How China Will Fundamentally Change the Global IP System

By Rob Sterne
July 24, 2019

“The Chinese have the people, money, plan, market size, and determination to change the global IP system fundamentally in the next 5 years. Those who do not agree are living in the past!”

How China Will Fundamentally Change the Global IP System

Currently, the massive volume of filings at the Chinese Patent Office (CNIPA) exceeds the filings of the next four most active patent offices combined. It portends a rapid shift to Chinese language prior art being the repository of technical teachings around leading edge technologies for the Fourth Industrial Revolution. This will happen for several reasons and much more rapidly than many believe possible. But first, a little technological history.

Chinese artisans invented papermaking during the Han dynasty, as early as 179 BCE. This highly important technical advance was essential for the civil service to document, direct, and transfer written knowledge across a large geographical region with a growing population. Paper made it possible for the government to run the country and for the accumulation of vast amounts of information that could be disseminated far and wide at relatively low cost and easy accessibility.

This paper technology was radically different from the papyrus used by the Egyptians or animal skins used in other areas around the world. Through various trade routes and conflicts, the innovation slowly diffused to Islamic regions in the Middle East and North Africa and then to Europe which aided in facilitating the Renaissance. Without paper, the modern world would not be the same today.

The Chinese are making a similar impact on prior art that is rapidly changing the global IP landscape. As discussed in prior editions of FOCUS, the Chinese government is encouraging a rapid increase in patent applications at the Chinese Patent Office using economic and other incentives (particularly for China-based inventors). Already the filings at the Chinese Patent Office on a yearly basis exceed the cumulative filings at the USPTO, EPO, JPO, and KIPO – a staggering statistic. The volume of applications filed at the CNIPA increased ten-fold in just 13 years.  In the same period of time, filings at the USPTO increased by just 1.7X.

Some argue that the quality of these filings is low and that many cover what is already in the global public domain. Even assuming this is correct (which one should not blindly accept), these Chinese filings constitute a massive trove of global prior art, which by its sheer numbers will dominate the global prior art library in a few years.

This massive prior art collection is being built at the same time the Chinese are pushing rapidly forward with their Belt and Road initiative, linking China with Europe through Asia and Africa. Coupled with massive Chinese investment in infrastructure and loans to the many countries along these trade routes, the Chinese prior art collection will come to dominate decisions on patentability in these countries as a natural outgrowth of this dissemination of technological information. While this dissemination will be greatly facilitated by electronic communications instead of physical documents, the use of Chinese as the language of disclosure will further erode the importance of the prior art libraries found in the US, EU, UK, Japan, and South Korea.

China has adopted an expansive definition of what constitutes patent-eligible subject matter, which may even be broader than the definitions in the EPO, JPO, and KIPO. Of course, with the current statutory subject matter morass that exists in the US, this puts China at the forefront of encouraging patent filings on leading edge technologies. Many of these technologies are those listed in the country’s current 5-year plan. Moreover, there are credible reports that the Chinese government applies a heavy hand on non-Chinese companies forcing disclosure of the trade secrets used when operating in China. Thus, by both encouraging and coercing patent filings at the expense of trade secrets, the Chinese create an even greater incentive to expand their prior art library so that it becomes the most extensive prior art collection in the world.

Another significant development is the language barrier to non-Chinese speakers. The Chinese prior art library forces mastery of the language used to gain access to these teachings. While the USPTO, EPO, JPO, and KIPO are trying to deal with this information barrier using machine translation and human translators, the explosion of prior art makes it ever more difficult. All innovators and their IP professionals need to confront this language barrier now, or be left in the dark about the global prior art landscape.

The Chinese have the people, money, plan, market size, and determination to change the global IP system fundamentally in the next 5 years. Those who do not agree are living in the past! History teaches that technological change occurs in the locales that encourage learning and provide the resources that allow innovators to build on the disclosed knowledge of those who have come before. This is why the Chinese prior art library is so potent and why it facilitates the Belt and Road initiative among other Chinese global initiatives.

To quote Sir Isaac Newton: “If I have seen further than others, it is by standing upon the shoulders of giants.” The Chinese prior art library may well be these shoulders in the years to come.

