SEVEN REASONS TO PROTECT YOUR IP IN ISRAEL

16.08.2017

Introduction:

Protecting your intellectual property should be an important part of your business strategy. But whether you are an Israeli company or someone from abroad with a presence here, or getting ready to establish an Israeli business or market presence, you need to consider protecting your IP here. Below are seven good reasons to do so.

  • Israel Has a Sound and Growing Economy:

Gross Domestic Product (“GDP”) at current prices for the first quarter of 2017 was 86.4 billion U.S. dollars, up about 1% compared to the same period last year. Israel’s GDP has been growing essentially consistently on a quarterly basis since at least 1995.  The economy grew four percent last year and is expected to expand by 3.1 percent this year.

The business sector contributed about 31.6% of the total. An International Monetary Fund study based on 2016 data ranked Israel’s GDP 35th out of 191 countries surveyed. Based on 2015 data, Israel’s GDP per capita ranked 23rd out of 186 countries surveyed. Its GDP growth is well ahead of world averages.

Annual imports for the period May 2016- May 2017 totaled 62.1 billion U.S. dollars, a 1.9 percent increase over the previous year. Among the major categories of imported goods are electronic products (12.8%), machinery (10.7%), vehicles (7.8%), and medical equipment and pharmaceuticals (6.4%).

Exports amount to about 40% of Israel’s GDP.  Major categories of exported goods include electrical machinery and equipment, mechanical machinery and appliances, sound and TV recorders and reproducers and computer equipment (about 22%) and chemical products (about 11%). Israel’s main export partners are the U.S. (about 28% of the total) and Hong Kong (about 8%). Other major partners include Belgium, the UK, India and China. Recent data indicate current annual exports of about $4,215.5 million.

On 5 August 2017, Standard & Poor’s rating service raised the outlook on Israel’s debt profile to “positive” from “stable”, and maintained its debt rating at A+, citing Israel’s improved economic growth, efforts to rein in spending, and the country’s “remarkable” economic performance since the 2008 global financial crisis.

S&P further noted that “ in view of the improved outlook, it could raise the grade a notch in the next two years”. The agency praised the government for “measures that restrain future expenditure growth” which in turn “could enable the government to resist ongoing spending pressures,” even amid recent tax cuts.

  •  Technology is a Central Pillar of Israel’s Economy:

Israel’s world-wide reputation as the “startup nation” is well-deserved. Israel is a center for development of products having applications in defense systems, medicine, cyber security, and autonomous vehicles – to name just a few. Venture capital is readily available, especially for protectable technologies.

Tech giants from around the world have established research and development centers here and have acquired countless Israeli startups to obtain access to their cutting edge technologies.

A notable example of Israel’s world-recognized technical superiority is in the field of cyber security. There are countless Israeli companies in this field and some are reported to be in the acquisition crosshairs of Microsoft and Amazon. Already, in 2013, IBM bought the Israeli information security firm Trusteer for $650 million and opened a special research and development center here.

Another notable tech sector in which Israel is a world-recognized leader is the life sciences, including medical device technology. An example of a medical products success story is Given Imaging, which developed the “ PillCam”, an ingestible imaging capsule facilitating the visualization and detection of gastrointestinal disorders. In 2014, Covidien (now Medtronic) acquired Given Imaging for $860 million.

Another example is ReWalk, which developed a wearable robotic exoskeleton that enables people with severe spinal cord injuries to move around independently and climb stairs. Founded in 2001, the company went public on the NASDAQ in 2014 and in 2015 reached an agreement to sell its exoskeletons to the U.S. Veterans Administration for use by combat veterans. It is now trading with a valuation of $120 million.

And don’t forget autonomous vehicle control, a well known success story being Mobileye, a world leader in the field, which Intel has agreed to acquire for $15.3 billion.

Put simply, there is a good chance that someone here will do something like what you will be doing and may infringe your rights in the process. That alone is a good reason to protect your IP, especially your technology and product designs, in Israel.

  •  Israel Has The Technical Resources to Help You:

Given Israel’s tech resources, collaboration with an Israeli company is something you should consider. That’s another reason to protect your IP here.

