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I have a patent – am I free to operate?

Freedom to operate

Patent Protection

A patent is a temporary monopoly of a maximum of 20 years. The monopoly is granted by the government of a country to the owner of the patent. In return, the owner of the patent has the duty to disclose the invention to the public in a way that a person who is skilled in the technical field can make the invention. This is also referred to as “enabling disclosure”.

The patent provides the patent owner with the right to exclude others from exploiting the invention. As a result, the patent owner can stop others from making, selling, importing, exporting or even offering to sell the invention in the country where the patent is granted. Once the monopoly ends, the invention becomes public property and may be freely used by anyone.

In short:

  • Legal right to exclude others from exploiting your invention
  • Commercial tool to create a competitive advantage, possible passive income stream
  • Valuable business asset

Freedom to Operate

Because a patent provides the right to exclude others from exploiting an invention, you may also be excluded from exploiting the invention of others. In other words, there is a risk that you may infringe someone else’s patent.

A freedom to operate (FTO) analysis helps you to minimise the risk of this. An FTO analysis provides you with an opinion whether you can exploit a product or service with a minimal risk of infringing patent rights of others.

In short:

  • Assessment of risk to infringe patents of others
  • Potential cost savings, such as unnecessary R&D costs, reputational damage and legal costs
  • Analysis of competitor’s activities

Illustrative example*

Karl Benz invents a motorcar with an internal combustion engine. A patent for the engine is granted. Shortly after, Rudolf Diesel invents a motorcar with a diesel engine and a patent is granted.

Both Mr Benz and Mr Diesel were successful in protecting their ideas with a patent.

Mr Benz is free to sell motorcars with an internal combustion engine, as long as the engine is not a diesel engine. On the other hand, Mr Diesel cannot exploit his invention due to Mr Benz’s patent. He is not free to operate, unless he obtains a licence from Mr Benz.

*example for illustration purposes only and may not reflect actual events