It's patently obvious for innovators


CHINA HAS made the filing of millions of domestic patents the cornerstone of its efforts to transform itself into an innovation hub, and the country is now the world leader in domestic patent application filings.

However, the proportion of recent patent filings that typically represent higher-end innovations has declined in relative terms, according to a European Union Chamber of Commerce in China report, Dulling the Cutting Edge: How Patent-Related Policies and Practices Hamper Innovation in China.

China has long been the world’s factory, but it is increasingly focused on becoming more innovative to offset the negative effects of rising labour and production costs.

In 2011, there were 1.63 million patent applications filed at the Chinese Patent Office (Sipo), but only 32 per cent met the highest threshold for patent quality – new inventions.

“This explosion has come with a price in terms of the quality and mix of patents. This is not in the right direction,” European Chamber secretary general Dirk Moens said.

The report by the chamber’s business manager Dan Prud’homme argues that policy can support moves towards higher-quality patent applications. It makes more than 50 recommendations to Chinese policymakers on how raising incentives for highest-quality patents will better foster innovation in China, including by encouraging foreign companies to invest more in innovation in China.

“One cannot drive or ‘force’ creativity, but only nurture it, whereas creativity leading to breakthroughs of the type that typically produce the highest quality patents at best comes in spurts . . . ” the report said, noting that at least 20 countries have greater innovation potential than the world’s second largest economy.

European trademark and patent attorney Peter Hanna, of Dublin-based Hanna Moore Curley, believes the quality of patents will improve once technology leaders such as Huawei and ZTE become better known, and when China starts to lead the way in other rapidly developing technology fields.

“China is moving up the value chain fast – it has to. As labour costs continue rising, it is no longer the cheapest place to make things. But it has become one of the best places to make high value things,” said Hanna.