Registering a patent in SA takes patience
May 15, 2008
By Stephen Timm
Yet South Africa, although credited with inventions such as the CAT scanner, Kreepy Krauly and Dollosse, still has a low level of innovation.
The country's rate of registering patents - long held as the measure of a country's level of innovation - remains low, while entrepreneurs complain that the patenting process remains complex and costly.
Registering a patent locally can cost R8 000 to R30 000.
A report entitled the State of Patenting in South Africa, released last year, revealed that there had been no marked increase in the number of patents filed at the Companies and Intellectual Property Registration Office (Cipro) in the past 10 years.
The report's author, McLean Sibanda, a senior patent attorney for the Innovation Fund, said more than half of all patents held in South Africa emanated from abroad, with big businesses such as De Beers and Sasol, rather than entrepreneurs, accounting for most of the patents registered locally by South Africans.
Last year the Innovation Fund launched a patent support fund aimed at technology entrepreneurs. A similar one was launched in 2004, aimed at small businesses.
Both funds are targeted at financing the patent process for entrepreneurs.
Yet the uptake has been poor, with only seven firms and entrepreneurs having been assisted by the funds. Sibanda admitted that the funds needed to be better marketed.
However an encouraging sign is the recent introduction of tax incentives to encourage investment of venture capital and research and development.
But Pieter Dreyer of industrial design consultancy KM Product Design said innovative products were not automatic money spinners.
Dreyer said a new product often proved more costly than an established one, because it would require an entrepreneur to spend more educating the market about it.
Some products were not patentable, simply because they had been around for such a long time, he said. A patent expires after 20 years.
For some entrepreneurs, adapting foreign innovations to South African conditions may seem profitable, particularly in developing affordable alternatives to a product.
But Sibanda said entrepreneurs who adopted foreign products would most likely not be able to export them to other countries, where they would have patent protection.
He advised entrepreneurs who modified or adapted foreign products to rather register them as patents.
Wessel van Wyk, a patent attorney for Smit and Van Wyk, said an entrepreneur could choose one of two routes, depending on the amount he or she planned to invest in a product that had been adapted without patenting.
The first was to run an infringement search at Cipro, to determine whether someone else had taken out a patent on a product similar to the one under investigation.
This could be costly and time consuming, as a search had to be conducted in Pretoria by hand because the documents were not stored electronically.
The second route was to go ahead with producing the adapted product, but to cease production and destroy the remainder of the product should notice be given that the supplier was infringing upon a patent.
Alan Dunlop, a patent attorney at Hahn and Hahn, said the second option was risky, as the patent holder could sue for damages, which could run up to R1 million.
Hahn and Hahn have an electronic database of all scanned patent registrations, assembled in 1978. Dunlop said a patent filing cost between R1 000 and R2 000.
Andy Brown, who owns a small technology company called Tenacent, decided four years ago to begin patenting a security tag for shipping containers that could be read by radio frequencies, after finding nothing similar to this device on the market.
Brown is still in the process of lobbying shipping associations and parastatals.
He said that so far he had spent more than R620 000 patenting the tag locally, as well as in 15 countries. He expected to spend about R1 million on patenting alone.
"There are hidden fees that rear their head that you hadn't budgeted for," he said.
In 2006, Brown received R750 000 to finance the process through the Innovation Fund's patent support fund.
But he said the process of applying for the finance, in which the fund took 20 percent in his company, was "cumbersome". It took him nine months before he could access the funding.
Inventor Xolani Mtshizana, who recently began patenting ProLox - a net-like device that helps to separate hair in the process of weaving dreadlocks - described the process of patenting his innovation as "very difficult". He stumbled on the product idea when he saw his child playing with a tennis racket in his hair.
The banks he approached for finance turned him down, but Mtshizana has since concluded a partnership agreement with the Firehouse, a multimedia company that will assist him in marketing and financing the patenting of his new product.
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