US Chamber International IP Index: US, Europe At Top; India Needs A Push

The United States Chamber of Commerce today released its fifth annual International IP Index, which makes the case for the positive impact of intellectual property on economies. The United States scored highest, followed by top European economies and Japan. And near the bottom was India, despite recent efforts to accept the IP system. Separately, the report assesses international trade rules for IP and argues for nations to negotiate “TRIPS-plus” agreements. 

This year’s International IP Index, titled “The Roots of Innovation,” rates 45 world economies on patents, trademarks, copyright, trade secrets, enforcement, and international treaties. The economies benchmarked in the 150-page 2017 Index account for 90 percent of global gross domestic product (GDP), the Chamber said in a release.

Chamber President Tom Donohue said of the report and IP, “The conclusion is very clear: if you’ve got it you win, if you don’t, you lose.”

“We want to help India,” said Donohue, which he added would help its economy and the global economy. The report launch was webcast here.

He said the Chamber can help governments develop helpful policies, and can “enable, lobby and harass” on IP enforcement, not only through the Chamber’s Global IP Center, but other branches of the Chamber as well. He praised President Trump’s recent call for stronger enforcement of trade agreements, including IP rights.

The US slipped to fifth in enforcement of IP laws, which Donohue said will become a focus of efforts going forward.

Meir Pugatch, managing director and founder of the consulting firm Pugatch Consilium of Israel (which ranked above Canada in the report), which generally takes a positive view of IP based on its analysis of data, presented the report today.

Pugatch said he would not say that the world is opposed to intellectual property, but there needs to be more focus on data such as that he presented, which he said show the favourability of strong IP.

IP countries can be grouped in clubs, Pugatch said. At the top are the “Tom Bradys of IP,” said Pugatch, referring to the quarterback of the New England Patriots, Super Bowl winners in US football this week.

This year the report expanded the number of indicators used to rank countries from 30 to 35. The new indicators include “new areas of IP, such as design rights, as well as growing areas of concern to rights-holders including patent opposition proceedings and barriers to licensing agreements,” the report states.

Strong IP, the report found, leads to R&D expenditures, access to venture capital, access to advanced technologies, innovative outputs, access to licensed music outlets, and foreign direct investment attractiveness.

Pugatch took a shot at what he called the “Geneva scene” or “critics of IP”, who see market size or other factors as much more important, not IP. “We do not respond with words, we respond with data,” he said.

He walked through results that he said supported point-by-point the argument for stronger IP.

“Countries with strong IP environment have much more investment in clinical research. But again this is being attacked. And the list goes on and on and on,” he said.

The stronger intellectual property environment a country has, the stronger ability they have to licence, he said, arguing that this counters the believed advantages of freely accessing knowledge. “You don’t need to appropriate IP in order to have technology transfer,” he said.

Pugatch said he thinks the data shows that a stronger IP system builds stronger economies. As the report conclusion says in “flowery” language:

“In a changing global landscape, IP standards serve as the lasting, vibrant roots of innovation that will enable us to solve the world’s problems and meet future challenges. They are the standards that governments can bank on and that will allow industries to bloom.”

[Update:] The index also analyzes the 1994 World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), and finds it lacking mainly due to its age. The index makes the case for countries to go beyond TRIPS in their bilateral and regional agreements.

“It is striking that despite establishing an important level of IP protection globally, TRIPS standards still represent a rather low bar of national IP protection worldwide, especially when considering the technological developments and economic realities faced today, 20 years since its introduction,” it states. “To compete today, economies need to look beyond TRIPS to higher IP standards as roadmaps for enhancing innovation and economic growth.”

Meanwhile, the index found the recently concluded but now struggling Trans-Pacific Partnership agreement (TPP) to score much higher and more closely reflect what countries should be aiming for. But it too had some flaws and could be done better, the index said.

The full Chamber press release is reprinted below:

WASHINGTON, D.C. —  The U.S. Chamber of Commerce today released its 5th annual International IP Index, “The Roots of Innovation,” rating 45 world economies on patents, trademarks, copyright, trade secrets, enforcement, and international treaties. The economies benchmarked in the 2017 Index account for 90 percent of global gross domestic product (GDP). “Just as a tree cannot grow without roots, innovation cannot thrive without intellectual property,” said David Hirschmann, president and CEO of GIPC. “In the 2017 International IP Index, we provide both an IP report card for the world and a guidebook for policymakers seeking to bolster economic growth and innovation. “This year’s Index shows that a clear pack of leaders has emerged: the United States, United Kingdom, Japan, and the European Union. But all that invest in the systemic recognition and protection of IP stand to reap the benefits: foreign investments, healthier home-grown industries that export innovative products, and a reputation as a place where the world can do business. From the most developed countries to the least, countries that demonstrate a commitment to IP will reap a reward.” “Governments from East to West all want the same thing: economic growth. Now more than ever, world economies must choose whether they will grow forward into the future or shrink back from endless innovative potential,” said Mark Elliot, executive vice president of GIPC. “Each year, this report attempts to highlight best practices among the world’s intellectual property environments. In 2017, many of the same challenges remain. Emerging markets, such as India, have made incremental gains and embraced positive rhetoric with their IPR policies, but they have not yet followed up with the legislative reforms innovators need. Some developed countries, including Canada and Australia, continue to implement policies that undermine their proud traditions of IP-led innovation. And even world leaders such as the U.S. have room to grow and improve.” The Index ranks the IP systems in Algeria, Argentina, Australia, Brazil, Brunei, Canada, Chile, China, Colombia, Ecuador, Egypt, France, Germany, Hungary, India, Indonesia, Israel, Italy, Japan, Kenya,  Malaysia, Mexico, New Zealand, Nigeria, Pakistan, Peru, Philippines, Poland, Russia, Saudi Arabia, Singapore, South Africa, South Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey, Ukraine, United Arab Emirates, United Kingdom, United States, Venezuela, and Vietnam. The full Index can be viewed at www.theglobalIPcenter/ipindex2017.