Mandatory patent insurance to protect intellectual property on cards in Spain

Enrique Hernández Bento, Subsecretary, Industry Ministry, said that a bill demanding Spanish companies take out the new cover could be presented to parliament in just a few months as part of an overhaul of intellectual property regulations in Spain. Although also aimed at large companies, the mandatory patent insurance would particularly target small and medium-sized firms. It is these smaller operations that face the biggest difficulties in safeguarding their intellectual property, said Mr Hernández. In creating the new coverage, the government expects to reduce the costs for SMEs wanting to ensure that their innovative ideas are properly protected. Larger firms may also be less inclined to pinch the ideas of smaller rivals in fear of court action.hideThe policies would cover the costs of litigation when intellectual property rights are thought to have been infringed. Such action tends to be complex and expensive, falling therefore out of the reach of most SMEs that as a group constitute 96.7% of all registered firms in Spain and produce over two thirds of the country's GDP. Large industrial groups are already able to find solutions for intellectual property risk in international markets, said experts during the presentation of a study on patent insurance published by Fundación Mapfre, the insurance think tank sponsored by Spain's biggest insurance company. Patent insurance markets are however still in development. Not only in Spain. Therefore, speaking at the study's launch, Mr Hernández said the Spanish authorities will be 'innovative', if necessary, when devising an insurance solution for intellectual property risks. The study was written by Elena F Pérez Carrillo, a law expert at the Santiago de Compostela University, and Frank Cuypers, a former Head of Actuary at Zurich who now works at Prime Re Services in Switzerland. The authors noted that intellectual property insurance coverages have been marketed in the US since the late 1980s, but that they remain largely ignored by patent holders. In Europe, the European Commission has celebrated the fact that the coverage has been spreading in some countries. But there is still no pan-European solution on offer targeted at small and mid-sized companies. Some countries, such as Germany and Denmark, have modest initiatives in this area, while in others, such as France, efforts to launch commercial patent insurance coverages have failed to attract interest from buyers. For the Spanish market, the report's authors propose the creation of coverage designed for SMEs, research centres and individual scientists and researchers, but which could also expand or adapt to other kinds of buyers. The basic coverage would pay for legal assistance in court cases where buyers believe that their intellectual property rights have been infringed. More comprehensive policies would also include other costs such as legal bonds and defence costs in the eventuality that the client is the target of a counter-suit by a third party. Losses would be covered to a maximum of €100,000 or €200,000, depending on the coverages selected, with excesses of €5,000 and €10,000 respectively. Making the insurance mandatory and restricting its coverage to Spain would help to keep premium costs down, the study argues. The authors estimate that a basic policy could be sold for about €90 a year in Spain. Although patent litigation is still not very common in the country, the report's authors expect the number of cases to pick up in the future.

Mandatory patent insurance to protect intellectual property on cards in Spain

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