The Future of Intellectual Property Law in Nigeria: Current Challenges, Prospects and Way Forward with peculiar interest on SMEs – By Chibuzor Ezeabata

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By Chibuzor, Prince Ezeabata

 

  1. 0 INTRODUCTION

The World Intellectual Property Organization (WIPO), refers to Intellectual property as creations of the mind: inventions; literary and artistIntellectualic works; and symbols, names, and images used in commerce. Intellectual Property is simply put the intangible creation of a person’s intellect. Broadly speaking there are two categories to Intellectual Property, namely : Copyright and Industrial Property. Copyright is concerned with musical, artistic and literary creations, which protects the authorship rights, and producers rights to their artistic products of audio and video, Industrial Property on the other hand covers rights in patents, trademarks, industrial designs, utility models, plants and animal varieties, such as Logos, Business Name etc.

Essentially, IP rights are exclusive proprietary rights granted by law to the owners thereof, over intangible assets which are innovative products of the brain or the mind, as opposed to personal or real properties. IP Law therefore encompasses the body of rules and regulations governing the creation, acquisition and protection of the foregoing rights as well as adjudication over allegations of their infringements. Concrete efforts at developing the Nigeria’s indigenous IP regime began to materialize shortly after the country attained independence in the early 1960s and have remained a work-in- progress till date.[1]

Nigeria is unarguably one of the largest economies in the Sub-Saharan Africa.[2]Though she relies majorly on oil, her economy is also grown by pockets of corporate organizations covering almost all spheres of activities within the country, ranging from multinational corporations with offices within the country, indigenous companies, and largely by small and medium scale enterprises (SMEs).[3] These corporate Organizations are products of the mind, innovative ideas and creative technologies, therefore IP Rights is paramount in regulating and protecting the rights of such enterprises in its exclusive use of its products.



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1.1 INTELLECTUAL PROPERTY IN NIGERIA

The Future of the Intellectual Property regime in Nigeria is determinant on its current position and status, therefore it is necessary to consider an overview study of the current position.

In Nigeria, a number of laws have a bearing on the protection and administration of the different rights that make up intellectual property. The three main statutes governing the intellectual property law in Nigeria are the Copyright Act, the Patents & Designs Act, and the Trademarks Act others includes Merchandise Marks Act, and the Trade Malpractices (Miscellaneous Offences) Act.

The Copyright Act is exclusively concerned with  music, publishing, artistic and literary works, this it does with the establishment of    The Nigerian Copyright Commission (“NCC”) – which regulate creative activities in the Nigerian literary, and entertainment industry. Among the laudable achievement of the NCC in its bid to enhance copyright owner’s rights is the issuance of the Copyright (Collective Management Organizations) Regulations 2007 and licensing of Collective Management Organisations to engage in collective management of copyright; issuance of the Copyright (Optical Discs Plants) Regulations 2006, which regulates all disc manufacturing companies in Nigeria by requiring them to compulsorily register with the NCC after meeting certain specified conditions for operation.

Pursuant to the establishment of the Trademarks, Patents and Designs Registry – by the Trade Marks Act and the Patents and Designs Act, under the Federal Ministry of Commerce, the filing of trademarks, industrial designs as well as grant of patents in Nigeria are regulated.

Furthermore, The Nigerian Broadcasting Commission (“NBC”) – established under the National Broadcasting Commission Act (Cap. NII, LFN 2004) is vested with the responsibilities of regulating and controlling broadcasting rights, licenses and assignments in Nigeria;

The National Office for Technology Acquisition and Promotion (“NOTAP “) – established under the NOTAP Act (Cap. N62, LFN 2004) vested with the responsibilities of registering technical service agreements, technology transfers and know-how agreements between Nigerian and non-Nigerian parties.

Several other private (non-governmental) initiatives have also been formed to support the above government agencies in the facilitation and enhancement of IP rights, such as the following:

  • Intellectual Property Lawyers Association of Nigeria (IPLAN);
  • The Nigerian local chapter of the International Association for the Protection of Intellectual Property (AIPPI);
  • Anti-Counterfeiting Collaboration (ACC) of Nigeria;
  • The Performing Musicians Association of Nigeria (PMAN);
  • Copyrights’ Collecting Societies – associations of copyright owners established pursuant to and licensed under the Copyright (Collective Management Organizations) Regulations 2007 with the principal objectives of negotiation and granting of licenses, collecting and distributing of royalties in respect of copyright works; and the
  • Federation of Intellectual Property Owners (FIPO).

 

  • INTELLECTUAL PROPERTY RIGHTS AND SMES IN NIGERIA

Crucial to note, SMEs accounts to the development of many nations, as well as an important contributor to employment, economic and export growth. However, before going further, let us understand what is SMEs and what makes it up : SMEs or otherwise known as MSMEs are Small and Medium Sized Enterprises or Micro, Small and Medium Sized Enterprises, are business ventures which employ fewer numbers of employees. Although this number varies according to different countries, it is similar. According to the European Union (EU), SMEs are categories into micro, small and medium-sized enterprises which employ fewer than 250 persons and which have an annual turnover not exceeding 50 million Euros.

