Hong Kong SMEs Leverage Intellectual Property to Drive Market Success and Innovation

April 26 marks World Intellectual Property Day, with the 2021 theme focusing on “IP & SMEs: Taking your ideas to market.” Small and medium enterprises (SMEs) in Hong Kong, numbering over 340,000, form the backbone of the city’s economy. These businesses excel in creativity, innovation, and adaptability, but converting their ideas into market-ready products and services requires robust legal protection through intellectual property (IP) rights.

David Wong, Director of Intellectual Property in Hong Kong, highlights the diverse IP tools available to SMEs. “Trade mark law protects brands and business goodwill, while patent law safeguards your research and development output. Registered designs protect the unique appearance of products, and copyright covers original works in literature, art, music, films, broadcasts, and cable programmes,” he explains. The Intellectual Property Department supports SMEs with training and resources on registration, legislation, and promotion to help them protect and utilize their IP assets effectively.

Sanomics, a fast-growing Hong Kong startup specializing in novel gene therapy solutions, exemplifies the strategic use of patents. The company develops liquid biopsy and tissue-based genomic diagnostics to tailor cancer treatments, particularly for lung and women’s cancers. CEO Stanley Yiu notes, “The medical biotechnology field is highly competitive, and speed of invention is crucial. Holding a patent is the first step to proving our product’s effectiveness and gaining trust from patient stakeholders, as a third party confers the patent.”

Yiu further emphasizes that patents facilitate regulatory approvals from agencies like the FDA, EMA, and NMPA. “They also ease our business expansion into Southeast Asia by exempting us from joint venture requirements with local partners. Recently, we secured funding through the Innovation and Technology Commission’s Designated Local Research Institutions programme. Our patent brings both direct and indirect benefits.”

Gee Kingdom, a multiple award-winning Hong Kong brand, has successfully licensed its popular character lines “Mikoko & Nikolas” and “Adorable Dogs” since 2015. These characters appear on a wide range of consumer products—from toys and backpacks to inflatables—and feature in shopping malls across the Greater Bay Area, Mainland China, and South America.

Co-Founder and Creative Director Nikolas Siu shares that the company began creating characters in 2013, registering trademarks and leveraging copyright to protect ownership. “Participating in leading trade shows and connecting with buyers, manufacturers, and agents helped our licensing business take off. Licensing IP assets offers significant potential for continuous growth,” he says. Siu advises startups to ensure their creations have commercial appeal and can be easily adapted into mainstream products.

Ddiin Concept, founded in 2019 by Hong Kong designer Sofia Lee, has gained recognition for innovative design tools such as MAGCON, a multifunctional mini compass that draws perfect circles and patterns without perforating paper. MAGCON raised over HK$720,000 through crowdfunding and won a Merit at the Hong Kong Smart Design Award 2020. Lee later launched EXLICON, an upgraded toolset capable of creating various ellipses, which has raised over HK$500,000 to date.

Ddiin Concept has registered trademarks and design patents in the United States, Mainland China, and Hong Kong to support its business expansion. “We already have a distributor in Japan and are seeking one in Taiwan. We are also negotiating in Mainland China for EXLICON. Our IP assets give distributors confidence that our products are protected from infringement,” Lee explains.

Despite these success stories, many SMEs remain unaware of their IP assets or their value, missing opportunities to enhance profitability and growth.

David Wong underscores the strategic importance of the Greater Bay Area (GBA) as a major market and innovation hub. “In 2020, the Shenzhen-Hong Kong-Guangzhou cluster ranked second among the world’s top 100 science and technology hotspots, according to the Global Innovation Index by the World Intellectual Property Organization. We are committed to developing Hong Kong as an international innovation and technology hub, promoting IP trading, commercializing R&D output, and enhancing IP Manager and Consultation programmes.”

He adds, “We also encourage enterprises to utilize the Original Grant Patent system as a new tool in their patent filing strategy to maximize their IP potential.”

Hong Kong’s SMEs demonstrate that strategic IP management is essential to transforming innovative ideas into competitive products and services, enabling them to thrive locally and expand internationally.