“Ideas in your mind have no patent value.

They must be expressed or reduced to practice

before it is too late"
~Kalyan C. Kankanala, Fun IP, Fundamentals of Intellectual Property

Before a business could start is operation it must secure the necessary documents for
legality. There various requirements the startup venture must comply with in order to avoid
legal issues later. In addition, the new business should figure out the intellectual properties
(IP) it needs. The venture ought to ensure to do it exactly right. Doing its IP right at the start
will end up costing less, gives financial security and it could spark interest in investors.

Legal Considerations

With a flourishing economy, the Philippines offers great opportunities for investments and
business development. The positive growth rates, along with the massive pool of skilled
workers, lower overhead cost, business-friendly policies, and other essential resources,
have fueled the investment interest here and abroad and have led to the establishment of
various businesses in the country. Here are the various sizes of an enterprise in the
Philippines:

Some key benefits of doing business in Philippines are:

1. Domestic and regional market opportunities - The local market provides numerous
business opportunities with its consumer-driven population 100 million. It can also serve as a
profitable position for further business expansion.

2. Favorable economic conditions Many incentives have been launched and implemented by
the Philippine government since early 90s. This provided rewarding business climate for
both local and foreign business investors.

3. Comfort of travel - The places in the Philippines are well- connected. Filipino people are
eager, capable, and glad to assist anyone in moving from one place to another.

4. Business conducted in English - English is the chief language used to conduct business
worldwide. This is a major advantage for anyone who comes from a country where the
inherent language is English.

Besides being a place for leisure, the Philippines over the years has turn to be a good place
to start a business. The Philippine government has made it simpler all the processes for all
kinds of businesses to raise the spirits of investors and entrepreneurs. Here are some of the
regulations in setting up a business or starting a company:

Choose a Business Structure

Any business requires to obtain the necessary licenses and certificate of registration before
it can be completely operational. The requirements differ fie every business structure. In the
Philippines the choice if a business structure depends on the size and resources of a
business, which could be a:
1. Sole proprietorship This is the simplest form of business entity where one person is
responsible for all a company's profits and debts. Proprietorship costs depends on which
market a business is part of. Largely, early expenses include government fees, taxes,
equipment needs, office space, banking fees, and any professional services a business
chooses to contract. Here are some of the advantages of this business structure:

a. Easy setup - A sole proprietorship is the simplest legal structure to create. There is very
little paperwork to accomplish with no partners or executive boards to answer to.

b. Low cost - The only fees related with a proprietorship are license fees and business taxes.

c. Tax deduction-Since the business is a single entity, the owner may be eligible for certain
business tax deductions, like a health insurance deduction.

d. Easy exit-Creating the proprietorship is easy and so is going out. The owner can close the
business at any time with no official paperwork needed.

2. Partnership-This entity is owned by two or more individuals.

There are two types:

a. a general partnership, where all is shared in the same way; and

b. a limited partnership, where only one partner has control of its operation while the other
person (or persons) contributes to and receives part of the profits.

Partnerships carry a double status as a sole proprietorship or limited liability partnership

(LLP), based on the entity's funding and liability structure. A limited liability company (LLC) is
a hybrid structure that permits owners, partners or shareholders to place boundary on their
personal liabilities while enjoying the tax and flexibility welfares of a partnership. Under an
LLC, members are protected from personal liability for the debts of the business if it cannot
be established that they represented in an unlawful, immoral or unreliable manner in
executing the activities of the business.

Here are some of the advantages of this business structure:

a. Easy to form-Like a sole proprietorship, there is slight paperwork to file. It an Articles of

Partnership agreement to be formed and submitted for a fee. A business license is typically
required as well.

b. Growth potential - The banks can consider two credit lines rather than one, which can be
useful to have a not-so-smart credit score.

c. Special taxation Both partners report their common income or loss on their individual
income tax return. Each owner brings a certain level of experience and working capital to the
business, which can have impact on each partner's share of the business and their
contribution.
3. Corporation The law considers a corporation as an entity separate from its owners. It has
its identifiable legal rights, independent of its owners, hence it can sue, be sued, own and
sell property, and sell the rights of ownership in the form of stocks. There are several types
of corporations, including:

a. C corporations It is owned by shareholders and are taxed as separate entities. JP. Morgan
Chase & Co. is a multinational investment bank and financial services holding company
that's listed as a C corporation. Since C corporations permit an unrestricted number of
investors, many bigger companies, such as Apple Inc., Bank of America, and Amazon, file
for this tax status.

