Intellectual Property


Competitive Advantages

By exercising timely protecting of their intellectual property rights businesses can gain an advantage over their competitors
as noted by Alexander Pakharenko, Partner of Pakharenko and Partners IP and Law Firm.

Judging from your company’s experience, do you think that economic recovery is possible in our country?

I am absolutely sure that it is possible! Despite the complicated current political situation, we do not perceive any pessimistic moods when communicating with our clients and partners. The previous year, which was very difficult for our country, allowed the whole world to find out more about Ukraine and its citizens, who have stuck together in their fight for their independence, territorial integrity and economic prosperity. During this period both our partners and clients, who are not only national but also foreign companies, have become much more active. Very often our clients rely on us not only in IPR protection issues but also asking for our legal support in a whole variety of matters pertaining to their commercial activity.

It is particularly exciting to notice that many national companies become aware of the importance of protecting their IP rights and are acting proactively to prevent any problematic situations occurring.

Another optimistic factor is that our country’s leaders have finally realized that a strong system of IPR protection and enforcement means an attractive investment climate, inflow of foreign investments and development of domestic entrepreneurship and thus the reforms in this field would have real returns to the state and bring Ukraine and its national businesses to  leading positions. The said developments will generate revenues to the national budget and result in an increase in the country’s welfare and people’s well-being. That is why this is my strong belief that the economic upturn is not only possible - it has already begun.


What results should be expected from reform of the IPR protection system?

At the end of August this year our company’s general director Antonina Pakharenko-Anderson took part in a meeting dedicated to reforming the state system of IPR protection which was headed by Prime Minister Arseniy Yatsenyuk. As result of the meeting a plan to introduce the reform of IPR protection system in Ukraine was approved. According to this plan the Ministry of Economic Development and Trade was commissioned to table to the Cabinet of Ministers for consideration five key draft laws to lay the basis for reforming the state system of IPR protection.


The purpose of the said draft laws is to set the main principles of reform in the following key directions: protecting copyright in the Internet, setting up a market to administer the collection of royalties for copyright holders, preventing patent trolling, simplification of the IP procedure in the area of IT-development and public access to licences, as well as strengthening liability for IPR violations.       


Together with the other stakeholders we are actively involved in law-making through the  submission of our proposals, providing substantiations for the necessity of specific amendments to existing laws. Still, it would not be true to say that our laws are poorly written. In terms of legislation in the field of IP Ukraine has kept pace with Europe for a long time and assured its full compliance with EU requirements. Only some minor changes are required for complete harmonization.


At the same time, things are worse with enforcement and in this field some fundamental changes are needed, mainly relating to stepping up liability for  infringers.


As far as the results are concerned, one of the most important results which are expected is Ukraine’s positive image of a country with a strong IPR protection regime. Development of an up-to-date legislative framework in this field may increase Ukraine’s investment attractiveness, allow the achieving of its economic potential and avoiding sanctions applied to countries with a high level of Internet piracy. Furthermore, it will enable Ukrainian legislation to be brought into line with EU standards and facilitate the performing of its obligations under the EU-Ukraine Association Agreement.


Is IPR protection really so important for achieving success in business activity?

Absolutely, because a rights holder gains real benefits in the market and the businesses that own intellectual property rights show better economic performance, and thus are more competitive in their sector. In June 2015 the study on the contribution of IPRs to individual firms was published by the OHIM jointly with the EU Observatory on Infringements of Intellectual Property Rights. According to the study results 50% of European companies are intensively using IP rights and generate around 39% of gross domestic product (amounting to nearly 4.7 trillion Euros). These businesses provide 77 million jobs (approximately 35% of total employment in the EU). 40% of larger firms have registered IP rights. At the same time, the businesses that own IP rights generate 32% more revenue per employee than those that do not own such rights and create more jobs with a higher salary (715 EUR per week). Such enterprises account for 90% of the EU’s trade with the rest of the world.


Do foreign companies ensure complete protection of their IPR before entering other markets?


Obviously no company enters the market of a particular country unprepared and empty handed. Before starting its business activity a company makes sure to register its trademarks, industrial designs and inventions there. And if a country has a reliable IPR protection and enforcement regime, it will surely be attractive for potential investors.


And what about Ukrainian companies? Do they also need to take care of their IP rights protection when entering Western markets?


If they really want to compete with European companies, they have to. The analysis of  Ukraine’s economy in relation to IPR protection carried out by OHIM this April confirms that protection of IPR-related assets is one of the main ways of successful business expansion in our country. The first step is to obtain protection documents for one’s trademarks, industrial designs, inventions and other IPR objects not only in our country but in the European Union as well. Nobody can avoid this if he wants his business to grow. What is more, negligence in IPR-related issues leads to significant financial losses. Among our clients there are companies who came to a dead end with potential distributors due to unresolved issues of trademark protection though huge costs had already been spent to  promote a product.


Your company is one of the leading firms in the market of intellectual property law services. What achievements do you consider to be the most important in your records of accomplishments?


We don’t maintain any such records. Moreover, we are not authorized to disclose the details of cases handled on behalf of our clients, such as company names, trademarks and the subject matter of cases. All of this is strictly confidential. We value all our clients and are committed to providing professional services in protecting their interests.


In my opinion, our company’s main accomplishments became possible due to the work of our team of highly qualified professionals who possess huge and broad experience. And the best acknowledgement of our success is the fact that despite these hard times we have not only retained out existing clients but also attracted new ones. It means that clients trust us. And winning the trust of clients is the highest accolade for our company.