By Richard Wigley and Chen Wenping of King & Wood’s Intellectual Property Group
There has been a great deal of interest lately – both from inside and outside of China – in P.R.C. governmental policies aimed a promoting "indigenous innovation". In an April 2010 publication entitled "2010 Notification Regarding the Development of Determining ‘ Indigenous Innovation’ Products (Draft Seeking Opinions)" (hereinafter referred to as the "2010 Notification"), and jointly issued by the Ministry of Science and Technology, the Commission for Development and Reform, and the Ministry of Finance, some government initiatives in this regard were addressed. While it makes perfect sense for any country to promote "indigenous innovation" as a means of economic growth, it is valuable to look at one measure of "indigenous innovation" — invention patents. Specifically, it is valuable to look at the growth in recent years of invention patents granted in China, as just one indicator of "indigenous innovation".
The State Intellectual Property Office (hereinafter known as "SIPO") of the P.R.C. oversees the granting of patents in the P.R.C. and provides detailed statistics on its website. Individual year statistics for invention patents granted can be seen for years beginning in 2001 through 2010. For the purposes of this analysis, the years, 2001, 2006 and 2010 were examined. Invention patents were chosen over "design" or "utility" patents because of the higher degree of rigor placed on the examination of invention patents and, arguably, a higher degree of "innovation", in many cases, associated with said patents. The statistics for invention patents for these years are as follows (percentages provided by the authors):
Total Patents and Invention Patents Granted by SIPO (2001, 2006, and 2010)1
| Year | 2001 | 2006 | 2010 |
|---|---|---|---|
| Total Patents Granted | 114,251 | 268,002 | 814,825 |
| Total Invention Patents Granted | 16,296 | 57,786 | 135,510 |
| Total Domestic Invention Patents Granted | 5,395 | 25,077 | 79,767 |
| Domestic Invention Patents as % of Total Patents | 4.72% | 9.36% | 9.79% |
| Domestic Invention Patents as % of Total Invention Patents | 33.11% | 43.40% | 58.86% |
As can be seen from that above statistics, total patents granted have grown by over 700,000 on an annual basis from 2001 to 2010. The sheer growth in patents granted would seem to indicate a move towards “indigenous innovation”, but when one looks at the breakouts of domestic invention patents an even stronger case for “indigenous innovation” can be made. As noted above, domestic invention patents account for 9.79% of total patents granted in 2010, as opposed to only 4.72% in 2001. As such, over twice as many domestic invention patents are being granted relative to total patents granted over this time period. Perhaps more pertinent to the questions being raised regarding the 2010 Notification, domestic invention patents now account for 58.86% of the total invention patents granted, as opposed to only 33.11% in 2001. By the rise in both the numbers of domestic invention patents granted and their numbers relative to both total patents and foreign invention patents granted, it is clear that domestic entities are playing an increasingly large role in "innovation" in China.
Some may question whether SIPO acts more favorably towards domestic applicants and issue more patents, accordingly, in comparison to applications from foreign entities. It is, as such, valuable to look at the corresponding numbers and percentages of applications for invention patents. Again the following statistics can be found on SIPO’s website.
Total Patent Applications and Applications for Invention Patents Filed with SIPO (2001, 2006, and 2010) 2
| Year | 2001 | 2006 | 2010 |
|---|---|---|---|
| Total Patent Applications | 203,573 | 573,178 | 1,222,286 |
| Total Applications for Invention Patents | 63,204 | 210,490 | 391,177 |
| Total Domestic Applications for Invention Patents | 30,038 | 122,318 | 293,066 |
| Domestic Invention Applications as % of Total Applications | 14.76% | 21.34% | 24.00 % |
| Domestic Invention Applications as % of Total Invention Applications | 47.53% | 58.11% | 74.92% |
It can be see that the significant rise in the number of domestic invention patents granted is likely driven not by any inherent favoritism by SIPO towards domestic applicants, but rather by a huge upsurge in filings of domestic invention patent applications. Given this upsurge in applications, the rise in domestic invention patents granted can be expected to continue on its upward trajectory.
Looking at invention patents granted in the P.R.C. is but one possible measure of innovation and is not to be seen as wholly dispositive on the issue. It would appear by this measure, however, that the P.R.C’s move towards "indigenous innovation" is well underway.
This publication is for informational purposes only and it does not in any way constitute a legal opinion.
1 State Intellectual Property Office of the P.R.C., "Statistics", found at http://www.sipo.gov.cn/sipo_English/statistics/ (last visited on February 14, 2011).
2 Ibid.