b. S corporations - They are designed for small businesses and escape double taxation,
much like partnerships or LLCs. The corporation can choose not to distribute the company's
proceeds, in favor of putting the money back into the business. The S Corporation taxation,
the shareholders will still be taxed on their portion of the profits based on the percentage of
ownership.

c. B corporations - Also known as benefit corporations, they are for-profit entities structured
to make a positive impact on society. The Body Shop has established its continuing
commitment to backing-up environmental and social movements, causing in an awarded B
corporation status. The Body Shop uses this status for permanent change on issues like
human trafficking, domestic violence, climate change, deforestation and animal testing in the
cosmetic industry.

d. Closed corporations - Typically run by a few shareholders, they are not publicly traded and
benefit from limited liability protection. Closed corporations, known also as privately held
companies, have more flexibility compared to publicly traded companies. A family
corporation is an example where the stocks are not publicly traded but allocated to family
members.

e. Open corporations - They are available for trade on a public market. Many well-known
companies, such as Microsoft and Ford Motors, are open corporations. Each corporation
has taken ownership of the company and consents anyone to invest.

f. Nonprofit corporations - They exist to help others in some way and are rewarded by tax
exemption. An example of a nonprofit is the Philippine Red Cross. This types of business
structure has one sole purpose which is focusing on something other than turning a profit.

Here are some of the advantages of this business structure:

a. Limited liability - Stockholders are not personally liable for claims against the corporation.
They are only liable for their personal investments.

b. Continuity - Corporations are not affected by death or the transferring of shares by its
owners. The business continues to operate open-endedly, which is preferred by investors,
creditors and consumers.
c. Capital It is much easier to raise big amounts of capital from multiple investors when the
business is incorporated.

4. Cooperatives - The business must register with the Cooperative Development Authority
(CDA). Cooperatives may be eligible for government grants that help them get started.
Cooperatives can leverage their business size, thus obtaining discounts on products and
services for their members.

Business Registration

As mentioned earlier, before any local and foreign companies are permitted to do business
in the Philippines. These businesses are required to register with several government
agencies and get business permits from the local government unit where they prefer their
business to be situated. Here the ways to register the different business structure:

Single Proprietorship

The business should apply for a business name and get registered with the Department of
Trade and Industry (DTI).

1. A copy of government issued ID

2. A duplicate proposed business name registration form
3. Payment of registration fees fixed on territorial based with documentary stamp tax
4. Complete employee data form
5. Copy of Municipality permission letter
6. Community tax certificate
7. Location and Barangay clearance
8. Fire safety and electrical inspection certificate
9. Occupancy certificate and building permit
10. Contract of lease, if any

Partnerships or Corporations

The specific list of SEC registration requirements differs based on the type of business entity
to register in addition to the nature of activities and type of enterprise to undertake. But it is a
general requirement to undergo the following processes to obtain a Certificate of
Registration from SEC:

1. Secure a unique business name (a business name can be reserved through SEC's online
services portal - the SEC i-View [[Link] [Link]])

2. Accomplish an Application Form from SEC

3. Draft the necessary documents required and have these notarized for the specific
business entity you plan to register, which are as follows:

a. Articles of Incorporation and By-laws

b. Treasurer's Affidavit
4. Deposit the minimum paid-up capital requirement

5. Obtain necessary licenses or permits from appropriate government agencies (for

regulated industry sectors and business activities)

Homeowner's Clearance/Barangay Clearance

A homeowner's clearance is obligatory if the business will function within the village or
subdivision.

The business must obtain a barangay clearance and get a community tax certificate (CTC).
The clearance must be taken from the Barangay hall where the business is located. The fee
for Barangay Clearance ranges between PHP 300- PHP 1,000.

