Implementing the new IP principles - Bridging the gap by 1 July

Key Point:
The 1 July 2008 deadline for compliance with the IP Principles for Australian Government Agencies is looming. In this article, we suggest how agencies can "bridge the gap" to having compliant IP management practices.

The IP Principles for Australian Government Agencies are 15 principles which, in essence, require Financial Management and Accountability Act 1997 agencies to introduce policies and practices to manage their intellectual property like the valuable asset that it is.

These agencies are required to develop IP management policies by 1 July 2008. (Agencies covered by the Commonwealth Authorities and Companies Act 1997 are encouraged to consider the policy as an expression of good practice in the management of IP.)

Some actions that you can take to bridge the gap between past practice and the new policy by 1 July 2008 are set out below.

Plan for implementation of the policy

All agencies should consider producing an IP policy implementation plan to implement and monitor their compliance. Some of the questions that the plan should answer include:

• How will you identify your IP?
• How will you manage your IP - through a central function or on a decentralised or devolved basis (that is, with each division or business area responsible for its own IP practices and policies with some limited "central" oversight or reporting)?
• Which role or area within your organisation will be accountable for compliance with the IP Principles?
• Is commercialisation of IP relevant to your agency- if so, have you established commercialisation procedures?
• Do you recognise employees who develop IP for you? How will you protect IP that is developed for you by contractors?
• What are the risks that arise in the context of your agency's business that are related to IP? For example, are you using contractors for a range of projects that create IP?
• How will you monitor compliance and keep your IP policy implementation plan up to date and relevant to your agency's business over time?
• Who are the stakeholders within your agency who will need to be engaged to ensure appropriate resources and support are available?

It is vital that the senior executive are engaged, and that defined corporate (human and financial) resources have been set aside for implementation and management. When the ANAO audited IP policies and practices across agencies in 2004, it found that "leadership and corporate support are critical" to the effective implementation of IP policies and plans, as well as the ongoing management of IP.

Identify, audit, value and register your IP

It is generally accepted that compliant implementation of the IP principles will require agencies to update, or develop and populate, an IP register. Maintaining an accurate and up to date IP register will be essential to effective, ongoing IP management. IP registers should be updated as a "business as usual" task whenever the agency deals with IP. For more significant updates, IP reviews or audits can be conducted to:

• search for, identify and record IP that has been acquired, "improved" or developed or created by the agency during a specified period (for example, the period since the last review)
• identify the nature and extent of rights which an agency has in relation to each item of IP (for example, ownership or licence)
• identify IP in relation to which the agency may no longer have rights (for example, because it has assigned those rights) so that the relevant IP can be removed from the register.

Methods of conducting an IP review or audit include:

• conducting an IP survey
• reviewing trademarks or patents that may have been taken out
• reviewing agreements that an agency has in place under which IP may have been created, licenced or assigned.

As with other assets, the value of IP should be known and recorded. In some cases (for example, licence agreements with limited additional services) the value of the contract will indicate the value of the IP. In many cases, however, the assistance of a specialist will be needed to ensure that the value of IP is correctly recorded. As part of its valuation of IP, an agency should also identify the strategic significance of each item of IP to the agency's business (for example, whether that IP is critical, significant or not significant). Understanding the strategic value of IP will enable proper valuation and risk treatment.

Protect your IP

Agencies are used to protecting their valuable physical property through physical security, including barcodes, surveillance, engraving and other measures. IP, which is an intangible asset, should also be protected, which will usually involve monitoring use of that IP and policing infringement. An IP policy implementation plan should address how agencies will protect their IP. In some cases, technological protection measures may also be engaged to assist.

Train your staff

Effective management of IP within an agency requires an understanding of what IP is, and the types of risks that it can raise for an agency's successful delivery of its business. Training for key agency personnel is essential to enable them to recognise IP and the policies that regulate it.

Why buy when you can share?

In many projects involving the acquisition of IP (particularly where licence volumes are a consideration) there is scope for an agency to get a better deal by teaming up with another agency seeking to procure the same type of licences, or at least to "lock in" key terms and price for the benefit of other agencies. As part of implementation of the IP policy, agencies should consider requiring officers to consult with other agencies when planning a procurement that involves the acquisition of IP as one of the key items of value.

Agencies should bear in mind that cooperative procurement is a policy focus for the Australian Government, as discussed in the Department of Finance and Deregulation's Good Procurement Practice booklet GPP 03 - Cooperative Agency Procurement, published in December 2007.

Looking past 1 July

Once you have taken the steps outlined above you are on your way to implementation of the IP Principles. Compliance with the IP Principles is not, however, a one-off exercise. You will need to keep monitoring and reviewing your policies and checking that your new approach to IP management is working. For example, you should consider regular IP reviews and reporting to the executive as part of your agency's routine assurance practices.