Intangible assets now account for between 60% and 80% of the market value of a typical company in technology, professional services, or branded consumer goods. Yet most Spanish SMEs lack any systematic strategy to protect their intellectual property, creating serious vulnerabilities against competitors and in the context of a potential sale or funding round.
Spain’s IP Framework: Industrial vs. Intellectual Property
The Spanish legal system draws a clear distinction between intellectual property (IP) — protecting creative works such as literary, artistic, musical creations and software — and industrial property (IPR), which covers inventions (patents and utility models), industrial designs, and distinctive signs (trademarks and trade names). The Spanish Patent and Trademark Office (OEPM, based in Madrid) is responsible for registering industrial property rights. Intellectual property, by contrast, arises automatically upon creation without formal registration, though recording with the Intellectual Property Registry is strongly recommended as evidence of prior authorship.
For companies operating across Europe, the EU Trade Mark (EUTM), administered by the EUIPO in Alicante, offers protection across all 27 Member States through a single application. At €850 for one class and €50 per additional class, it is considerably more cost-effective than equivalent national registrations combined.
Trademarks: Protecting Your Commercial Identity
Trademark registration is the most accessible and cost-effective form of IP protection available to any business, regardless of size. A registered trademark grants the exclusive right to use the sign for the goods or services for which it is registered (across the 45 classes of the Nice Classification) and entitles the owner to demand cessation of infringing use and claim damages.
The three most common trademark mistakes made by Spanish companies are: operating without registration for years until a conflict arises; failing to cover all relevant classes (for example, a software company that registers only in class 42 for services but neglects class 9 for downloadable products); and failing to renew at the 10-year mark, losing accumulated protection.
Patents and Utility Models: Protecting Technical Innovation
Patents protect technical inventions satisfying three requirements: absolute novelty (not previously disclosed anywhere in the world), inventive step (not obvious to a skilled person), and industrial applicability. Applications may be filed through the national route at the OEPM, the European route at the EPO (covering up to 44 countries), or the PCT route for worldwide coverage.
The utility model — specific to Spanish law — protects minor inventions or improvements with a faster, less expensive procedure (10-year term versus 20 for patents). It is the most practical option for product improvements or new configurations that do not reach the inventive step threshold required for a full patent but warrant protection against copying during the product’s commercial lifecycle.
Software and Databases: The Most Frequently Unprotected IP
Software is protected in Spain as a literary work under the Intellectual Property Law (Royal Legislative Decree 1/1996) without the need for registration. However, this automatic protection coexists with critical contractual gaps affecting many companies:
Externally developed code. When software is built by an outside company or freelancer, ownership is not automatically transferred to the commissioning company. An explicit assignment of rights clause is required in the contract. Without it, the developer retains exploitation rights — a fact that routinely blocks corporate transactions.
Open source and copyleft licences. Uncontrolled use of code under GPL or AGPL licences can create obligations to publish the proprietary code that incorporates them. Any technology company must maintain an inventory of the open source dependencies in its products and verify licence compatibility before shipping.
Trade secrets. Know-how, algorithms, customer data, and pricing structures that are neither registered nor patented can be protected as trade secrets under Law 1/2019 on Trade Secrets (transposing EU Directive 2016/943). This protection requires demonstrating that reasonable steps were taken to maintain confidentiality — hence the importance of properly drafted NDAs, restricted system access controls, and documented internal policies.
IP in Corporate Transactions: Due Diligence and Valuation
In any M&A process, venture financing round, or IPO, intellectual property due diligence is one of the core pillars of the transaction. Buyers and investors examine: effective ownership of key intangible assets (ensuring there are no defective agreements with external developers), the existence of valid and current registrations, the absence of invalidity proceedings or prior rights conflicts, and the robustness of the trade secret protection system.
A well-structured IP portfolio not only protects the business but materially increases company value. Private equity funds routinely apply a valuation discount when they identify IP title weaknesses, on the basis that the core asset of the business is insufficiently secured.
The Patent Box Regime: A Tax Incentive Worth Knowing
Companies that license or transfer patented technology, registered software, or other qualifying IP assets may access the Spanish Patent Box regime under Article 23 of the Corporate Income Tax Law. Qualifying income from IP assets that have been self-developed receives an 80% reduction in the tax base, effectively reducing the applicable corporate tax rate from 25% to 5%. For R&D-intensive companies, this represents a material tax planning opportunity that should be structured proactively rather than discovered retrospectively.
Building Your IP Action Plan
The starting point is a complete inventory of the company’s intangible assets: registered and unregistered trademarks, internally developed software, databases, existing or potential patents, and critical know-how. Next, verify the documented ownership of each asset and identify contractual gaps. Finally, establish a maintenance calendar for registrations — trademark renewals, patent annuities — with assigned responsibilities.
At BMC, we support companies in diagnosing and structuring their intellectual property portfolio, coordinating the legal, tax, and strategic dimensions of IP management. Discover our intellectual property legal services.
