These days, most businesses are built around the commercialisation of intellectual properties (“IPs”). Startups offering Software-as-a-Service, business consultants offering corporate trainings, game developers releasing their newly developed games, the list goes on. Just like technology, IPs have become so intrinsically intertwined with business offerings that their protection can no longer be ignored by companies.
That being said, one common struggle that we often see with companies and businesses is the lack of understanding on how best to protect their IPs. Most have the misunderstanding that trademark is the best, or perhaps even the only, way to protect the IPs of the company, not knowing that trademark is only one aspect of the IPs of the company.
With this article, we hope that there will be increased understanding of the various types of IP protections available, and which is or are the most suitable or relevant for the company based on the nature of business offerings.
1. Patent
For companies with inventions that provide technical solutions to existing problems, they can consider securing patent protection for the inventions. The definition of “invention” is very broad under the Malaysia Patents Act 1983. Any solution that is new, involves an inventive step, which is capable of industrial application, can qualify as an “invention” for the purpose of securing patent protection. An invention does not have to be earth-shattering or revolutionary. It can be a solution that involves a tweak or adjustment to existing technology which enhances the technology as a whole. For example, a cloud-based access control system is a patentable invention at the time where access control system was only implemented on-premise; a parking management system with licence plate recognition technology is a patentable invention at the time where parking management system relies solely on ticketing.
To secure patent protection in respect of an invention, however, companies need to file a patent application in respect of the invention at hand prior to the commercialisation or disclosure of the invention to the public. This is because once an invention has been disclosed to the public, it loses its novelty and can no longer fulfil the patentability requirement under patent law. We have encountered several clients with promising inventions, but had difficulty securing patent protection in respect of their inventions because they had started commercialising the inventions ahead of securing IP protection.
2. Copyright
Copyright is the “best friend” of software companies. Copyright essentially refers to the rights to control the reproduction and communication to the public of original work that has been reduced to material form. For illustration, it covers the right of an author to control the photocopying of a novel written and published by him, or the right of a photographer to control the printing of an image on t-shirts. At the risk of oversimplification, it can be said that copyright extends to anything that is reduced to a material form as long as it is original – this includes the source code of software, since they are essentially words. In other words, software companies can rely on copyright to prevent the source code of their software from being copied. While it is also possible to secure patent protection in respect of the functionality of a software where it fulfils patentability requirements, copyright protection exists automatically by default upon reduction to material form, making it far easier to attain than patent. Additionally, copyright also offers a longer duration of protection than patent, allowing software companies to continue to protect their source code even after the patent for the software has lapsed.
Since registration is not a prerequisite for copyright protection, software startups that are cash-strapped frequently rely on it to protect their software offerings.
3. Industrial Design
Companies that want to prevent the design of their products from being copied can rely on industrial design protection to do so. In the case of industrial design, it is relevant to companies that have physical products, especially where these products have unique designs which may be prone to copying. Think of the design of a perfume bottle, steam iron, car, watch – they are all capable of being protected as industrial designs. Similar to patent, industrial design protection requires a particular design to be registered before protection can be granted, and is subject to the design concerned being new.
For companies, they can even consider a 2-fold protection via industrial design and copyright simultaneously. In addition to seeking registration of industrial design, the drawings of the design of the products are also eligible for copyright protection.
4. Trademark
As mentioned at the beginning of this article, trademark is the IP that is the most widely known. Unlike patent, industrial design and copyright, which offer protection in respect of the products or offerings that are being commercialised, trademark protects the brand or the name of the product or business – what we normally refer to as the identification of the source of a particular product or offering.
Trademark is a little unique in that it can be protected through registration, granting trademark owner statutory protection against copying, or it can also be protected through usage of a trademark in commercial trade, which will grant the owner common law protection. Having trademark protection alone is not sufficient for companies and businesses because it only helps prevent competitors from copying the brands or the names, the trade identifiers of the companies and businesses. It does not allow software companies from preventing the copying of the source code of their software, nor does it prevent the copying of the design of a trendy pair of shoes.
5. Trade Secret
Trade secret is also one way for companies and businesses to protect their valuable IPs. This is however more suitable for IPs that are not meant to be disclosed to the public, such as the recipes of food and beverages. To maintain the value of trade secrets, the owners have to do just that – maintaining the secrecy of the trade information. Unlike the other IPs that we have discussed in this article which may require some form of disclosure to qualify for protection (e.g., submission of the patent specification to the intellectual property offices), trade secrets are protected through the control of their usage and communication.
Companies seeking to retain their trade information secret will have to ensure that confidentiality obligations are imposed on every single person that have access to the trade information, typically their employees. On top of that, recognising that breach of confidentiality may be difficult to detect, some companies even deliberately avoid letting any employees from having access to the whole piece of a particular trade information – sensitive and confidential trade information is broken up into several pieces, where employees are only given one part of the trade information and never the full piece. For example, a beverage manufacturer may dissect the recipe of its signature drink into a few parts, where the employees’ workflow is controlled in such a way that not a single employee has access to the whole recipe, thereby controlling the number of people who have knowledge of the full recipe.
Conclusion
IPs are getting increasingly important to companies and businesses. Many startups mainly derive their valuation based on their IPs, making IPs the crown jewel of the companies. If not adequately protected, companies may risk valuation drop or worse, losing their competitive edge to competitors who somehow managed to get their hands on the IPs of the companies. In some countries, collateralising of IPs are even being explored, making IPs one of the ways for companies to access financing from financial institutions.
To maximise IP protection, companies and businesses should have a clear idea of what type of IP protection is or are relevant to the products or services being offered. If necessary, consider conducting IP gap analysis to ascertain the adequacy of the companies’ existing IP protection and whether there is any gap that should be closed. If in doubt, speak to lawyers who specialise in technology or intellectual property laws, who will certainly be able to assist.
The Technology Practice Group of Halim Hong & Quek continues to be recognised by leading legal directories and industry benchmarks. Recent accolades include FinTech Law Firm of the Year at the ALB Malaysia Law Awards (2024 and 2025), Law Firm of the Year for Technology, Media and Telecommunications by the In-House Community, FinTech Law Firm of the Year by the Asia Business Law Journal, a Band 2 ranking for FinTech by Chambers and Partners, and a Tier 3 ranking by Legal 500.
If you have any questions on intellectual property protection, please feel free to reach out to the partners at the Technology Practice Group for consultation.
About the authors
Lo Khai Yi
Partner
Co-Head of Technology Practice Group
Technology, Media & Telecommunications (“TMT”), Technology
Acquisition and Outsourcing, Telecommunication Licensing and
Acquisition, Cybersecurity
ky.lo@hhq.com.my.
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Ong Johnson
Partner
Head of Technology Practice Group
Fintech, Data Protection,
Technology, Media & Telecommunications (“TMT”),
IP and Competition Law
johnson.ong@hhq.com.my
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