Commercial Values & Intellectual Properties
June 8, 2011
Intellectual Property News
Commercial values in a business can include the intellectual properties such as patents, trademarks, and designs and also copyrights owned by that business. In many instances, a business has little or no commercial value without its intellectual properties.
The resources of the business, client and supplier lists, and profits should thus not only be the only factors taken into consideration when a person wants to calculate the commercial values of a business.
Putting a total on commercial values may be a bit more difficult. One for instance, cannot stop at the cost of patent or trademark registration, but must also consider the commercial value in terms of usefulness and marketability of for instance, a specific invention. License agreements and the income generated from such must be considered.
From the above information it can be seen that commercial values can be rather tricky especially if you want to get to a final figure because you want to insure or sell your business. The other end is also true. If you have to decide whether the seller’s price for a business is indeed worth it then you will have to consider commercial values such as domain names, business names registered and intellectual property such as trademarks as well.
The best advice is to get in expert guidance from experienced intellectual property attorneys to help you assess fair commercial values of the various intellectual properties owned by the business before getting to a selling price or purchasing offer total. For one, commercial value in terms of trademark rights is often exploited through franchising. When you thus want to sell a franchise the commercial values will be all the more important.
Smit & Van Wyk has an experienced team of intellectual property attorneys to assist with the setting up of license agreements, assignments, and registration of intellectual property rights, franchising and assessment of commercial values for the various intellectual properties.
Contact us for professional assistance today.
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The Impact of the Consumer Protection Act on Franchising in South Africa
February 19, 2011
Intellectual Property Information, Intellectual Property News
The legal principles of franchising have been long established in South Africa and are based on common law principles. However with the commencement of the Consumer Protection Act 68 of 2008 and specifically the commencement of the Consumer Protection Regulations in 2011, the franchising landscape is set to chance.
The Consumer Protection Act is aimed at protecting consumers, but will also affect the relationship between franchisees and their franchisors. According to the Franchise Regulations to the Act, there are very specific validity requirements to which franchise agreements should conform. The Consumer Protection Act also includes certain general principles, which the Franchise Agreements should incorporate. These principles are derived from the South African Constitution and include certain fundamental rights, which should be adhered to by the Franchise Agreement.
The reality is that most large franchises in South Africa are based on very old Franchise Agreements. The effect of the Consumer Protection Act will be to render certain of these agreements invalid.
It is therefore of utmost importance to revisit these Franchise Agreements to bring them in line with the provisions of the Consumer Protection Act.
Smit & Van Wyk specialises in Intellectual Property Law and has a department that deals with all aspects of Franchising and Franchise Agreements.
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Franchising
September 25, 2008
Franchises
One of the more common ways in which the commercial value of intellectual property is utilized is in franchising. Franchising is a method of doing business where a franchisor licenses trademarks as well as tried and proven methods of doing business to a franchisee in exchange for a recurring payment, and usually a percentage piece of gross sales or gross profits as well as the annual fees. In most cases the franchisor is a business that has proven commercial value (for example a chain store or fast food outlet). Various support services such as advertising and training are generally made available by the franchisor, and may indeed be required by him. This generally requires audited books, and may subject the franchisee or the outlet to periodic and surprise spot checks.
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