CHINA: Racing ahead in patenting

China today is the third most prolific patent-filing country in the world after the United States and Japan. The State Intellectual Property Office of China (SIPO) received more than 694,000 patent applications in 2007 including more than 245,000 20-year patent applications and more than 181,000 10-year patent applications, says a report by Evalueserve, an international business research and analytics company. By contrast, the Indian Patent Office received about 35,000 20-year patent applications in the fiscal year 2007-08.

"Patent filing has been growing in both China and India at about 20% a year, compared with a 7% growth rate for the US. However, SIPO received approximately the same number of 20-year applications in 1997 as the IPO did in 2007-08. This implies that India is approximately 10 years behind China," said the Evalueserve report.

If patent filings in China continue to grow at the present rate, SIPO will overtake the US Patents Office by 2012 in innovation patents. SIPO grants three types of patents: invention patents which are valid for 20 years from the date of filing; utility model or 10-year patents; and design patents. The 10-year patents are easier and faster to file than 20-year patents as they do not require any substantive examination and cost less to file.

There are several reasons for the rapid proliferation of patenting in China, especially since China joined the World Trade Organization in 2001. In China, patents are issued faster than in India: the average time taken from filing to grant in 2007 was 26 months for invention patents, 6.8 months for utility model patents and 6.6 months for design patents. In India it takes three to five years for a patent to be granted.

The Chinese government also gives grants to research institutes and universities filing a large number of patent applications. The patent office has many initiatives to create intellectual property awareness among Chinese companies.

Patent filing also reflects the increase in R&D spending and the fast-growing economy has meant more money for research. Universities are flush with funds, said Ram Deshpande, a senior researcher with Evalueserve China.

China has developed its patent system in the past two decades and today has a good searchable online patent database, a robust appeal mechanism and a hierarchy of courts for handling intellectual property disputes. Thanks to these measures, patenting activity has picked up tremendous momentum. Four million patent applications were filed between 1985 and the end of 2007 - the first million took 15 years but the last million took about 18 months.

Manufacturing is the most active sector of patenting in China, with most patents in this class pertaining to systems or machines or composition of matter in the case of drugs. The highest number of 20-year patent applications in 2007 was filed in pharma, telecom and data processing systems.