The Central Bank of Nigeria in its monetary policies circular No. 22 of 1988 defined SMEs as enterprises which have an annual turnover not exceeding Five Hundred Thousand Naira (N500,000). For the sake of clarity, the National Policy on Micro Small and Medium Enterprises (MSMEs) has given a clear distinction of enterprises, based on employment and Assets.[4] This is the Nigerian perspective, amongst other things, SMEs are described through their capital, annual turnover, financial strength, cost of projects, scope and size of workforce.

According to an article published at PwC Nigeria[5], In South Africa, SMEs account for 91% of businesses, 60% of employment and contribute 52% of total GDP. In Nigeria, SMEs contribute 48% of national GDP, account for 96% of businesses and 84% of employment.

The Intellectual Property of SMEs which includes its patents, trademarks, industrial designs and copyright are critical to the growth of the economy, as these are it’s identity and when it is protected, the enterprise will benefit from it, and remit its taxes to the government. Unfortunately, there is an overlook towards the protection of SMEs IP, government and relevant stakeholders are more concerned with the  mega industries, and corporate enterprises, and more often, the negligence towards the SMEs sector has given to the decline of Intellectual Property registration by SMEs owners as unnecessary. Each, enterprise no matter its scale – either micro, small or medium – has an existing business name, business Logo, identity, design, graphic description and patent. These are Intellectual Property and without being protected are prone to the  risk of theft and intellectual smuggling. The rights to create, own and use your industrial designs, Patents and trademark are exclusive and confidential to the parties using it, as no third party is allowed by law to make use of it, except with the permission of the owner which must be reasonable and not on the basis of extortionate benefit.

 

   1.3  CHALLENGES OF INTELLECTUAL PROPERTY RIGHTS AND SMES IN NIGERIA

Intellectual Property in Nigeria is not without challenges despite efforts to strengthen IP rights and protection, and this calls for more and more proactive measures to tackle this menace at the individual, corporate and governmental levels across all strata.

Common challenge with the IP is, infringements in form of piracy, counterfeiting, unauthorized/unlicensed use and unfair competition. These activities does not only violate the proprietary rights of IP owners, but denials them their rights to reap the benefits of their inventions and hence, hamper the growth and development of intellectualism, innovation and the entire creative industry in Nigeria, with this more and more people are discouraged from fair competition and innovations.

In 2005, while launching the Strategic Action Against Piracy (“STRAP”) initiative, the then President, Chief Olusegun Obasanjo, captured effectively the socio-economic effects of piracy thus:

“The damaging effects of piracy are visible all around us; the waning zeal for creativity; the dearth of well researched textbooks and reading materials in the education sector; the diminishing of the artistic and literal quality of our stage performance and the increasing colourless and uninspiring products in the visual arts. Expectedly, investors are wary and the younger generation is not encourage d to pursue careers in the arts and entertainment industry. We are all confronted by an attack on our culture and future as a people. We are faced with the reality of a declining economic resource and a source of pride as a nation”.[6]

 

Copyright violation is also one of the major challenges to IP rights and development in Nigeria. This cankerworm manifests more virulently in the following industries: book publishing (book piracy), information and communications technology – ICT – (internet & software piracy) and in film and entertainment (musical & cinematography disc piracy). According to a 2012 study undertaken by some industry analysts, it reveals  that “Nigeria is ranked among countries where piracy is most prevalent with rates as high as 82%, 83%, 83%, 82% and 83% respectively in the years 2007, 2008, 2009, 2011 and 2012.[7]

This has negative effect on the economy as it discourages investments from domestic and foreign investors alike, hinders job creation and causes loss of tax revenues to the government. Socially, it corrupt the cultural values of the country and batter the nation’s image in the International community.

Various SMEs owners are oblivious of their anti- infringements rights, Intellectual Property Rights Protection Laws and their rights to own and use their Creative expressions without interference of any sort and therefore, they fall short to the risk of being taken advantage of, especially as illegitimacy thrives more in Nigeria. Reports by the Nigerian Copyright Commission has it that the Nigerian Software Market has an alarming rate of pirated product contributing to a loss of more than US$82M per Annum (Economist, 2006). Again, the Nigerian film industry loses an estimated amount to the tune of  N4.2M annually due to illegal digital duplication, online piracy and unauthorized rental of video works within the country[8].

 

Most Innovations of SMEs are not registered, therefore exposing them to likely threats of forgery and copying. Registration of inventions is expedient, under the Patents & Designs Act the procedure to register inventions are spelt  out. Furthermore, SMEs owners are discouraged from Intellectual Property Protection Litigation due to the hectic nature of litigation and slow pace of the court system.

