on the manufacture of stained
glass (destined for Eton College). This was the start of a long tradition
by the English Crown of the granting of "letters patent" (meaning 'open letter',
as opposed to a letter under seal) which granted "monopolies" to favoured persons (or people who were prepared to pay for them).
This became increasingly open to abuse as the Crown granted patents in respect of all sorts of known goods (salt, for example).
After public outcry, James
I was forced to revoke all existing monopolies and declare that they were only to be used for 'projects of new invention'.
This was incorporated into the Statute of Monopolies 1623. In the reign of Queen Anne the rules were changed again so that a written description of the article was given.
Outside of England, patent law was the subject of legislative protection in the Venetian Statute of 1474.
Copyright was not invented until after the advent of the printing press and wider public literacy. In England the King was concerned by the unfair copying of books and used the royal prerogative to pass the Licencing Act 1662 which established a register of licensed books and
required a copy to be deposited with the Stationers Company. The Statute
of Anne was the first real act of copyright, and gave the author rights for a fixed period. Internationally, the Berne Convention in the late 1800's set out the scope of copyright
protection and is still in force to this day.
Design rights started in England in 1787 with the Designing & Printing of Linen Act and have expanded from there.
The term intellectual property appears to have originated in Europe during the 19th century. French author A. Nion mentions "propriété intellectuelle" in his Droits civils des auteurs,
artistes et inventeurs, published in 1846, and there may well have been earlier uses
of the term.
During the period in question, there was some controversy over the nature of copyright and patent protections in Europe; those
who supported unlimited copyrights frequently used the term property to advance that agenda, while others who supported
a more limited system sometimes used the term intellectual
rights (droits intellectuels).
The system currently used by much of the Western world is more in line with the second view, with limited copyrights that
eventually expire. Regardless, the term intellectual property has gained prominence throughout the world, as evidenced
by the United Nations World Intellectual Property
Organization (WIPO), formed in 1967.
Trends
Recently the general trend in intellectual property law has been expansion: to cover new types of subject matter such as
databases, to regulate new categories of activity in respect of the subject matter already protected, to increase the duration of
individual rights, and to remove restrictions and limitations on these rights.
Another effect of this trend is an increase in the term of the government-granted rights, and an expansion of the definition
of "author" to include corporations as the legitimate creators and owners of works. The concept of work for hire has had the effect of treating a corporation or business owner as the legal author of
works created by people while employed.
Another trend is to increase the number and type of what is claimed as intellectual property. This has resulted in
increasingly broad patents and trademarks: for instance, Microsoft attempting to
trademark the phrase, "Where do you want to go today?". Trade marks in EU law can now encompass
smells (e.g. of cut grass for tennis balls), shapes (e.g. of a soft drinks bottle), colors (e.g. red for fizzy drinks), words
(e.g. COCA-COLA) and sounds (Intel, has registered four notes). The granting of patents for life forms, software algorithms and business models stretches the initial concept of
giving the inventor limited rights to exclude the use if his invention.
Some argue that these expansions harm an essential "bargain" driven between public and copyright holders: as most "new" ideas
borrow from other ideas, it is thought that too many intellectual property laws will lead to a reduction the overall creative
output of a society. The expansion of exclusive rights is also alleged to have led to the emergence of organizations whose
business model is to frivolously sue other companies.
The electronic age has seen an increase in the attempt to use software based digital rights management tools to restrict the copying and use of digitally based works. This
can have the effect of limiting fair use provisions of copyright law and even make
the first sale doctrine (known in EU law as 'exhaustion of rights') moot. This would allow, in essence the creation of a book which would disintegrate
after one reading. As individuals have proven adept at circumventing such measures in the past, many copyright holders have also
successfully lobbied for laws such as the Digital Millennium Copyright Act, which uses criminal law to prevent any circumvention of
software used to enforce digital rights management systems. Equivalent provisions, to prevent circumvention of copyright
protection have existed in EU for some time, and are being expanded in, for example, Article 6 and 7 the Copyright Directive.
Other examples are Article 7 of the Software Directive of 1991 (91/250/EEC), and the Conditional Access Directive of 1998
(98/84/EEC).
At the same time, the growth of the Internet, and particularly peer-to-peer file-sharing networks like Kazaa and Gnutella represents a challenge to intellectual property
laws. The Recording
Industry Association of America, in particular, has been on the front lines of the fight against what it terms "piracy".
Though the industry has had some victories against services, including a highly publicized case against the file-sharing company
Napster, the increasingly decentralized nature of these networks is making legal
action more difficult.
Non-government systems of IP protection
The notion of protecting intellectual capital is much older than copyright or patent law. There have long existed
socially-enforced systems for protecting intellectual capital. These include the ancient scholarly taboo against plagiarism, along with other informal systems such as the one used by clowns to protect their unique style of makeup.
On a more modern topic, intellectual property law has been brought to bear on domain names
where trademark holders (in particular) have objected to third parties registering domain
names which they believe should be theirs. The domain name registries, many of whom are not governmental organisations, have
had to find a solution to this and therefore have dispute resolution systems which operate in parallel with national laws. The
majority of the generic top level domain names (.com, .net etc.) use the ICANN model
known as the Uniform Dispute
Resolution Policy (UDRP). Other registries, such as the .uk registry Nominet
UK have their own different systems. For example, Nominet's sytem is called the Dispute Resolution Service.
Economic view
Intellectual property rights such as copyrights and patents give the holder an exclusive right to sell, or license, the right
to use that work. As such, the holder is the only seller in the market for that particular item of intellectual property, and the
holder is often described as having a monopoly for this reason.
