Samsung president voices concern over 'patent trolls'

China's government will curb abuses in intellectual property rights, said Tian Lipu, commissioner of the State Intellectual Property Office (SIPO) during a tour of Samsung's cell phone factory in Tianjin on Monday.

During the visit Tian heard concerns from Keun-Hee Park, Samsung's president of operations in China, who highlighted the rise of so-called "patent trolls" in China.

A patent troll has no intention of manufacturing an invention, but instead files a patent whose "only purpose is purely to earn royalties", the president said.

He noted the practice originated in the United States, but has now emerged in other countries.

Commissioner Tian said that "abuse of intellectual property rights is a worldwide issue - it goes beyond the reasonable and damages the legal interests of others".

"Since the Chinese government adopted a national intellectual property strategy in 2008, fighting such inappropriate use of patents has been listed as one of five top priorities on our agenda," he noted.

The latest patent law seeks to forestall abusive patents and strike a balance between the public interest and rights of patent holders, he said.

In addition, Park also expressed concerns over SIPO's patent processing efficiency, but Tian noted the average time needed has been shortened to around two years from five to six years a decade ago.

Efficiency is expected to further increase with a new online patient administration system that became operational in April, he added.

As a public service, SIPO is tasked with improving intellectual property protection to guarantee legitimate interests of foreign investors, Tian said.

Protection of intellectual property is a key element in an investor-friendly environment and the government has shown its "firm determination" to ensure rights, he said.

While intellectual property was seen a shared resource some 30 years ago in China, the concept has changed dramatically, Tian said.

"Yet still it takes time to spread awareness," he said.

Through continuing growth in R&D investment, Samsung now has more than 2,200 patents in China. Ninety-nine percent of its R&D staff in the country is local.

The company had $41.8 billion in revenues from its China operations in 2009. More than $30 billion came from its mainland businesses.

Intellectual property creation and management are key to the robust growth, according to the company. To further sharpen the edge, a special intellectual property team has been founded at Samsung - which is "of demonstrational significance to Chinese companies", Tian said.

The visit to Samsung headed by Tian included members from the ministries of commerce and public security as well as the Supreme People's Procuratorate. They also toured the facilities of Japanese printer maker Epson in Tianjin the same day.

It was the second time an inter-ministerial group visited multinational companies, following a first tour in late April.

The trips are designed to "learn more about foreign investors' needs directly on the spot and increase exchanges with them", Tian said.

Foreign patent applications in China surpassed 99,000 filings last year, 94.3 percent of which came from companies.

(Source: China Daily)

2010-05-13

2010-05-13