Introduction: The China National Intellectual Property Administration(CNIPA), China’s top IP regulator, recently released on its website the "2023 China Patent Survey Report", which underscores the evolving landscape of patent utilization, collaboration, protection, and talent development in China, reflecting the country's commitment to fostering innovation and strengthening its position in the global IP landscape.
The 2023 China Patent Survey Report revealed that by the end of 2022, China possessed a significant number of valid patents, marking a notable increase from the previous year. Among these were 3.351 million invention patents（excluding Hong Kong, Macao and Taiwan), reflecting a year-on-year 20.9% rise, along with 10.781 million utility model patents and 2.708 million design patents, demonstrating increases of 17.3% and 10.4%, respectively.
The survey targeted patentees with valid patents as of the end of 2022, distributing 18,000 patentee questionnaires and 50,000 patent questionnaires, with response rates of 83.6% and 80.5%, respectively. Below are the key findings:
I. The effectiveness of patent transformation and application in China has further improved, with notable advancements observed in the industrialization rate and associated benefits.
According to the 2023 Survey, China saw increased patent industrialization rates compared to the previous year, with steady growth in the industrialization benefits of invention patents. The industrialization rate of invention patents for small and micro enterprises has shifted from decline to increase.
Firstly, China's patent industrialization rates have surged. In 2023, the industrialization rate of invention patents reached 39.6%, marking a 2.9% uptick from the previous year, maintaining steady growth for five consecutive years. The industrialization rate of utility model patents soared to 57.1%, up by 12.2% from the previous year, signifying a notable increase following negative growth in the previous period. Design patents saw an industrialization rate of 66.0%, climbing by 7.3% from the previous year.
Secondly, the industrialization rate of enterprise invention patents has surpassed 50% for the first time. In 2023, China achieved an industrialization rate of 51.3% for enterprise invention patents, marking a 3.2% increase from the previous year. Looking by enterprise size, the industrialization rates of invention patents for large, medium, small, and micro enterprises were 51.0%, 57.9%, 53.9%, and 33.8% respectively. The industrialization rates of invention patents for small and micro enterprises have halted decline, witnessing increases of 8.6% and 11.8% respectively from the previous year.
Thirdly, the industrialization benefits of enterprise invention patents have continued to rise. In 2023, the average benefit per industrialized invention patent for enterprises in China stood at 8.296 million yuan, marking a 3.8% increase from the previous year's average of 7.992 million yuan per patent. Notably, the average benefit of industrialized invention patents utilized for independent brand products reached 10.671 million yuan per patent, more than double the average benefit of those used for OEM products, which was 4.621 million yuan per patent. This underscores the broader application benefits of patents and brands combined.
Fourthly, advancing patent industrialization necessitates greater backing from high-end professional talent. In 2023, 55.2% of enterprise patentees identified the scarcity of high-end professionals as the primary hurdle impeding patent industrialization, marking a 6.5% increase from the previous year. Additionally, 52.3% of enterprises expressed the need for enhanced policy support in training and attracting high-end intellectual property professionals, with the pharmaceutical manufacturing and automotive manufacturing sectors exhibiting the highest proportions at 65.3% and 61.4%, respectively.
II. Collaboration among industry, academia, and research institutions has amplified the efficacy of patent transformation, yielding increased economic gains for enterprises.
Statistics suggest that by the end of 2022, there were a total of 126,000 domestic (excluding Hong Kong, Macao, and Taiwan) industry-academia-research invention patents in China, representing an 11.5% increase from the previous year. Among these, 79,000 were industry-academia-research invention patents where enterprises were the initial patent holders, marking a 9.4% increase from the previous year. The survey findings suggest that there was considerable research and development investment in industry-academia-research collaborations, particularly focusing on achieving breakthroughs in core technologies, thus leading to enhanced economic benefits for enterprises.
Firstly, research and development investment in industry-academia-research invention patents is relatively substantial. In terms of the research and development cycle, 75.5% of industry-academia-research invention patents required over one year for development, marking a 16.4% increase compared to other invention patents, which stood at 59.1%. Regarding research and development expenditure, 16.4% of industry-academia-research invention patents exceeded 1 million yuan in investment, a 4.0% increase compared to other invention patents, which amounted to 12.4%.
Secondly, industry-academia-research collaboration places a strong emphasis on achieving breakthroughs in core technology. A considerable 65.2% of enterprises involved in such collaborations conduct basic research, marking a notable 24.6% increase compared to other enterprises. Moreover, the highest proportion of enterprises, accounting for 56.1%, engage in industry-academia-research collaboration specifically for core technology breakthroughs, underscoring the pivotal role played by such collaborations in advancing core technological innovations.
Thirdly, invention patents through collaboration between industry, academia, and research institutions significantly boost economic returns for enterprises. In 2023, China witnessed a 39.7% industrialization rate of such collaborative invention patents, with a notable 47.8% rate observed when enterprises were the first patent holders. On average, industrialized industry-academia-research invention patents yielded 10.332 million yuan per patent for enterprises, marking a 24.5% increase compared to the average benefit of 8.296 million yuan per patent for industrialized enterprise invention patents.
III. China's rate of patent infringement has reached historically low level, with strengthening awareness among patent holders to protect their rights.
The survey indicates that the rate of patent infringement among holders in China remained relatively low. However, there was a significant increase in the proportion of enterprises taking measures to protect their rights after encountering infringement, reaching a historic high. This trend suggests a growing acknowledgment of China's efforts in intellectual property protection.