However, it may be the case that there are other items of intellectual property that are close substitutes. For example, the
holder of publishing rights for a book may be competing with various other authors to get a book published. In such cases,
economists may find that another market form, such as oligopoly or monopolistic competition better describes the workings of the market for the intellectual
property. For this reason, many writers prefer that intellectual property rights are described as exclusive rights
rather than monopoly rights.
If the market for the rights to some intellectual property is perfectly competitive, then the rights to that intellectual property will generally be worthless. This
is because in a perfectly competitive market, sellers are price takers and can sell to as many people as they like at
the prevailing price in the market. It costs little or nothing to grant someone the right to use a copyrighted work or patent, so
the optimal behaviour for the seller is to sell as many licenses as possible, whatever the price is, forcing the price towards
zero. Thus intellectual property rights, to be valuable, must give the holder some market power (the ability to
influence price) in the market for rights to use that intellectual property. An example may be a patent covering an idea where
another idea which is in the public domain provides the same utility and no-one is likely to accidentally stumble on and use the
patented idea. If someone were to re-invent the patented idea and use it unaware a patent exists, the patent holder can claim
damages.
The case for intellectual property in economic theory is substantially different than the case for tangible property.
Consumption of tangible property is rivalrous. For example, if one person uses a plot of land to build a home, that plot is
unavailable for use by others. Without the right to exclude others from tangible resources, a tragedy of the commons can result. Intellectual property does
not share this feature. For example, an indefinite number of copies can be made of a copyrighted book without interfering with
the use of the book by owners of other copies. Therefore, the rationale for intellectual property rests on the incentive effects.
Without intellectual property rights (or subsidies), there would be no direct financial incentive to create new inventions or
works of authorship. However, as Wikipedia and Free software demonstrate, works of authorship are written without direct financial incentives.
Moreover, many important works and inventions were created before copyright was invented. One might argue that much more
invention occurred after patents came into existance, however, one could also argue that patents were brought into law as the
power and influence of industrial interests grew.
A more elaborated view of capital suggests that the
three most common property instruments applied provide exclusive rights to use different things: copyright covers creative works and expressions of ideas, patent covers
ideas with industrial application and trademark covers means to uniquely identify
a producer or other source of reputation. The three types of instruments have different histories, different intent, and protect
(in the modern analysis that grants capital status to individual creativity, instructions, and social repute) three different
kinds of capital. Even if asserting that any of the three is property is acceptable, asserting that all three deserve it for the
same reasons is not. Yet the most common definitions in international
law confuse the three rather badly:
- "Intellectual property refers to creations of the mind: inventions, literary and artistic works, and
symbols, names, images, and designs used in commerce." (Source: WIPO )
Those who contest the idea of IP say that this assertion is propaganda for a
property view of these works or marks, and for their confusion with each other. They also prefer the older terms individual capital, instructional capital and social capital to
the more modern "intellectual capital" which has an
ambiguous status, even among believers in neoclassical
economics. It seems no one can say exactly "what" this "IP" or "IC" "is", other than to say that they are related to each
other, and that holding IC gives you the ownership of IP, and that holding IP gives you the right to be paid. This view of
political economy does nothing to suggest either is useful to
society at large, or why police or court time should go into enforcing rights.
While widely accepted in Western culture, the status of IP is disputed in India,
China and other developing
nations. Economist Lester Thurow claims that only in nations whose
culture derived from practices of Judaism, Christianity and Islam, all of which share a vision of man as "created
in God's image", is the creative power of the individual assumed to be worthy of property protection. These nations have imposed
the intellectual property system and benefit from it - the United States and the United Kingdom are the only two nations who
consistently receive net balance of payments benefits from IP. On the other hand, if incentives do increase investments in
invention and authorship, then the resulting inventions and creative works may produce net benefits to other nations--as would be
suggested by the so-called law of comparative advantage.
A more recent type of IP, the protection of databases, has been introduced by the EU in 1996. This is an important right as it
protects the information contained in a database against re-utilisation and extraction of a substantial part. The right, in order
to come into existence, requires a substantial investment and subsists alongside copyright in the database structure.
Related articles
Property, Real property,
Personal property, Fair
use, Reverse engineering, Software patent, Legal
aspects of computing, Free software, Open source, Intellectual property education, Intellectual property organization, Paris Convention for the Protection of Industrial Property,
Idea, Doha Declaration,
Intellectual rights, Logo Against Intellectual Property and Copyright, Copynorm
Types of intellectual property
Copyright, Patent, Trade dress, Trademark, Trade secret, Personality rights, Industrial
design rights, Parallel importation, Geographical indications law, Integrated circuit layout.
Resources
Bibliography
- Arthur Raphael Miller, Michael H. Davis, Intellectual Property: Patents, Trademarks, and Copyright, West Wadsworth;
3rd edition, 2000, ISBN 0314235191 (textbook particularly covering copyright and patent law)
- Michael Perelman, Steal This Idea: Intellectual Property Rights and the Corporate Confiscation of Creativity,
Palgrave Macmillan, 2002, ISBN 0312294085, (a critical discussion of
some of the social, scientific and cultural impacts of recent intellectual property developments)
- Roger E. Schechter, John R. Thomas, Intellectual Property: The Law of Copyrights, Patents and Trademarks, West
Wadsworth, 2003, ISBN 0314065997 (textbook)
External links
Lobbying organisations(in favour):
Lobbying organisations(critical to some rights which IP is used to refer to):
|