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Rising awareness on IPR protection
By Jiang Wei (China Daily)
Updated: 2008-06-16 10:24

Known as the "world's factory", China is not only valued by multinationals for its efficiency and low cost, plentiful labor but also been criticized for its comparatively weak protection of intellectual property rights (IPR).

However, a report recently released by the New Delhi-based global business-research company Evalueserve, shows that the awareness on IPR protection in China has risen during the past two to three decades.

If the current growth rate for filing 20-year patent applications with the United States Patent and Trademark Office (USPTO) continues at its current rate of 8.7 percent, China will overtake the US by 2012 in patent application filings, the report says.

The estimate is based on statistics from the State Intellectual Property Office (SIPO): in 2007, SIPO received a total of 694,153 patent applications, which represents a growth rate of 21.1 percent over the previous year. The growth rate of 20-year patent applications filed with the SIPO between 2000 and 2006 averaged more than 20 percent.

"This also means that the patent protection system in China will be tested more rigorously. Therefore, for the Chinese government developing an efficient patent-protection system is no longer 'good to have' but 'must have'," says Ram Deshpande, senior manager with Evalueserve China in Shanghai.

The immediate impact will be felt by the SIPO which will have to process a much larger amount of applications, Deshpande says. The SIPO will have to train more patent examiners quickly in order to maintain the current clearance rate of applications.

This may also result a higher number of patent lawsuits. Given the growing size of the Chinese markets for all products and services, these lawsuits will involve fairly large amounts of money.

More filings would also require tighter regulations relating to the way applications are drafted, Deshpande says. Faced with a similar situation, the US patent and trademark office had to bring out specific regulations regarding the size of patent applications.

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