South Korea and China transform the geography of patents

The World Intellectual Property Organization’s (WIPO) statistics on patent filing underline the extent of the seismic shifts in innovation activity around the world. A record 145,300 were applications filed in 2006, representing a 6.4 per cent growth over the previous year. For the third year running, the most remarkable growth rates came from countries in north east Asia, and represented over a quarter (25.3 per cent) of all international applications under the WIPO’s Patent Cooperation Treaty (PCT). In 2006, the list was topped by applications from the US, Japan, Germany, Republic of Korea and France, respectively.

“The number of international patent applications continues to rise with impressive growth from north east Asian countries,” said Francis Gurry, Deputy Director General of WIPO, who oversees the work of the PCT.

Developing countries learn the system

Increasingly developing country economies are capitalising on the tools of the intellectual property system for wealth creation. Innovation has been traditionally dominated by Europe and North America. New centres of innovation – in particular in northeast Asia – are emerging and this is transforming both the geography of the patent system and of future global economic growth, he added.

The Republic of Korea, which experienced 26.6 per cent growth in 2006 as compared to 2005, overtook the UK and France to become the fourth biggest country in terms of the origin of PCT filings, and applicants from China, where applications grew by 56.8 per cent, dislodged Switzerland and Sweden to take the position of eighth largest country of origin.

With just under 50,000 PCT applications, inventors and industry from the US represented 34.1 per cent of all applications in 2006, a 6.1 per cent increase over 2005. Applicants from Japan, who unseated their German counterparts in 2003 for the number two spot, maintained their second place position with 18.5 per cent of the total number of applications, representing an 8.3 per cent increase.

Inventors and industry from Germany held onto their third position in 2006, with 11.7 per cent of all applications, representing a 5.8 per cent increase. The Republic of Korea accounted for 4.1 per cent of all applications, a 26.6 per cent increase and France 4.1 per cent of all applications and a 2.8 per cent increase.

Among the fifteen top filing countries, others to achieve double-digit rates of growth were Italy (11th highest filer, with a rate of growth of 16.1 per cent in 2006) and Israel (15th highest filer, with a rate of growth of 18.3 per cent in 2006).

Top applicants

The top 5 companies remain unchanged. The Dutch multinational Philips Electronics NV was again the largest applicant with 2,495 applications published in 2006), followed by Matsushita of Japan with 2,344; Siemens, Germany, 1,480; the mobile phone company Nokia, Finland, 1,036; and Bosch, Germany, 962.

These were followed by 3M of the US with 727; BASF, Germany, 714; Toyota, Japan, 704; Intel, US, 690; and Motorola, US, 637. Among the 20 top filing companies, seven were from the USA, four from Japan and three from Germany.

Several companies join the top 20 list, including Huawei of China, up 24 places to 13th, Fujitsu, Japan, up 9 places to 15th, LG Electronics, Republic of Korea up 12 to 16th, and Hewlett-Packard, US up 5 to 18th.

Developing countries

International patent applications received from developing countries increased by 27.6 per cent in 2006 as compared to 2005, and represented 8.2 per cent of all international patent applications filed. This is largely due to the filings from the Republic of Korea (5,935) and China (3,910), followed by India (627), Singapore (402), South Africa (349), Brazil (265) and Mexico (150). Developing countries make up 79% of the membership of the PCT, representing 106 of the 136 countries that have signed up to the treaty to date.

The top ten users of the PCT from developing countries include: Huawei Technologies (China), LG Electronics (Republic of Korea), Samsung Electronics, (Republic of Korea), LG Chem (Republic of Korea), Electronics and Telecommunications Research Institute (Republic of Korea), ZTE Corporation (China), Agency for Science, Technology and Research (Singapore), Ranbaxy Laboratories (India), Council of Scientific and Industrial Research (India) and NHN Corporation (Republic of Korea).

Fields of technology

The greatest number of PCT applications published in 2006 were in telecommunications at 10.5 per cent, pharmaceuticals, 10.4 per cent , and information technology, 10.4 per cent. The fastest growing technology areas are semiconductors, showing a 28 per cent increase), information technology, 22 per cent and pharmaceuticals, 21 per cent.

Other developments

Applicants are increasingly using electronic filing, with just under a third (31 per cent) of applications now filed electronically. A further 25 per cent are filed using PCT-EASY software (electronic bibliographic data with the patent specification on paper). The remaining 44 percent are still filed on paper.

The WIPO PCT receiving office recorded a 3.3 per cent increase in the number of international applications filed directly with them in 2006, representing 5.6 per cent of all PCT applications received in 2006. The PCT receiving office provides applicants with an option to file their international applications directly with WIPO, rather than through the intermediary of a national or regional office.

In addition, WIPO has improved productivity in the operations of the PCT through the implementation of information technologies and outsourcing of functions such as a proportion of the translation work. All PCT applications are now scanned on receipt at WIPO and processed electronically.

Paper publication has been discontinued and PCT publication now takes place electronically via WIPO’s PatentScope portal.

Background

The PCT offers inventors and industry an advantageous route for obtaining patent protection internationally. By filing one “international” patent application under the PCT, protection of an invention can be sought simultaneously in each of a large number of countries.

Both applicants and patent offices of PCT member states benefit from the uniform formality requirements, the international search and preliminary examination reports, and the centralized international publication provided by the PCT system. The national patent granting procedure and the related expenses are postponed, in the majority of cases, by up to 18 months (or even longer in the case of some offices) as compared with the traditional patent system. By this time, the applicant will have received important value-added information concerning the likelihood of obtaining patent protection as well as potential commercial interest in that invention.

The growth rate in the filing of PCT applications has been especially significant during the last nine years. It took 18 years from the beginning of PCT operations in 1978 to reach 250,000 total applications, but only four years to double that figure (500,000), and another four to double it again (1,000,000).