Ideas, by their definition, are intangible things and, likewise, business ideas can be little more than a concept. For example, 'a product that does this' or a simple thought such as 'sell these products or services to this consumer'.
As such, it can be very difficult to protect ideas like that for very long.
Say you’re just starting out and looking for investment and growth, you’ll need to disclose information about your business to all sorts of different parties. From friends and family to investors, potential staff and, of course, your customers.
And if you’re a bit more of a grown-up business and you have an exciting new idea to bring to market, it’s only a matter of time before your competitors will see this and either try and outdo you or, failing that, copy you entirely.
Unfortunately, there’s nothing you can do to stop someone from coming along, seeing what you do and trying to copy it. But there are a number of precautions you can take to help protect your business idea.
Over the course of this blog, we’ll clue you up as to what these precautions are, and what you can do if another outfit oversteps your bounds and begins infringing on your trade marks, rights or other intellectual property (IP).
Can you copyright a business idea?
In a word, no.
Copyright doesn’t protect ideas. Copyright protects authors of written, musical and other artistic works from having their work copied and essentially exploited by anyone other than the creator or creators themselves (in theory).
Other forms of IP protection – such as patents, trade marks and design rights – great business tools though they are, also fall a little short of being able to protect ideas before they’ve been realised.
Patents protect an inventor’s right to their inventions, but not their ideas. They can be applied to items such as manufacturing equipment or processes, technological code or products. To qualify for patent protection, the item or process must be a genuine innovation and kept secret.
Unlike copyright or patents, which are concerned with protecting the end product. Trade marks protect your trading related IP. So, these can cover your ideas behind your logo, your brand or your slogan and prevent these (or similar) from being used by other companies, causing confusion and potential damage to your business’s reputation.
Finally, design rights protect the aesthetic features of a product, such as its shape, packaging or decoration. While a basic level of design right is granted automatically to the designer, you can also register different types of design with the Intellectual Property Office (IPO) to protect them more securely.
For more information about these forms of IP protection, see our introductory guide to IP.
What can you do if someone copies your business idea?
While it’s very difficult to prevent someone from copying your business idea, there are some red lines that cannot be crossed.
And, depending on what protections you have in place, there are tools at your disposal to turn the tables on would-be imposters.
If you have proof of ownership of a copyright, patent or a trade mark and you can prove that infringement has taken place, you may:
- Send a cease and desist letter: This is a note threatening legal action against another party unless they stop the infringing activity. Unfortunately, where the infringing party is hard to find, unresponsive or based outside of the UK, such letters may not be very effective.
N.B. where you're alleging infringement, be aware that there may be a risk of a counterclaim against you if your claims aren’t legitimate.
- Send take-down notices/requests of third-party hosts infringing content: This may be appropriate where copyright or trade marks have been infringed. Take down notices are sent to the internet service provider (ISP) that is hosting the offending material. They inform the ISP of the infringing activity and asks them to remove any offending material. Many ISPs provide an online form you can fill out to notify them of infringing content.
- Enlist the help of a mediator: Mediation is a way of solving disputes with the help of an independent party to reach a mutually agreeable solution. Of course, the infringing party also needs to be engaged in any mediation session, so it’s not always a viable option. See our guide to mediation for more information.
- Take legal action: Before taking any steps along this path, we strongly recommend seeking expert legal advice. Court proceedings are both costly and time consuming but, if successful, may provide you with compensation, force the infringer to hand over or destroy any infringing materials and prevent any further use of your IP by them.
Of course, often the best cure if IP infringement is simply prevention.
By taking steps to keep your confidential information and IP safe, you can at least make it difficult for unscrupulous competitors to get their hands on your ideas or other confidential information.
- Be select about what you share and who you share it with: If you need to share information about your business with people outside of your organisation (such as investors or potential clients) be sure not to reveal any more than you have to.
- Make use non-disclosure agreements (NDAs), particularly with external parties, to make it clear that information must not be shared openly.
- Include confidentiality terms and restrictive covenants in your employment contracts to brief employees on what they can’t do during and after their term of employment with you.
- Have a clear and accessible data asset management policy that informs staff how they must handle sensitive information, where it can be stored safely and where the potential risks are.
- Keep meticulous records: Make sure you’re keeping track of what information you’re sending and to whom. Is it password protected? Can you revoke access? Similarly, if you’re creating IP that may form part of a trademark, copyright, patent or design right – keep a written record of that process. This might help in the event of a dispute at a later date, or when registering with the IPO or other authorities.
For more information, see our guide to keeping your confidential info and IP safe.
What is a 'copycat competitor' and what can you do about them?
Copycat competitors are other businesses who try to ape some of your business’s strategies, stylings or other characteristics in order to emulate some of your success.
Of course, competition is only natural in business. Even more so if you’re doing something well and it shows. Unfortunately, some people are more unscrupulous than others and won’t just stop at copying what you do and how you do it but will try to look and sound like you while they’re doing it too.
This sort of behaviour can cause confusion for your customers, loss of sales and damage your good reputation and genuine anguish to business owners who see the fruits of their hard work stolen.
While there is protection available from the law of ‘passing off’, it’s not nearly as effective as the more robust forms of IP protection we discussed earlier.
This is particularly true for SMEs because, in order to successfully take action against a copycat rival using the law of passing off, you must be able to show that:
- your standing in the market is of a high enough level that members of the public would assume that the copycat competitor was you; and
- that the actions of the copycat, in mimicking your business, has genuinely caused you a loss of business or other damage, for example, to your reputation.
So, while the law is there to protect you, it’s far simpler – not to mention, more reliable and cost-effective – to register to protect your IP and rely on those rights.
Take the steps we’ve outlined in this blog and do everything you can to make sure your customers know that the copycat business and yours have no business relationship.
Most importantly, if copycat businesses do emerge, don’t let them get you flustered. For one thing, you must be doing something right if people want to copy you; as they say, imitation is the highest form of flattery.
For another, they'll always be following where you are leading. If you’ve built your business up using your passion, talents, original ideas and, of course, hard work you’ll be in a much stronger position to adapt and grow with your market and customers than the copycats ever will be.