China: 99% Firms Fail to Apply for Patents

Asian Textile Business, 2006

"Made in China" indicates its presence in the global market; however, a survey by the State Intellectual Property Bureau has revealed that 99% of firms with proprietary technologies eligible for patents have not completed the application for domestic patents, let alone international patent

Many firms lack a working knowledge of intellectual property rights. The result is the failure to cope with troubles concerning intellectual property rights and uncertainty about ability to participate in global competition on the part of many firms.

According to statistics issued by the State Intellectual Property Bureau, as of the end of 2005, the ratio of firms holding their own technologies eligible for intellectual property rights was three ten-thousandths of the total. Of this total, 99% of firms had not applied for patents and 60% of firms do not own their own trade mark rights.

According to a random check at the Canton Fair, 50% of Chinese firms' export products are products under OEM (original equipment manufacturer) deals. 20% unbranded products. 21% are original brands. The inspection revealed that as many as 80% of firms are exporting products under OEM deals or unbranded products.

Presently, the high-value added portion such as the development of design and brand management is virtually under the influence of industrial interrelationships under way on a global scale.