In the highly competitive market, it is tough for a startup company to protect their intellectual property rights. The intellectual property protection allows startup companies to maintain and expand their distinctive and differentiating product or service offers. So, maintaining a competitive age through inventive products and services supported by well-crafted intellectual property rights, like trademarks, patents, design, copyrights and more, is a startup’s most important success criteria. 

In Nepal, the protection and enforcement of Intellectual Property are governed by Patent, Design and Trademark Act, 1965 (2022) and Copyright Act, 2059 (2002). Startups depend on intellectual property rights to ensure their unique products, concepts and services from competitors to form a competitive advantage.

It is crucial for a startup to protect its intellectual property because more than 60% of the world economy is generated by the Intellectual Property. The economic component of intellectual property is an opportunity for the recurrent use of exclusive intellectual property rights. It makes it possible to treat intellectual property as one of the main factors of economic development.  Therefore, here is a general overview of the steps involved in securing each type of intellectual property. 

i.    Trademark Protection: A startup has to go through trademark availability search before registering their trademark. After the trademark search, if the trademark is available the startup can acquire the trademark by registering in the Department of Industries according to the Patent, Design and Trademark Act, 1965. Startups can protect their unique brand identity, including logos, names and taglines, through trademark. The trademark protection ensures the startup to be distinguishable in a market place. 

ii.    Copyright Protection: According to the Copyright Act, 2059, the protection of a copyright is not mandatory in Nepal. It is not necessary for a startup to file for a copyright protection. Copyright Protection is automatically obtained after the completion of the creation, and giving clear notice of copyright will serve as a notice. However, if the startup wants to secure their creative work, such as written content, software code, and artistic expressions, copyright will help protect the startup’s artistic creations. 

iii.    Patent Protection: Section 3 of the Patent, Design and Trademark Act, 1965 deals with the acquisition of the patent rights. If the startup wants to protect their inventions and innovative products, they need to acquire the patent rights. Hence, the protection of patents prevents competitors from producing or selling similar goods. 

iv.    Design Protection: If the startup desires to protect the visual appearance of new and distinctive products, design protection will ensure protecting their shape, pattern, configuration etc. Section 12 of the Patent, Design and Trademark Act, 1965 states the provisions for the acquisition of the title of the design.

v.    Trade Secret Protection: If the startup is willing to protect the confidential business information, the startup needs to protect their trade secrets. Trade secrets encompass proprietary information integral to the startup’s competitive advantage, such as company’s secret recipes, algorithms, or business strategies. 

Intellectual property is important for a startup, to safeguard their intellectual property assets and guarantee their long-term success. Intellectual Property assets can add significance to a startup’s overall valuation and include things like patents, design, trademarks and copyrights. 

In Nepal, before starting a startup, founders and startup owners can consult legal experts for the protection of their intellectual property rights. The Copyright Act, 2059 and the Patent, Design and Trademark Act, 1965 are the foundation for the protection of the Intellectual Property rights. The intellectual property rights of the startups should be protected to support the economic development of the country. The government has formulated a policy to help startup businesses in Nepal. The policy is called National Startup Enterprise Policy, 2080 which provides various supports for entrepreneurs and startup owners, such as seed money, human resource development, consultancy and technical assistance, and incentives for exports, including cash incentives. The policy further requires banks and financial institutions to provide loans at reduced interest rates to startups and invest a specified percentage of their lending into startups enterprises.

Thus, a special fund will be established to foster new and innovative ideas, with additional subsidies on loans offered to startups and innovative projects. The fund can be utilized to protect the intellectual property rights of the startup owners and their ideas. In this manner, it will help support for the protection of Intellectual Property rights for new businesses and startups in Nepal, which will help to foster the economic growth and development of the nation. 

Disclaimer 
We hereby inform all readers that the content of this article is for informational purposes only and should not be considered as legal advice.

For further information or legal consultation, please contact us at: info@apexlaw.com.np