Zhongguancun in western Beijing is not only a national technology hub, but also a growing center for innovation and a model area in patent protection and utilization.

As long as a decade ago, the central government nominated the area as a national demonstration zone for intellectual property. The administration of Zhongguancun has since enjoyed a close partnership with the intellectual property office at the Beijing municipal government.

The administration has now set up a fund to encourage patents. Companies or institutions receive a cash awards for each domestically granted patent, plus a bonus for each one approved overseas through the Patent Cooperation Treaty. Excellent patent agencies also receive funding.

There are some 300 patent agencies in Beijing, about half of the entire nation's total, but "when it turns to capacity, more than 80 percent of the competitive agencies in China are based in Beijing", said an administration official for Zhongguancun.

Companies in Zhongguancun filed just 228 patent applications in 1996, but the number soared to 21,866 last year. Over the same period, the number of granted patents increased from 83 in 1996 to 12,578.

In recent years, much of the administration's intellectual property work has revolved around large and leading companies. By offering guidance and encouragement, it helps them increase their market competence and set a good example for other local companies.

For smaller firms and startups that often focus more on marketing and R&D than on intellectual property management, the administration encourages agencies to help them improve IP awareness.

The authority itself is innovating in its efforts to "commercialize and utilize" patents. One initiative is Beijing Intellectual Property Operations Management Co Ltd established in May to facilitate management and financing using patents as collateral.

Three years before, the China Technology Exchange was founded in Zhongguancun to seek more efficient ways of commercializing technology.

The exchange has introduced patent trading modeled on the commodities market. One of its most successful innovations is a technology patent auction held since 2010 that allows many technologies a time to be "wholesaled".

Its third patent auction, which lasted for four months and closed in December, attracted more than 40 potential buyers. More than 230 patents were auctioned including rights to Internet applications, integrated circuit designs and video processing.

Eighty-seven of the patents were sold a combined value of more than 4 million yuan ($641,200). The most expensive single deal was worth 2 million yuan.

Li Xinjun, director assistant of the Intellectual Service Center at the CTEX, said the focus has shifted to "increasing the quality of patents and not the number".

CTEX also organizes training programs for senior executives and intellectual property personnel in Zhongguancun to improve their knowledge and increase awareness of intellectual property rights.

The Zhongguancun Intellectual Property Promotion Office led by the State Intellectual Property Office and the administration committee has introduced a circuit examination panel that meets patent applicants face-to-face.

"Traditionally, patent examiners only receive applications and examine the cases based on their own understanding," explained Fan Rui, director of the information center of the promotion office. "Sometimes the examiners' lack of professional knowledge could lead to misunderstandings and the examination might be delayed."

But the circuit examination model bridges the two sides, "offering the applicants a better opportunity to explain their solutions or ideas".

The most recent initiative by the promotion office is a patent insurance system in partnership with leading insurer PICC.

It provides compensation "before rulings come out from the court to an insured company whose patent right is infringed on ", said Fan.

Zhongguancun is believed to be among the most qualified high-tech zones nationwide to develop the intellectual property industry, said its administration officials. It began research earlier this year to find the right combination of policies, talent and systems for patent management and utilization.

"For a market-oriented and internationalized company, intellectual property is a necessary weapon," said an official from the innovation promotion department. "Only in monopolized sectors - where there is little competition and little possibility to go to the world market - does intellectual property seem less important."

The administration at Zhongguancun "respects market rules and corporate development and does not intervene in a company's operation", but "offers services when companies need them", said the official.

(Source: China Daily)