Protecting intellectual property when using a CEM partner
10th June 2020
Knowledge is power and when it comes to intellectual property (IP), protecting it should be a primary motivation for any business. Why is intellectual property so important? Well, it can help you stand out from the crowd, provide an important revenue stream if sold or licensed, can form part of any marketing communications and has the potential to offer customers something new that they can’t get elsewhere.
IP is so key to success that theft is a growing concern and poses a real risk to both small and large businesses alike. In fact, it is estimated that European companies may be losing up to £50bn in annual sales through IP theft in goods and services1.
An area of vulnerability for IP protection is when the product is outsourced during the production process. Choosing a partner that takes IP protection as seriously as you is key to long-term security. So, when looking to outsource electronic manufacturing to a contract electronic manufacturing (CEM), here are some things to think about before making the leap:
1. Does the CEM have a good reputation?
CEM is an area where experience is everything. Does the company have a good reputation within the industry? Also, what IP controls do they have in place to reassure you that they provide enough protection for you and your products?
2. Put it in writing
Ensure that a contract emphasising the protection of your IP rights is signed by the CEM before any partnership is initiated. Remember to include any patents, trademarks, trade secrets and also copyrights. Also make it clear who owns files related to the product build in advance, as some CEM’s will state that if they have done the design for part of a product, they have the IP rights.
3. Ensure data protection compliance
Is your IP data fully protected? Check that the CEM is compliant with the General Data Protection Regulation (GDPR) standards. Compliance with the GDPR gives an indication that the CEM is able to offer a consistent level of protection for your data.
4. Keeping it confidential
Make use of non-disclosure agreements (NDAs) that outline the way you want your product and its IP to be managed. This will help to set an expectation level within the CEM team of how the product and IP are to be handled internally and externally.
The most successful CEM partnerships are the ones where the boundary lines are firmly set at the beginning of the working relationship, ensuring that sensitive manufacturing and customer information can be communicated confidently. Only work with a CEM that can demonstrate that they will protect your IP whilst delivering the best possible products.
1 Source: EUIPO 2019 status report on intellectual property rights (IPR) infringement, 6th June 2019
