International Law

An Exception To My Usual Rule ? Some China Patent Statistics

By Stan

I usually don’t bother posting the latest statistics from the State Intellectual Property Office, the Trademark Office, or the Ministry of Commerce. Too hard to decipher, too easy to question, and not enough detail from which to make useful conclusions.

On the other hand, sometimes numbers can be illuminating. Moreover, when the numbers are packaged in an appealing way (as opposed to the usual Xinhua article), the whole thing is much more palatable.

Case in point is an article put out by U.S. law firm Sheppard Mullin last week. Lots of the usual data from SIPO in there, but it is easy to read and therefore relatively painless. Here’s the headline stuff:

The Chinese government?s emphasis on boosting innovation might be proving fruitful. According to the latest statistics from the State Intellectual Property Office (?SIPO?), the government entity responsible for prosecuting patents, there were 426,000 patent applications filed and 252,000 patents granted in China during the first half of 2009. Compared with the first half of 2008, patent filings are up 31.3 percent and patent grants are up 23.1 percent. (Sheppard Mullin China Law Update)

A couple special things to point out. First, lots of Chinese companies are getting invention patents. This is a recent trend and in line with China’s move towards an innovation society.

Out of the 426,000 patent applications filed, 148,000 were invention patent applications (34.8%), 142,000 were utility model patent applications (33.4%), and 136,000 were design patent applications (31.8%). For the first time, invention patent applications filed by Chinese enterprises accounted for over 70 percent of the total invention patent applications filed. Also for the first time, the number of invention patents granted to Chinese enterprises surpassed those granted to foreign enterprises.

Among the 426,000 patent applications, 375,000 applications were filed by Chinese enterprises, representing 88 percent of the total number of applications filed.

I’d love to see some breakdowns into the specific kinds of patents (i.e. the kinds of technology involved) approved.

Second, and related, is the widespread use of government incentives to defray costs of filing patents, both in China and abroad.

A key reason for the sharp increase in patent filings by Chinese enterprises is the creation of reward systems by provincial governments. For example, for enterprises and individuals located in Beijing, the Beijing government will subsidize the applicant of an invention patent application the following: (1) up to 950 RMB in application fees; (2) up to 1200 RMB in examination fees; and (3) 50 percent of other filing fees actually incurred. For invention patent applications, the official filing fee is 950 RMB and the examination fee is 2500 RMB. This means the Beijing government is subsidizing over 50 percent of the official filing fees for invention patent applications. In Beijing, the rewards for utility model patent applications and design patent applications are substantially less, with a maximum amount of 150 RMB. Provinces across China employ reward systems similar to the Beijing system.

Coincidentally, I just had a talk about this subject with a friend of mine who runs a local patent agency. I mentioned that although I knew about the incentive programs, I had no information on whether the information about them had been widely circulated among Chinese companies.

His answer was yes, absolutely, and that the incentive programs were a major reason for increased filings both in China and abroad. This anecdotal evidence seems to agree with the aggregate numbers.

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Full post as published by China Hearsay on August 24, 2009 (boomark / email).