The Author

Rob Sterne

Rob Sterne is a founding director of Sterne Kessler Goldstein & Fox. At the age of 26, and just one year out of law school, he set out to create a different kind of law firm—one that recognized the contributions of all its members and put a strong emphasis on scientific and technical knowledge. Now, nearly four decades later, Sterne has helped to nurture and grow this revolutionary idea into one of the top five largest intellectual property specialty firms in the country. And in so doing, he has established his place as one of the leading patent lawyers in the United States. In fact, Rob has been recognized by the Financial Times as one of the "Top Ten Most Innovative Lawyers in North America 2015," by Law360 as one of the "Top 25 Icons of IP," and among the country’s "IP Trailblazers & Pioneers 2014" by the National Law Journal. He is highly respected by his peers and has received some of the most prestigious awards and rankings for professional excellence in intellectual property law.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 19 Comments comments. Join the discussion.

  1. Benny July 25, 2019 5:19 am

    “…these Chinese filings constitute a massive trove of global prior art…”

    In theory, this could massively improve the quality of US patent examination. In practice, I have only once seen a Chinese publication cited against a US application, and that was a third party submission filed with a translation.

  2. Night Writer July 25, 2019 8:17 am

    What I’ve seen a bunch of times recently is priority dates going back to a Chinese application that is only in Chinese and then a US application claiming priority to the Chinese application. Sometimes in PCT and national stage form with the PCT claiming priority to Chinese applications.

    The problem is that often the art is not accessible to me easily or that it is difficult to translate. I’ve learned some tricks, though. But what I’ve found in the standards industry is that often there is new matter that is claimed as being disclosed in original Chinese applications but isn’t.

  3. zoobab July 25, 2019 9:14 am

    “it is by standing upon the shoulders of giants”

    With software patents, no small software company can stand on the shoulder of giants anymore.

  4. zoobab July 25, 2019 9:16 am

    And China can flood its market with patent trolls, as long at they stay within their borders.

    At least the damage is limited to their country.

  5. TFCFM July 25, 2019 10:46 am

    Given that much of Chinese IP filings are rumored to be driven by government subsidies paid for IP filings (in China and abroad), there appear to be serious reasons to be skeptical that the subsidized filings will be rich on new technical material.

    The greater danger, it seems to me, is the risk of “creative” translations of Chinese-language documents in the context of IP challenges. It would not surprise me in the least to discover that the translation of a Chinese prior art document gets shaded, owing to the creativity of the translator, to resemble IP targeted by folks challenging the IP. How many IP challenges will turn into a “Battle of the Translators” decided by juries which do not speak Mandarin? I hope we don’t find out.

  6. S. L. Hou July 25, 2019 1:01 pm

    Interesting observation. Who & where are going to judge the prior art issue?

  7. Ternary July 25, 2019 5:51 pm

    “History teaches that technological change occurs in the locales that encourage learning and provide the resources that allow innovators to build on the disclosed knowledge of those who have come before.”

    David Wootton in his book “the Invention of Science” calls it the “concept of discovery.” It is a cultural aspect that has served Western culture and economy well. The freedom to discover has been alive in our culture for over 500 years. We are not more advanced because we are smarter or better educated than in other cultures. Rather, we allow people to disagree with mainstream ideas. This disagreement generally had an intellectual basis, not always an economic one. The Ottoman Empire, China, Japan, India, Russia all had or have very smart engineers and scientists.

    So far, most of breakthrough science and technology has Western origins and/or realization. Science based innovation goes beyond planned engineering and education, as Japan has demonstrated.

    While I find the growth of technology in China (including IP filings) very impressive, I have not seen any breakthrough science coming from that country. The country is controlled by a bunch of ideologists who cannot make up their mind if they are capitalists or communists or just plain corrupt. They appear to have one overriding interest: stay in power. That is not a culture/atmosphere wherein new scientific ideas will develop or thrive.

    Before turning to China, I would rather see a fight for our own open culture and against dominance of ideological influence on our science and technology. Clearly, our open culture is under attack, for different converging political and economic reasons. The state of our patent system is a symptom of that. But we are able to identify and discuss these issues. Something that may not be possible in China.