Business License/Mayor's Permit

Before anyone can start operating a business in the Philippines, the owner needs to secure
a Mayor's Permit or Business Permit from the Local Government Unit (LGU) where the
company office is located. LGUs can be cities or municipalities and the procedures
mpaptaining a permit may differ based on the local regulations and ordinances the city or
municipality seeks to implement. The annual basic and additional community tax can be paid
at the City Treasurer's Office (CTO). The basie tax would depend on the business activity. It
must not be higher than PHP 500, Apart from this, there are a few companies who need to
secure other clearances or certificates such as a location clearance, fire safety and
inspection certificate, mechanical permit, certificate of electrical inspection, and sanitary
permit. Here is the list of requirements for getting a Mayor's Permit in the Philippines:

1. Application Form
2. Certificate of Registration from Securities and Exchange Commission (SEC) for
Corporations/Partnerships; Department of Trade and Industry (DTI) for Sole Proprietorships;
or Cooperative Development Authority (CDA) for Cooperatives
3. Barangay Business Clearance
4. Community Tax Certificate (CTC or Cedula)
5. Contract of Lease (if leased)/Transfer Certificate of Title (if owned)
6. Sketch/Pictures of the business location (3 copies)
7. Public Liability Insurance (for Restaurants, Cinemas, Malls, etc./exempted: Sari-sari
Stores, Carinderias)
8. Locational/Zoning Clearance
9. Certificate of Occupancy (Building and Unit)
10. Building Permit and Electrical Inspection Certificate
11. Sanitary Permit
12. Fire Safety Inspection Permit

Business Tax Payer Identification Number (TIN)

A business tax payer identification number (TIN) from the Bureau of Internal Revenue (BIR)
must be obtained along with an SSS number (for the business and employees). Now that
you have registered [Link] with the SEC, you must now complete the following
process:

1. Company name verification slip

2. Articles of incorporation (notarized) and by-laws
3. Treasurer's affidavit (notarized)
4. Statement of assets and liabilities
5. Registration data sheet with particulars on directors, officers, stockholders, and so forth
6. Written undertaking to comply with SEC reporting requirements (notarized)
7. Written undertaking to change corporate name (notarized).

The Certificate of Registration issued by BIR (BIR Form 2303) contains an enumeration of
the types of taxes that are required to be paid to the government. which includes the
following:

1. Corporate income tax

2. Value-added tax
3. Withholding taxes (on compensation, fringe benefits, etc.)

Registering a business with the BIR gives the authority to print the official receipts and
invoices, formally register the Tax Identification Number (TIN) provided for the company in
the Certificate of Registration issued by SEC, and register the books of accounts required to
annually register with BIR to serve as official record of the business transactions for the
fiscal year. Register the company with the Bureau of Internal Revenue (BIR) District office for
authority to print invoice and book of journal. This task is vital in deciding for applicable
taxes, paying the annual registration fee, and acquiring and stamping of sales invoices,
receipts, and books of accounts.

1. Apply for Sales Invoices/Official Receipts through BIR Form 1906 Authority to Print
Receipts and Invoices. The documentary requirements for obtaining such are as follows:

a. BIR Form 1906 (Authority to Print)

b. BIR Certificate of Registration (Form 2303)
c. Final and clear sample of Principal and Supplementary Commercial Receipts and Invoices
d. BIR Certificate of Registration of Accredited Printer
e. BIR Annual Registration Fee (Form 0605) of Accredited Printer
f. Job order
g. Quarterly report of Accredited Printer

2. Register books of accounts and have them stamped by the RDO where the business is
registered. Note that the BIR examiner will usually advise the owner the types of books and
taxes applicable to a business upon the initial taxpayer's briefing. The documentary
requirements have to be submitted upon registering the books of accounts are the following:

a. BIR Certificate of Registration (Form 2303)

b. New sets of books of accounts, such as but not limited to:
c. General Journal
d. General Ledger
e. Cash Receipt
f. Cash Disbursement
g. Subsidiary Sales Journal
h. Subsidiary Purchase Journal

3. Attend the taxpayer's initial briefing to be conducted by the RDO for new registrants to
inform them of their rights and duties/responsibilities

Other Requirements

Any new venture must also apply for registration in other government entities. The business
should also register with the following:

Bureau of Internal Revenue (BIR)

The Bureau of Internal Revenue (BIR) is the taxing authority in the Philippines in authority for
regulating taxation and collecting internal revenue taxes. It requires resident citizens in the
Philippines who are receiving income from sources within or outside the country to pay their
personal income taxes and file income tax returns.

For new employees without a Tax Identification Number (TIN)

1. The owner needs to require the employee to file BIR Form 1902 to the Revenue District
Office (RDO) where the company is registered.

For new employees with existing TIN

1. If the employee already has an existing TIN from his previous employer and it is
registered with the same RDO as the company, either the employee or HR personnel needs
to submit a BIR Form 2305 to update his information.

