Asia picks up the pace in the patent race

For an inventor or business, being able to protect ideas can mean the difference between success and failure. However, obtaining a patent is not just about safeguarding intellectual property. It is also one of the clearest indications of the health of a country’s economy and its level of competitiveness in relation to its rivals.

A growing, dynamic economy that makes it easy for businesses and entrepreneurs to flourish is likely to generate a great many patent applications, in contrast to those where inventors and industry are hampered by red tape and struggle under a bureaucratic burden.

So, as Europe looks to recover from the economic downturn, is it right to be worried that in 2012 the greatest number of European patents were filed by a South Korean company? According to the European Patent Office (EPO), which studies all patents registered in Europe, 2012 was the first year in which an Asian company – in this case the technology giant Samsung – filed more European patents than any other firm. Just four European companies made the top ten: Siemens, a German electronics and engineering company; BASF, a chemicals company, also based in Germany; Bosch, a German engineering firm; and Ericsson, a Swedish telecoms company. For the first time, a Chinese company makes the top ten: ZTE, a mobile-phone manufacturer.

On the increase

If that list gives some cause for concern, the overall number of patent filings provides some reason for optimism, according to Benoît Battistelli, the EPO’s president. The number of patents filed by European firms last year was 2.3% higher than in 2011 – a “clear indication”, he said, that European industry “has opted to innovate its way out of the economic crisis”.

But others beg to differ. While 2012 showed a degree of improvement on the year before, the worry is that Europe is beginning to lag behind. Half of the growth in patent filings in 2012 came from Asian countries.

Some countries warrant deeper investigation. Take France, where, according to the European Commission, household disposable income is falling, unemployment is rising and very little growth is forecast for 2013. Yet France saw a 4.7% increase in patent applications in 2012, almost twice the European average and ahead of the United Kingdom, which saw a 2.6% increase.

But even this increase might not be enough to keep France near the front in the competitiveness race. Two years ago, China, South Korea and France applied for around the same number of patents. Now, both Asian countries have moved ahead, with China registering almost 50% more applications than France in 2012.

Europe’s leaders are pinning their hopes on the creation of a unitary European patent giving industry a boost by making it easier and cheaper to get protection for intellectual property across the EU. However, according to Bruno van Pottelsberghe of Bruegel, a Brussels-based think-tank, the unitary patent is “not likely to have any impact on innovation efforts in Europe”.

He said that “prohibitively expensive” translation costs, the “not particularly coherent” layers of national, European and unitary patent offices, and the messy compromise between member states that will see the unitary litigation court set up in Paris, London and Munich, are all shortcomings that need to be overcome if the full potential of the European patent is to be realised.

Many industries in Europe remain creative and competitive with the rest of the world, as the number of patents filed in 2012 shows. But if the emergence of Asia as the origin of a rapidly increasing number of applications is an early indication, the world economy could look very different in a few years’ time.

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