Companies need freedom to operate
In a freedom-to-operate (FTO) analysis, companies evaluate whether there are property rights that would stand in the way of the development, manufacture and marketing of a product.
Prohibitive intellectual property rights (such as patents, brands or utility models) may affect either the entire product or the components, production methods, technical details or design and brand elements of the product.
A careful freedom-to-operate research analysis for a specific country always takes into account internationally and regionally submitted patent applications, as national IP rights may result from these applications.
When the freedom to operate is restricted
If a company identifies a potentially dangerous intellectual property right during a freedom-to-operate analysis, this can have significant implications for strategic management decisions. In some cases, the development of a product may have to be discontinued due to opposing patents.
Often, as the result of FTO research, solutions will be sought during product development that circumvent the competitor’s intellectual property (workarounds).
Another approach is to initiate research on prior art regarding the impeding intellectual property. If prior art puts the validity of the relevant intellectual property into question, the risk can be significantly reduced.