2. If the obtained his TIN from their previous employer employee and it is registered in a
different RDO as the company, the employee needs to submit a BIR Form 1905 in the RDO
where his previous employer is registered.

3. The updated BIR Personal Income Tax Table under TRAIN Law can be viewed here.

PhilHealth

Source: [Link]

Under Republic Act No. 7875, all employees, both public and private are instructed to apply
for membership and pay monthly contributions to the medical insurance company in the
Philippines, also known asthe Philippine Health Insurance Corporation (PHIC). This
government agency is more commonly known as PhilHealth.
PhilHealth makes available health and hospitalization subsidies to its members should they
or their dependent/s be hospitalized. It gives employees with a practical means of paying for
sufficient medical care in the Philippines. The monthly contributions are subtracted from the
employee's actual monthly salary where they are obligatory to contribute 50% of the amount
and the remaining 50% should be paid by by the employer.

1. For employees - Each new employee needs to fill-up and sign a PhilHealth Member
Registration Form (PMRF) regardless if he/she is already a PhilHealth member or not.
Existing members are required to submit their PhilHealth ID number. An accomplished
PMRF form should be submitted to the PhilHealth office where your business is registered.

2. For employers - Employers are required to submit a PhilHealth Form ER2. This form
should have the list of new employees and be submitted to the PhilHealth office where the
company is registered.

Home Development Mutual Fund (Pag-IBIG Fund)

Republic Act 7835 orders employers to contribute to the Home Development Mutual Fund
(HDMF). This is otherwise known as the Pag-IBIG Fund. It is a provident savings system
that provides housing loans to public and private employees, and also to self-employed
persons who apply for membership. It offers housing and land purchase loans to its
members with the lowest interest rate and are payable for up to thirty (30) years.

1. For employees - New employees are mandated to undertake the HDMF Online
Membership Registration to become members of the Pag-IBIG Fund. Employees must be
registered with the SSS first before they can register with the Pag-IBIG Fund.

2. For employers - Employers can submit the list of their new employees by filling up the
Member's Contribution Remittance Form (MCRF). Employers need to mark the new
employees as NH (Newly Hire) when manually filling the monthly Pag-IBIG Fund
contributions or accomplishing it online through the Fund's online web portal.

The updated Pag-IBIG Fund monthly contribution table can be viewed here.

Social Security System (SSS)

Given under Republic Act No. 8282, all employees employed by private companies are
obligatory to apply for membership with the Social Security System (SSS). This system
offers private employees and their families security against disability, sickness, old age,
death or other such cases that could make them unable of continuing their employment. The
Government Service Insurance System (GSIS) is its equivalent system for public employees
in the Philippines.

Both employer and employee are compulsory to send monthly contributions to SSS. The
contribution amount is based on the employee's actual monthly salary wherein the employer
is mandatory to subsidize 70% of the required amount while the remaining 30% is taken
from the employee's monthly salary.
1. For new employees without SSS number-Employers must require a new employee to
register in the SSS office where the company is registered and the employee must provide
his number to the employer after the SSS number is allotted to them

2. For new employees with existing SSS number-Those who are already members of the
SSS must submit their current number to their employers

Employers need to fill-up the SSS Form R1A which contains the list of new employees
together with their respective SSS numbers. The SSS Form R1A can be surrendered online
or to the SSS office where the company is registered.

Businesses with any number of employees must register to the Philippines Social Security
System. The following documents should be submitted:

1. Employer registration form (Form R-1)

2. Employment report (Form R-1A)

3. List of employees, specifying their birth dates, positions, monthly salary and date of
employment; and

4. Articles of incorporation, by-laws, and SEC registration.

Legal Mistakes made by Startups

When beginning a new startup, the owner can be confronted with substantial business and
legal challenges. The following are some of the more common and challenging legal
mistakes experienced by small and growing companies.

1. Not making the deal clear with co-founders - An entrepreneur should agree early on with
co-founders about the details of the business relationship. Without these details, the
business may later on face legal problems such as the scandalous litigation between
Zuckerberg and Winklevoss of Facebook. This founder agreement can be likened to the
"prenuptial agreement."

2. Not beginning the business as a corporation or LLC - The legal form to operate the
business is one of the very first decisions founders must make. Often, businesses start with
no lawyer consultation hence they suffer from higher taxes and big amount of liabilities.
These things could have been avoided if founders had structured the business as a
corporation or a limited liability company (LLC).

