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China's Intellectual Property System Should Focus on Backing Up Re-innovation


By Chen Xiaohong & Wang Huaiyu, Research Team on "Study of Government-Enterprise Relations for Strategic Emerging Industries", the Enterprise Research Institute, the DRC

This paper first points out that China's intellectual property (IP) system should focus on backing up re-innovation by Chinese enterprises. Then it discusses how, through co-operation between the government and enterprises in improving the IP system, the government could back up re-innovation by enterprises.

I. Priority Task of the Intellectual Property Strategy of China Is to Back Up Re-innovation

The Outline for China's Strategy of Intellectual Property (abbreviated to Outline), the first one of its kind promulgated in June 2008 by the State Council, has depicted the status quo of China's system of intellectual property and its application and put forward the guidelines, strategic targets and priorities laid down in China's strategy of intellectual property and relevant special tasks and strategic measures. The promulgated Outline and the revised Law on Intellectual Property are an important contribution to the formation of China's strategy of intellectual property and to the enhancement of related systems in the new century.

Much has been achieved by China from the formulation of the Outline for the first time. However, since China's system of intellectual property has come into being for a short period of time and relevant research has been inadequate, it is thus unavoidable for some problems to remain unsolved. One of the key problems is that as both possession and utilization of independent intellectual property are inferior in China, people had to find out what kind of intellectual property system can help improve this inferiority. This question caused much concern when the strategy was being formulated.

While emphasizing international rules, the Outline also holds that "policies and measures related to intellectual property in line with national conditions should be adopted vigorously to boost national development". In terms of national condition, except for the emphasis on the protection of intellectual property rights in special areas, other conspicuous measure and methods have not been laid down in the Outline It is attributable to the less and unclear discussion over the status quo and strategis of the then Chinese enterprises or technical innovation and also due to the less understanding of the selectable plans for strategies and system of intellectual property under different technical innovation strategies. Without discussion over technical innovation served by the system of intellectual property, it will become naturally difficult to discuss related targets and orientations. Even if targets and orientations are set forth, without definite and clear solutions to the problems, it will still be hard to have a common understanding of the targets and strategies and policy decisions on readjustment of the system.

We are of the opinion that we must enhance the system of intellectual property based on the guiding ideology conducive to "re-innovation" in order to increase independent intellectual property in China. Formation of the strategy or system of intellectual property is relatively independent and, if China's commitment made at its accession to WTO is a restrictive term, this formation must be in line with China's national conditions, and especially conform to and coordinate with the status quo an strategy of technical innovations (or inventions) by Chinese enterprises. For Chinese enterprises, technical innovation strategies and significant technical innovation strategies in particular are original or originals with secondary-innovation. Right now, those innovations are mainly re-innovation or secondary-innovation. Over a rather long period of time ahead, such as 20 or even 30 years in the future, re-innovation will take the lead. Innovation is a commercial success based on new knowledge. Re-innovation or secondary-innovation is based on the invention or technical source of others, which is known as the enhanced innovation (including major enhanced innovations). Integrated innovation is a kind of re-innovation derived from inventions by others. The judgment is based on researches of corporate and innovations currently conducted by Chinese enterprises are mainly secondary innovation or re-innovation and that the secondary-innovation, in the context of the globalized manufacturing industry, will remain the immediate choice for the improvement of technologies for China's manufacturing industry over a long period of time. Ryutaro Komiya, a renowned Japanese economist, wrote a paper in 1999 holding that up to the 1990s important industrial innovations carried out in Japan were enhanced innovations in the main. The Outline for Japanese Strategy of Intellectual Property 2007 promulgated in the same year also frankly imported basic technologies from USA and European countries and has improved the technologies and used perfect capabilities to make necessary enhancement of the production sites". Even among seven categories of strategic rising industries listed by China and to be developed in 23 direction, most are industries with technologies from developed countries and are even successfully commercialized, with a few number of industrial technologies remaining unripe, but foreign countries are mostly taking the lead over China in terms of relevant technical invention and patent. It is unnecessary to go into details about the significance of re-innovation to business innovation and technological progress in China. What needs to be pointed out is that, not only in China, but even in developed countries such as USA, most successful innovations are re-innovation. Only that technical re-innovation is of extraordinarily significant strategic importance to China's innovations at its present development stage and in light of China's national conditions.

We can make a judgment of the orientation for the improvement of the system of intellectual property on the basis of defining the basic features and strategies of technical innovation: We should not only strengthen the protection of intellectual property of superior objects and should all the better pay special attention to the encouragement and support from the system of intellectual property to re-innovation. As re-innovation is related to a wider range of industries as well as technological progress in industries needing continuous and integrated innovation, strengthening motivation, support and application of re-innovation should be an important research topic for China's strategy of intellectual property and be an important orientation for the readjustment of China's system of intellectual property. Strengthening motivation and protection of re-innovation is not denying the protection of original innovation (or invention) but is laying special emphasis on motivating the re-inventor (technical inventor) when balancing the rights and interests between original innovators and enhancement innovation. The United States' system of intellectual property is inclined towards original innovators (technical inventers) and the Japanese system is relatively more inclined towards enhancement innovators. There are already some rules and regulations conducive to re-innovation in the Patent Law already in force now in China. Only because we have not fully recognized the significance of those rules and regulations giving impetus to re-innovation, the interrelations between the rules and regulations and the methods of application, we have not brought their value into full play. Due to limited space, this paper will not deal with the relations between original invention and re-invention in detail, but still wants to point out that paying attention to re-invention or secondary-innovation, as shown by Japanese experience, will not impair the original innovations and inventions made by enterprises on the whole.

II. Five Options to support and Encourage Re-innovation

Stressing that the system of intellectual property (including coordination with relevant systems) should support and protect re-innovation is virtually stressing that the designing of the system should conform to the reality and need for technical innovation among Chinese enterprises. We should guard against and restrict enterprises of developed countries from "abusing their advantages" by capitalizing on their forward inventions and intellectual property to hamper Chinese enterprises from developing and innovating continuously with their subsequent advantages. e insurance, culture, road construction, human and animal drinking water and energy. Since the 16th CPC National Congress, governments at all levels have increased inputs in rural infrastructures and social undertakings. Rural infrastructure construction has witnessed an unprecedented scale and intensity, and rural social undertakings have been developing rapidly.


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