Firstly, the proportion of patent holders encountering patent infringement in China is relatively low. The survey showed that the proportion of patent holders in China who had experienced patent infringement was 6.7%, a decrease of one percent from the previous year. Comparatively, during the "13th Five-Year Plan" period, this proportion consistently remained above 10%, and during the "14th Five-Year Plan" period, it remained below 8%, indicating a continuous improvement in China's intellectual property protection.
Secondly, a significant majority of enterprises, exceeding 80%, actively pursue protection of their rights upon encountering patent infringement. In 2023, Chinese enterprises demonstrated this trend, with 83.1% engaging in protective measures, marking a 10.4% surge from the preceding year. Among these measures, there was an increase in the proportion of enterprises opting for independent negotiations with the infringing party (40.4%), issuing cease-and-desist letters (38.8%), initiating lawsuits (35.0%), and seeking administrative actions (18.9%) compared to the previous year.
Thirdly, the proportion of patent infringement cases with high compensation amounts has increased. In 2023, among patent infringement cases involving enterprises in China, 8.4% of cases concluded with courts awarding, mediating, or settling amounts exceeding 5 million yuan. This marks a 1.4% increase from the previous year, maintaining a level above 7% for three consecutive years. Contrasted with the "13th Five-Year Plan" period, where this proportion stood at a mere 3.1%, it underscores a significant surge in high-compensation patent infringement cases during the "14th Five-Year Plan" period.
Fourthly, there is a growing acknowledgment among patent holders regarding the efficacy of intellectual property protection. In 2023, 29.9% of patent holders perceived China's intellectual property protection efforts as relatively adequate, marking an uptick of 6.3% from 2019 (23.6%). Conversely, the proportion of patent holders advocating for significant or gradual reinforcement of China's intellectual property protection measures decreased to 69.3%, showing a decline of 3.8 % from 2019 (73.1%).
IV. Chinese enterprises still exhibit relatively weak international competitiveness in patents, highlighting the imperative to enhance risk prevention awareness further.
The survey findings underscore the imperative for Chinese enterprises to bolster the quality of their patents as they expand globally and confront a rising tide of overseas intellectual property disputes. Nevertheless, these enterprises are proactively adapting to shifts in the international economic and trade landscape by intensifying their innovation endeavors.
Firstly, the proportion of enterprises venturing into overseas patent deployment significantly lags behind those exporting products. While 25.2% of enterprises export products abroad, a mere 5.9% have pursued overseas patent applications (including through PCT). The ratios for large, medium, small, and micro enterprises exporting products surpass their counterparts submitting patents overseas by 1.6 times, 4.1 times, 4.7 times, and 4.8 times, respectively.
Secondly, there's a tendency among enterprises to import more patent technologies than they export. In 2023, among surveyed patent-holding enterprises, 2.5% utilized overseas patents, nearly three times higher than those licensing or transferring patents abroad (0.8%). Specifically, large enterprises showcased higher utilization of overseas patents (6.5%) compared to licensing or transferring patents externally (2.0%).
Thirdly, the incidence of enterprises grappling with overseas intellectual property disputes has risen. In 2023, 2.4% of surveyed patent-holding enterprises encountered such disputes, marking a 0.4% increase from the previous year. Among these, large enterprises faced the highest proportion, at 7.4%. Predominantly, litigation constituted 63.7% of overseas intellectual property disputes, while trade investigations affected 19.1% of enterprises.
Fourthly, enterprises are escalating research and development (R&D) investments to navigate international economic and trade competition. In 2023, 9.7% of surveyed patent-holding enterprises encountered "difficulties in technology introduction" during the patent introduction process, witnessing a 7.4% surge from the prior year. Responding to international economic and trade pressures, 74.9% of impacted enterprises augmented R&D investments, while 54.4% fortified compliance measures. Overall, in confronting international economic and trade dynamics, Chinese enterprises are actively ramping up R&D endeavors, striving for autonomy in core technology control.
V. IP workforce within enterprises continues to expand, driven by a rising demand for top-tier talent and a broadening scope of services.
The survey underscores that more than ninety percent of Chinese enterprises have both full-time and part-time IP management personnel. This trend reflects a growing demand for IP management talents across enterprises, with an increasing call for high-level expertise and a range of specialized services.
Firstly, over 90% of enterprises employing IP management personnel. Among enterprises holding patents, 61.3% have dedicated full-time IP management personnel, while 78.3% engage part-time IP managers. Merely 8.6% of patent-holding enterprises lack either full-time or part-time IP management personnel. On average, enterprises with full-time IP management staff boast 1.5 professionals per entity.
Secondly, there's significant potential for the expansion of IP management teams. In 2023, 26.9% of patent-holding enterprises intend to bolster their IP management personnel, a figure substantially surpassing the 2.0% planning reductions. Industries such as electrical machinery and equipment manufacturing, pharmaceuticals, and automotive manufacturing exhibit relatively high proportions of companies (35.7%, 34.4%, and 32.8% respectively) aiming to augment their IP management teams.
Thirdly, enterprises express a diverse demand for IP professionals and services. Among those perceiving deficiencies in domestic IP services, 51.1% seek elevated expertise and services in patent exploration and application. Furthermore, over 30% of enterprises voice a need for advanced professionals and services in conducting pre-development infringement risk assessments, initiating infringement proceedings, patent maintenance and classification, and addressing patent infringement disputes.
