WIPO: Patents, Trademarks Tied To Economic Cycles But Crisis Impact Uneven

World Intellectual Property Organization Director General Francis Gurry was accompanied publicly for the first time by the United Nations agency’s first economist as they presented data Friday showing the positive correlation between patent applications and economic cycles.

“Growth rates correspond to economic cycles,” Gurry told a press conference. “In economic crises, there is an interference in the value cycle.” Investment in innovation can go down as profits decline, and fewer patent applications are filed.

But he said in a statement that in the past, “companies and countries which continue to invest in new products and innovation during times of economic recession will be those that will be best positioned to take advantage of the recovery, when it arrives.”

The statistics were presented in WIPO’s 2009 World Intellectual Property Indicators report, formerly its annual patent report. The report shows the latest statistics for patents, trademarks and industrial design.

Gurry noted that a difference can exist between national and international patenting behaviour. For instance, in the first six months of this year, Japan and the United Kingdom saw downturns of more than 10 percent in domestic patent filings, but increases of 11 percent and 6 percent, respectively, in international filings at the WIPO-managed Patent Cooperation Treaty (PCT). The PCT allows paperwork filed at the national level to be extended to other countries.

The impact of the economic crisis which hit hardest in 2008 has been different across the world, Gurry said. For instance, PCT applications so far this year are down some 14 percent from the United States and up 19 percent from China, though there are other factors at play.

Overall, PCT applications are expected to be down some 5 percent this year, Gurry said. PCT fees are a substantive contributor to WIPO’s revenues.

Meanwhile, the global backlog of unprocessed patent applications is “shocking” – in the millions, he said. One thing being done to address it is experimentation around the world in work-sharing among national patent offices. The Patent Prosecution Highway is a series of bilateral arrangements in which a second office accepts certain work from the first. WIPO is exploring how work product from the PCT might be used in these arrangements, Gurry said.

“We would like to see all of these experiments multilateralised in the PCT,” Gurry said.

The report showed that up until the financial crisis of 2008, patent and trademark filing were still on the rise. According to the report, residents of the United States and Japan owned nearly half (47 percent) of all patents in force in the world in 2007.

Statistics show that about 63 percent of patents in force in 2007 were filed between 1997 and 2004, with only a “small minority” maintained for the full term of 20 years, the standard life of a patent.

On “green” patents on environmental technology, Gurry said it would still be a few years before the impact of increased investment in recent years would show.

Separately, he said there is a suggestion that intellectual property rights litigation is on the rise, which seems counterintuitive at a time when company resources are limited.

And in the case of copyrights in the global crisis, Gurry called the situation “more complicated,” as Hollywood is returning to record box office returns.

Also, WIPO announced that it will start its annual General Assemblies, being held from 22 September to 1 October, with a two-day high-level ministerial meeting. The assemblies are the annual highest-level gathering of the WIPO member countries, of which there are currently 184. More than 40 ministers are expected and will focus on IP challenges confronting senior policymakers, WIPO said in a release.

WIPO’s first chief economist, Carsten Fink, joined the organisation about a month ago.