Freedom To Operate Opinion Letter (FTO)

What is an FTO?

A Freedom to Operate (FTO) opinion letter provides an expert analysis of whether a product, process, or service infringes on the enforceable rights of others, particularly in terms of patents.

The FTO opinion evaluates the risk of potential infringement in a specific market, thus informing a company about its "freedom to operate" within that market.

What are the benefits of creating an FTO?

1. Risk Management: It helps in identifying potential legal pitfalls related to patent infringement before a product or service is launched. Early identification of risks allows the company to modify its plans or negotiate licensing agreements to mitigate these risks.
2. Strategic Planning: The FTO opinion letter informs the company about the intellectual property landscape in a specific market, which can influence strategic decisions, such as choosing locations for manufacturing, distribution, and sales.
3. Investor Confidence: Demonstrating that a company has sought and received a positive FTO opinion can boost investor confidence by showing that the company has taken steps to minimise legal risks related to patents.
4. Business Partnerships: It can facilitate business partnerships and agreements, as other businesses or potential partners may be reassured by the due diligence performed in obtaining the FTO.
5. Cost Savings: Although obtaining an FTO opinion involves an upfront cost, it can potentially save a company significant resources in the long term by helping to avoid costly legal disputes or redesigns due to patent infringement.