3. Selecting a company name that has trademark issues, domain name problems, or other
issues - It is vital to do research first before selecting a company name. This way trademark
infringement or domain name problems can be avoided. This also ensures that the name
chosen is actually open to use. An entrepreneur may be trespassing on someone's
trademark if he uses a mark that is likely to cause mix-up among customers as to the source
of the goods or services.
4. Not conforming with securities laws when allotting stock to angels, family, or friends
Failure to obey with applicable securities laws requirements can result in considerable
business disadvantages for the founders and the startup company This includes a necessity
that the company repurchase all shares sold to all investors in the illegal offering at the
original issuance price of the shares, even if the company has nowhere to be found most,
and perhaps all, of the money it raised from the investors. There can also be fines and other
penalties both civil and criminal that would be imposed for failures to obey with the securities
laws. Hence, founders should employ experienced lawyers to document the sale of shares in
compliance with such laws in order to avoid such harmful cornsequences.

5. Not sufficiently considering important tax considerations - Startups are required to pay
attention to numerous key tax issues connected to their businesses. Without good planning,
founders can be implicated or their startups accountable for inadvertent and unforeseen
taxes, fines, and penalties.

6. Not having the right legal counsel-Often, startup businesses employ inexperienced legal
counsel who could be their friends or relatives to save on expenses. This is a misguided
effort, which denies the founder the advice of experienced legal counsel who can help
escape numerous legal problems. Founders need to consider the service of lawyers or law
firms that have expertise in some, if not all, of the legal areas.

7. Not keeping correct corporate and HR documentation - Companies are often messy in
maintaining suitable corporate and employee/HR-related records. This can become
challenging when the company tracks financings, or is involved in claims or lawsuit with an
employee or regulatory agency.

8. Not prudently considering intellectual property issues - If the owner has developed a
unique product, technology, or service, he needs to study the applicable steps to safeguard
the intellectual property he has developed. Both the company's founders and its investors
have a stake in making certain that the company protects its intellectual property. In this way
he avoids trespassing the intellectual property rights of third parties.

9. Not coming up with a well-written contract - Most startup companies should have standard
form contracts for dealing with customers or other stakeholders. Obviously, every contract
can be custom-made to be more advantageous to one side or the other. The important thing
is to start with a good form and hope it appears satisfactorily sensible that the other side
would not try to discuss its terms. The contract should visibly spell out simple terms like a
description of the deliverable(s), agreement on pricing, when payment will be payable, what
penalties or interest will be owed if payment is not appropriate, and how the contract can be
altered.

10. Not having a good terms of use agreement and privacy policy for the company's website
-A terms of use agreement sets forth the terms and conditions for people using a website. A
privacy policy is a legal statement on a website setting forth what the owner will do with the
personal data taken from users and customers of the site, and how such data may be used,
sold, or shared to third parties.
11. Not using a good form of employment agreement or offer letter when hiring employees
Often oral agreements lead to misinterpretations. If an owner plans to employ a potential
employee, he should use a cautiously written offer letter. The promising employee must be
encouraged to review this letter sensibly before signing. A good offer letter or employment
agreement must contain the full details of the employment that makes sense.

12. Not demanding all employees to sign a confidentiality and invention assignment
agreement Companies compensate employees to come up with ideas, work product, and
inventions that may be beneficial to the business. Employees have access to a good deal of
their company's private information, which can be very treasured, particularly in technology
companies. One simple way to look after proprietary company information is with the use of
a confidentiality and invention assignment agreement. This type of agreement deals with
secrecy issues. It can also guarantee that the ideas, work product, and inventions the
employee produces that are connected to company business is owned by the company and
not the employee.

13. Asking interview questions that are banned by lato - The laws forbid employers from
making hiring decisions based on protected categories such as age, religion, medical
conditions, arrested or convicted of a crime, disabilities, illnesses, political affiliation and
others should be avoided. Asking off beam questions could lead to a discrimination claim
contrary to the company, even if decisions are not formed on that basis.

14. Not taking the correct steps before firing an employee Ending the service of an
employee, even an "at will" employee, involves legal risk if not accurately controlled and
properly documented. Laws disallow termination based on color, national origin, ancestry,
gender, race, age, disability, marital status, religious preference, sexual orientation,
absenteeism due to jury duty or military service, retaliation for sexual harassment,
discrimination, or other claims by the employee, and many other factors.

