By Alessandro Marongiu for Intellectual Property Watch
A European intellectual property information agency recently released a paper explaining a number of tools commonly used in the market to value IP assets.
The document, titled “Fact Sheet: Intellectual Property Valuation,” was published in June by the European IPR Helpdesk, an EU IP service provider under the guidance of the European Commission’s Enterprise & Industry Directorate-General.
According to the fact sheet, calculating the economic value of IP assets is a crucial element in today’s economy due to their increased use as loan security. In addition, IP tools – such as patents, trademarks and copyrights – are progressively becoming an essential factor in many financial transactions.
The paper describes both quantitative and qualitative approaches to valuate intangible assets, including cost-based and market-based methods, option-based methodology and the qualitative evaluation method.
It also indicates the various advantages and disadvantages of each valuation method in order to help small and medium-sized enterprises choosing the best approach in different situations, such as internal management decision-making, IP valuation for litigation purposes and the valuation of an asset at the early stages of development.
Additional information on the European IPR Helpdesk publications can be found here.