 

  • PROSPECTS AND WAY FORWARD

Small and Medium Scale Enterprises in Nigeria accumulates large percentage of the GDP and as such the dare need to focus on the protection of the  Intellectual Property regime is crucial. This will not only prevent dubious ubiquity of idea, but will fast track innovation, and creativity as more and more SMEs owners with the assurance of their rights protected and IP guarantee will sue in more to see that his enterprise develops and grows –  the implications of this in our economy will be more revenue and a better chance of attracting investments from investors and businesses partners. For a transition country such as Nigeria, real economic growth will depend on its ability to create an environment that stimulates Innovation, and strengthening the IP Law regime is key to achieving this.

According to a research published by the International Chambers of Commerce (ICC) and the Business Action to Stop Counterfeiting and Piracy (BASCAP)[9] , The engagement of some organizations in Nigeria like the NOTAP and SON are fostering local innovations in a wide range of sectors as evidenced in the increased number of local Nigerian patents from 100 per year in 2006 to 400 registrations per year in 2014. This is a testament that the large involvement of  organizations such as these will not only foster local innovation of SMEs among a wide range of sectors, but will fast track a robust economy for the Nigeria Nation.

SMEs that use IP report faster growth and higher income than those that do not. Nigeria can potentially empower its SME sector to drive growth, wealth creation, poverty reduction and employment generation. Helping SMEs establish and protect their IP rights are important elements of support that the Nigerian government can provide to its SME sector.[10]

Small and Medium Enterprises Development Agency of Nigeria, (SMEDAN) has a strategic position in this regime. The need to create a working bond with the WIPO, NIPCON, ICC, IPLAN, SON and other relevant organizations like the NBC, NCC, and NAFDAC is pivotal.

Policy and Legal reforms ranging from legal reforms to technical assistance and capacity-building measures, channels for international cooperation and tools for strengthening enforcement practices—all of which are indispensable requirements for the prospect for a better Nigerian economic and IP regime strategy.

 

  • CONCLUSION

Small and Medium Scale Enterprises (SMEs) has been recognized by governments and developmental experts as an excellent resource for a nations economic and social growth. SMEs also help to improve private sector services, partnership and private community based services, they have been sited as the main means of achieving equitable and sustainable industrial diversification and dispersal. [11]

SMEs account for over half of the total share of employment sales. Value added SMEs are effective vehicles for self-sustaining industrial development, as they can grow an indigenous enterprise culture. SMEs represent the sub-sector of special focus in any meaningful economic restructuring program that targets employment generation, poverty alleviation, food security, rapid industrialization and reversing urban migration. [12]

SMEs being the main contributors to Innovation and Creativity, is entitled to a peculiar interest in the Intellectual Property Regime – government, civil society groups and IP organizations should focus more on the protection of Intellectual Property for Small Business Owners and enabling a more easier mechanism wherein complaint and report particularly from SMEs will be looked into.

Aside, there should be reforms to accommodate current tendencies under the IP laws in Nigeria. The engagement of the public by means of symposium in tertiary institutions, community sensitization, and private sector partnership. With the enactment of a robust  legislation, and a more accommodating policy initiation focus on Intellectual Property Rights for SMEs, Nigeria is sure to have a brilliant and bright the future for Intellectual Property Protection for SMEs.

 

 

 

 

Chibuzorprince360@gmail.com  Chibuzor, Prince Ezeabata is a third year student of Law at the University of Abuja, Nigeria as at the time of writing this article. He is a writer, public speaker and an inspirational leader.

[2] Central Intelligence Agency – The World Fact book

[3] Small and Medium Scale Enterprises in Nigeria – An Overview of Initial Set Up [ 22 November 2018 ] By Uche Mekwunye, Benchmac & Ince published on “Small and Medium Scale Enterprises in Nigeria – An Overview of Initial Set Up – Benchmac & Ince” https://www.benchmacince.net/small-medium-scale-enterprises-in-nigeria-initial-set-up/?utm_source=Mondaq&utm_medium=syndication&utm_campaign=LinkedIn-integration

[4] Micro Enterprises – less than 10 employees, and less than N5,000,000 (excluding land and buildings); Small Enterprises – between 10-49 employees, and N5,000,000 to N50,000,000 (excluding land and buildings); Medium Enterprises – between 50 -199 employees, and N50,000,000 to N500,000,000 (excluding land and buildings) – Small and Medium Enterprises Development Agency (SMEDAN) 2007.

[5] “Nigeria SME survey” https://www.pwc.com/ng/en/events/nigeria-sme-survey.html

[6] https://www.mondaq.com/nigeria/trademark/788714/strengthening-intellectual-property-rights-and-protection-in-nigeria

[7] https://www.mondaq.com/nigeria/trademark/788714/strengthening-intellectual-property-rights-and-protection-in-nigeria

[8] Intellectual Property Rights Protection in Nigeria: Challenges and Prospects by Afolayan Oluyinka Titilope, University of Ilorin, Ilorin, Nigeria. Published on International Journal of Library and Information Services – Volume 9 • Issue 2 • July-December 2020

[9] Promoting and Protecting Intellectual Property in Nigeria [July 2015]

[10] Ibid.

[11] Ibid.

[12] Ibid



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