by Gary Jones
FLC Washington, DC Representative
Greetings from DC. I am writing this column the day after the 2006 midterm elections which, as everyone knows, bring significant changes to the composition and leadership in both houses of Congress. What this new Congress means for the many bills currently "in process" that are of interest to the S&T (and, by extension, the tech transfer) community is anyone's guess. When Congress goes back to work, some of the items awaiting action include the 2007 R&D appropriations, as well as numerous bills focused on U.S. competitiveness, S&T education, patent reform, and immigration—all of which may affect the S&T community in some form.
Any attempt to analyze the impact of the new Congress on these issues before the new committee chairs are named and committee agendas made apparent would be purely speculative. And so, while the dust clears and we await some concrete indication on how this will play out for our community, I decided to go abroad (or at least international) for this column and expand beyond last month's discussion on the explosion in U.S. patent applications—by highlighting some recent statistics on patenting internationally.
The World Intellectual Property Organization (WIPO) recently issued its patent report, highlighting trends in worldwide patenting activity through 2004. As stated in the press release, there has been a "marked increase in the use of the patent system internationally," with 5.4 million patents in force in 2004.
Further, the data indicate that "the patent system is an integral part of increasing global economic activity, with the increase in patent filings closely mirroring economic growth around the world."
Patent applications filed worldwide nearly doubled from 1985 to 2004, increasing annually since 1995 at an average rate of 4.75 percent to a total of nearly 1.6 million filed in 2004 alone (and over 600,000 granted in the same year).
While there was steady growth in applications filed in the applicant's country of residence (highlighting domestic innovative activity), much of the increase reflected growth in patenting by nonresidents (i.e., in countries outside the applicant's home market). Among the nonresident filings, there was also a noticeable shift toward using the Patent Cooperation Treaty (PCT) system.
Patent filings by residents increased by 3.4 percent globally between 1995 and 2004, with some of the largest increases in the developing world.
The top five countries for total patents filed by residents are Japan, U.S., Republic of Korea, Germany and China. The top five countries exhibiting increases in resident patenting are China (557 percent increase between 1995 and 2004), India (365 percent), Republic of Korea (76 percent), European Patent Office (EPO) (54 percent), and U.S. (53 percent).
Patent filings by nonresidents increased at double (7.4 percent) the rate of residents for the same period. The top five countries for total patents filed by nonresidents are the U.S., EPO, China, Japan and Canada. As with resident filings, the top five countries with the highest increases in nonresident patent filings reflect improvements in emerging markets as attractors for patenting activity; China (644 percent increase between 1995 and 2004) led the way, followed by Singapore (229 percent), Brazil (212 percent), EPO (131 percent), and India (105 percent).
However, even with this rise in patent applications in emerging markets, the use of the patenting system is still concentrated in a few markets; U.S., Japan, Republic of Korea, China and the EPO account for 75 percent of all worldwide patent applications and 74 percent of all patents granted. Comparing country statistics, particularly absolute values, for any economic activity can be misleading. A relative difference in "size of the underlying economy" is but one characteristic that can skew comparisons.
Accordingly, the report normalizes patent filing statistics across population, gross domestic product (GDP) and R&D expenditures, to bring the data into a more common frame for comparison.
Taking population into account, the report highlights resident patent filings per million population in 2004 (see chart to the right).
Finally, there has also been a marked increase in PCT applications, with an "average annual growth rate of 16.8 percent between 1990 and 2005."
There were 134,000 PCT applications in 2005, and 47 percent of all international patent filings now utilize the PCT system.
Filings from the member states of the European Patent Convention constitute the largest country of origin filing group for PCT applications, followed by the U.S., Japan, Germany and France. The fastest growth rates are in Japan (22.4 percent), Republic of Korea (24.4 percent), and China (46.8 percent).
As WIPO points out, interpreting patent statistics can be challenging at best.
While there has been a recognized move toward harmonizing patenting systems, distinct differences remain across the globe—from reporting variations to limits in data availability.
WIPO includes useful "interpretive aids" in its report to help the reader better understand the data presented.
Gary can be reached at gkjones@federallabs.org.