Types of Intellectual Property (IP)

intellectual property or simply IP is a type of property that comes from the products of mental
effort and usually compose of copyrights, trademarks, patents, and trade secrets. Industrial
design and geographical indications or appellations industrial design and geographical
indications or appellations can also be as IP. Intellectual properties are a and human's
intelligence product of a considered creativity that need to protected by law. The Philippine
government really tries hard to provide security and protection over these assets, hence the
creation of Republic Act No. 8293. With this law, more businesses and individuals are
encouraged to continuously produce intellectual properties. Being all intangibles, these
creations should be guarded and preserved by law. These masterpieces done by intelligent
minds ought be given credit and recognition

Here are the types of "intellectual property rights" protected by Philippine law:

Copyright and Related Rights Copyright and other related rights consider the safeguard of
literary, scientific, and artistic pieces or domain. These rights comprise of books and other
literary articles, films, paintings, audio or music, and computer or software programs. The
moment authors and artists produce their creations or work; they are approved of their
copyrights automatically under the law. Anyone with copyright protection can have exclusive
right of his creation or work. Owner and holder of the copyright protection may allow or
disallow the duplication of their work in any manner, shape or form. In the Philippines,
copyright protection for artistic, literary and derivative works lasts for the duration of the
author's life plus 50 years after the author's death. This term of protection also relates to
posthumous works. In the case of shared authorship, the economic rights shall be protected
for the duration of the last living author's life plus 50 years after such author's death.

Trademarks and Service Marks

A mark is an invisible sign to differentiate goods (trademark) and services (service mark). A
trademark may be a word, a group of words, signs and symbols, logos, or a mixture of all of
these mentioned. The primary source or origin of products and services as one entity
differing from the rest can be seen in the trademark. The symbol "TM" means that the mark
has a pending application; while, the symbol "" means that the mark is registered. Trademark
rights are usually used by businesses for protection and for their advantages on competition.
These rights besides protection offer exclusivity to prevent exploitation from other people or
companies. Moreover, trademarks can be a good source of income through licensing and
franchise. Goldilocks, National Bookstore, SM and Andok's are some popular trademarks in
the Philippines

It takes around 6 to 18 months to complete the whole application process for trademark due
to examination and publication. The government fee for a trademark application in one (1)
class is Two Thousand Five Hundred Ninety-Two Pesos (P2,592.00). If the trademark has
color, there is an additional Six Hundred Pesos (P600.00) must be paid for each class.
Goods and services are grouped into different classes which are guided by the Nice
Classification (pursuant to an international treaty). It is best to consult with an intellectual
property lawyer about this matter and other details that must be clear in the application form.
The Nice Classification (NCL), created by the Nice Agreement (1957), is a global
classification of goods and services used for the registration of marks. A new edition is
circulated every five years, however since 2013, a new version of each edition is published
annually.

Geographic Indications

A geographic indication can either be a name or a sign used by and for a product from a
specific geographical location. This may serve as a guarantee or a right that a certain
product has a direct qualitative link to its geographical origin for the reason of the soil,
topography, climate, human skills or traditions of the place of origin. The reason for the GI
protection is that specific geographical locations yield product qualities, characteristics, and
reputation that are incomparable. Besides being widely known for producing a product, this
is also a point of advantage. The most famous Gls are Old World wines, such as
Champagne, Scotch, Cognac, Sherry, Porto, Burgundy, and Bordeaux. In the Philippines
some famous products that are being considered for Gl are Bonoan bangus (milkfish), Bicol
pili nut, Bongolan banana, Batangas Barako coffee and Kalinga (Arabica) coffee.

Industrial Designs
Industrial designs could either be three-dimensional features (with shapes and surfaces) or
two-dimensional ones (with patterns, lines, or color). Essentially, the scope of industrial
designs ranges from fashion to industrial goods such as handicraft, vehicle, jewelry, fashion
pieces, appliances, and a whole lot more. This is advantageous to the owner because no
other parties can produce and sell the goods that is copycat of the design. An industrial
design can be registered for a period of 5 years from the filing date of the application. It is
renewed for not more than two (2) consecutive periods of five (5) years each by paying a
renewal fee. The fee must be settled within a year of the expiration of the registration.