  •   Israel’s Legal System Recognizes the Importance of Protecting IP:

Israel’s IP protection law are modern, and in tune with international standards. Its trademark ordinance was updated in 2010, its copyright law was updated in 2011, and its patent law was updated in 2014. And at the end of July 2017, Israel’s new design protection law was enacted. The new provides world class protection. The new law will come into full force next July, but some parts will already benefit design proprietors. Israel is adherent to various international agreements that facilitate obtaining protection for IP originated elsewhere, and assure priority to an initial foreign filing.

  •  The Patent Law Provides Broad Protection:

Products or processes in any field of technology, which are new, useful, and susceptible to industrial application, and which involve an inventive step are considered to be patent eligible. Only mathematical formulas, methods for medical treatment of human beings, and methods for doing business, are excluded. That’s a pretty short list compared to many other places.

Gene sequences, though naturally occurring, are considered eligible, the act of isolation providing the required novelty. New medical uses of known pharmaceutical ingredients are also patentable, but claims must be in the form, of “composition X for use in the treatment of Y” or “pharmaceutical compositions for the treatment of Y comprising X as an active ingredient”.

Software (both source code and object code) is protected under the Copyright Ordinance. However, the Patent Registrar recently ruled in an appeal on an application filed by our firm for an Israeli company Digital Layers, Israel Ltd., that software is also patent eligible so long as, in its entirety, it constitutes a technical contribution, e.g., an enhancement to computer functionality, as distinguished from simply automating a known process. No country provides better patent protection for software.

In terms of patentability, Israel’s requirements for novelty and full disclosure are interpreted similarly to those in the U.S. The requirement for an inventive step involves a determination of obviousness in relation to the prior art as a whole from the viewpoint of a person of ordinary skill in the art, and looks for motivation to combine the teachings of different items of pertinent art, again, similar in most ways to U.S. practice.

  • The Israel Patent Office and the Courts are Patent-Friendly and Cost-Efficient:

Israeli patent examiners are good at what they do and they recognize that their job is to grant good patents and not to look for reasons to issue rejections. Prior art searches are of excellent quality and filing costs are relatively low compared to other countries providing quality services. We often recommend that international applications be initially filed here for that reason.

Another noteworthy feature of Israel’s patent law is the possibility of avoiding substantive examination altogether. If you have filed a corresponding application which has been examined and allowed in Austria, Australia, the U.S., Germany, Denmark, the UK, the Russian Federation, Japan, the European Patent Office, Norway, Canada, or Sweden, you can submit the allowed claims in your Israeli application and, as long as they are directed to subject matter which is patent eligible here, the examiner will usually allow the same claims without further examination as to novelty, inventive step, unity of invention and enablement. Sometimes, a positive international (PCT) examination will also be accepted.

Even if you receive a first Office Action from the Israeli examiner before a corresponding foreign application has been allowed, extensions of time to respond are available and will often allow sufficient time for prosecution of a corresponding application to be completed.

This option can be cost-saving and may help assure that the patent protection you get in Israel will correspond that you receive elsewhere.

Moreover, if you have to sue for patent infringement, you will find that Israeli judges do not generally have an anti-patent attitude, as is sometimes the case elsewhere, e.g., in the U.S. Only limited pretrial investigation (“discovery” as it is referred to under U.S. practice) is permitted and trial by jury does not exist in Israel, making litigation more streamlined and far less costly than in the U.S.

  •  Israelis Are Happy With Their Country:

Finally, considering that Israel is less than 70 years old, was based originally on an agrarian economy, was founded on socialist principles by refugees from a war-torn world, and from the beginning has been surrounded by hostile neighbors, what has been accomplished here is astonishing, to say the least. No one would say Israel is a utopia, but Israelis are happy with their country. The 2017 World Happiness Report ranked Israel 11th out of 155 countries surveyed. Notably, that put it ahead of the U.S., all of Europe other than the Scandinavian countries, Iceland, the Netherlands, and Switzerland, and virtually everywhere else other than Canada, Australia and New Zealand.

 How We Can Help You:

Only those registered to practice may represent applicants in the Israel Patent Office. Our firm has extensive experience in all aspects IP protection from strategic planning to enforcement of protected rights. Whether you are a domestic business, a foreign enterprise entering or planning to enter the market here, we can provide expert and effective assistance.

Feel free to contact us if you have specific questions or desire further general information.

 

 

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