  8. Mark Cohen July 26, 2019 3:05 pm

    I don’t think the issue should be so limited to looking at Chinese patent filings. Thus far we are seeing relatively low forward citation data in many Chinese patents, and to judge from academic literature, the forward citations are likely to be to the inventors themselves. China has already flooded the world with academic literature which for the most part is in English, but also has the same qualitative concerns. My concerns are around state management of IP, low patent quality, impacts on standardization, Chinese perceptions that quantity may equal quality in its court system (see Huawei v. Samsung in Shenzhen which looked to Chinese filings only as an indicator of quality) etc. Certainly we will see more references to Chinese prior art. We will also see better and better machine translation and hopefully China will begin sometime to examine the flood of utility models that it does not examine. What we may not see is China pulling back on state interventions in IP markets.

  9. michael waldraff July 27, 2019 5:36 pm

    didn”t the chinese buy the early U.S. patents a few years ago. if so why was this allowed to happen?

  10. Gene Quinn July 28, 2019 9:51 am

    Michael-

    It wasn’t the patents, it was the models— even worse. They are using them to promote inventorship among the people. A genius idea that WE should be doing. You ask an excellent question.

  11. Frank Beck July 29, 2019 8:51 am

    …Another significant development is the language barrier to non-Chinese speakers…
    Just one more reason to speed-up machine translation development to become more reliable.

  12. Benny July 29, 2019 10:33 am

    Frank,
    Machine translation algorithms are abstract and ineligible under 101. Anyone who knows 2 languages can translate as a thought process, instructing a generic computer to do the same task won’t make it past the examiner. There goes your incentive to speed up machine translation. (!)
    There is another impediment, though. Google has more or less cornered the market on machine translation and it is improving all the time (have you tried their live translation using your phone camera?)

  13. Night Writer July 29, 2019 3:39 pm

    Benny >>>Machine translation algorithms are abstract and ineligible under 101. Anyone who knows 2 languages can translate as a thought process, instructing a generic computer to do the same task won’t make it past the examiner.

    You have just forever destroyed your credibility. “instructing a generic computer to do the same task won’t make it past the examiner.” Do you write things like that because you believe them?

  14. michael waldraff July 29, 2019 3:51 pm

    thank for the answer Gene, and thank you for all you do.do these models qualify as prior art?

  15. Benny July 30, 2019 1:38 am

    Night Writer, meet my friend Sarcasm. Sarcasm, meet Night Writer. You two have a lot of catching up to do. (The exclamation mark was a dead give away, yet you managed to miss it).

  16. angry dude July 31, 2019 12:20 pm

    Gene Quinn @10

    “To promote inventorship among the people” one only needs to follow up with what’s written on the face of each and every US patent” “to exclude others from making, using or selling the invention.. ” (for a limited period of time, of course)

    That is all. Nothing else is needed.

  17. Anon July 31, 2019 3:38 pm

    (The exclamation mark was a dead give away, yet you managed to miss it).

    May I suggest that such is NOT a “universally recognized translation”….?

    This site does not accept emoticons, so the old stand by of ” 😉 ” (winking smile) might be a better indicator of intended sarcasm.

    For what it is worth, Benny, I did NOT take your earlier post as any type of intended sarcasm. MOST ALL of your posts – sounding as they do in the mantra of the Efficient Infringers – are NOT distinguishable from what you now claim to have been intended sarcasm. It is NOT Night Writer that has a lot of catching up to do.

  18. Anon July 31, 2019 5:32 pm

    The emoticon DOES “auto-populate.” My bad.

    To get there type the following in direct sequence:
    ;

    )

  19. Jeff L. August 1, 2019 12:23 pm

    Ternary wrote: “The country is controlled by a bunch of ideologists who cannot make up their mind if they are capitalists or communists or just plain corrupt. They appear to have one overriding interest: stay in power. That is not a culture/atmosphere wherein new scientific ideas will develop or thrive.”

    There are tensions between the need for strong IP and vibrant economic growth (both of which require a healthy degree of freedom) and the need for political stability, but the same tensions exist in the US (at a deeper level than just which party appears to be in charge). But China is a place where science is thriving a rapid advances are occurring in areas such as nanotech, pharma, IT, etc. Many huge advances. With the weakened IP system in the US, it will be hard for us to keep up.

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