Patents

A patent is an exclusive right granted to inventors, which provides a new product or a new
way of doing something or offers a new technical solution to a problem. Inventions can be
electrical, mechanical, or chemical in nature. The patent system is conceived to inspire
inventions that are exceptional and beneficial to society. However, patents should be new,
inventive, and industrially relevant. Patent owners are awarded sole rights in stopping other
people from making, using, or selling the output of his creation during the whole legality of
the patent. The term is twenty (20) years from the international filing date of the application.

There are three different kinds of patents namely:

1. Utility Patents These most common patents are accorded to new machines, chemicals,
and [Link] Employees
2. Design Patents - Awarded to care for the distinctive look or shape of invented objects,
such as the surface ornamentation or overall design of the object.
3. Plant Patents Given for the invention and asexual reproduction of new and distinct plant
types, such as hybrids (asexual reproduction means the plant is reproduced by means other
than from seeds, like grafting or rooting of cuttings).

Layout-Designs or Topographies of Integrated Circuits

These types of designs are usually three-dimensional elements or forms intended for
manufacturing. Owners of this invention or idea are granted rights in preventing other parties
from using the registered item or device for commercial purposes. Topographies, as
compared to invention patents, are relatively inexpensive, easier to acquire, with fewer
requirements needed. As RA 9150 covers these designs and describe as:

1. An Industrial Design. It is any arrangement of lines or colors or any threedimensional

form, whether related with lines or colors. The design must be a structure or form which
gives a unique appearance and can provide as a blueprint for an industrial product or
handicraft.

2. Integrated Circuit - This means "a product, in its final form or intermediate form, in which
at least one of the elements is an active one, and some or all of the interconnections are
inherently formed in and/or on a piece of material. This is intended to perform an electronic
function".
3. Layout-Design Synonymous to topography means the three-dimensional disposition.
"Among the elements, at least one of which is an active element, and of some or all the
interconnections of an integrated circuit, or such a threedimensional disposition planned for
an integrated circuit meant for manufacture".

Protection of Undisclosed Information

One of the most important if not the most important among the types of intellectual
properties that needs to be safeguarded by law is the undisclosed information. This
undisclosed information is considered vital in either bringing benefits or scare to the country.
Most of the times the government trim down and circulate only that information that will not
be the cause of trauma and panic among people. Usually, undisclosed information is
reviewed in closed-door meetings with no media around. Hence, in the Philippines, this is
the rationale for IP protection. The security is provided to undisclosed information because it
is valuable and vital for the whole country.

Common Mistakes to Avoid with Intellectual Property

Intellectual property has abundance of benefits for startups and getting it sorted out will help
a business to achieve. However, a lot of startups fail to utilize IP to their advantages. Here
are some of mistakes committed against IP which needs to be avoided.

The right people must be chosen when starting a business. Talented pool of employees is
needed to grow and keep the business running. Choose candidates who can think outside of
the box and show that creativity upon which startups succeed. Here are some suggestions in
recruiting employees. When enough capital has bee raised, the recruitment must
commence. The process must not wait until the business has, started. These days, a lot of
recruiting activities take place in networking and social media sites which consist of Linked
In, Google and Twitter to find applicants.

Here are some of the most usually recommended first hires for a startup business.

1. CEO and COO- The CEO (Chief Executive Officer) is normally the big-picture person who
controls the company's mission, vision and culture. The COO (Chief Operating Officer) is
chiefly concentrated on the daily operations to keep the business running.

2. Product manager - The product manager will be the one who handles all things
associated to products. This team member manages the product strategy, vision and
development. He typically works side-by-side with the engineering and marketing teams to
create and market the product.

3. Chief technology officer (CTO) A team member who focuses in technology and
development is crucial to a business's success, especially for technology- based startups.
Although an entrepreneur can employ a freelancer, it can be beneficial to have someone on
internal team to assume responsibility of this sector especially when there is enough budget.
4. Chief marketing officer (CMO) - This team member will attend to the customers and focus
on how they perceive the product or service. Hiring an expert with excellent marketing and
promotional skills is necessary to make certain the vision reaches a broad audience.

5. Sales manager - This team member will concentrate on making new leads and giving in
money for the company. Startups and small business owners who master sales are good
candidates for this position.

6. Chief financial officer (CFO) Experts propose that startups outsource their accounting and
finance roles. However, if they have the capability to hire a CFO, it can be extremely useful
for any business.