News Item
Benefits of 'Cleantech' patent protection to developing and least developed nations - new report published
14 May 2009
A new report commissioned by the European Commission considers the validity of claims that an increase in patenting activity relating to 'Green' technologies prevents the transfer of technology to developing or to the least developed nations.
The reduction of CO2 emissions has become a high-ranking public concern and is subject to binding international agreements. Particular importance is attributed to future technological improvements that may facilitate the replacement of polluting but commonplace technologies with less polluting alternatives. To maximise the benefits of newly developed technologies, however, geographically widespread adoption of worthwhile developments is desirable. Alongside increased R&D activity the number of patent applications filed for developments in the ‘Green’ technologies field has also increased considerably. Some developing nations have argued that this increase in patenting activity prevents the transfer of technology to developing or to the least developed nations.
The report considers incentives for and obstacles to transfer of technology and draws conclusions based on an analysis of patent filing numbers in a selection of emerging economies and least developed nations as well as on previous research.
Findings show that at least Western patent holders are more likely to transfer technology to other countries if such other countries have reasonably strong mechanisms for the protection of intellectual property in place, so that IP owners are more likely to be able to stop infringers. The presence of a reasonably strong IP system and the ownership of IP rights in a country thus increase the likelihood of transfer of technological developments to such countries. Strong IP protection moreover stimulates technological development, thus supporting the creation of new, less polluting products. China is cited as an example of a country in which domestic IP ownership for 'Green' technologies is high as a consequence of increased innovation.
Other key findings of the report are as follows:
- In a given area of CO2 emission reducing technologies old variants of the technology, for which IP protection has already expired, are likely to be available in developing countries. Any increase in the costs of the new (and IP protected) technology is consequently concluded to likely reflect the value added by the new technology. Additional costs may of course be offset by savings associated with the new technology, for example by a reduction in energy consumption when compared to the technology the improvement replaces.
- An analysis of patent ownership data in developing countries showed that patent ownership within an area of technology is not limited to proprietors from single countries. The report also therefore considers it likely that competition between various alternatives in each field of technology will exist, be that in the form of competition between patent proprietors from different countries or between different companies residing in the same country. Moreover, it is noted that different technologies may also compete with each other, therefore increasing competition even further.
- In least developed countries patent coverage is minimal, and as such there cannot be merit to arguments that IP protection can make less pollution technologies unaffordable in these countries. Potentially high costs of new technologies are likely to be related to the fact that many of these new technologies are not yet technologically mature enough to allow for cheap production. Such technologies may thus benefit from further innovation, which may be encouraged by IP protection.
- No evidence that IP protection could act as a barrier to technology transfer could be found. Other barriers may exist but IP protection can motivate transfer of technology that would less likely take place in the absence of a reasonably strong IP system.
For more information, view the report here.