Chinese companies lose $1 bln over IPR disputes since WTO entry

China is facing "a grim situation" in protecting its own intellectual property rights (IPR), despite remarkable achievements in the past few years, China's Minister of Science and Technology Xu Guanhua said on Thursday.

Since China's entry into the WTO in 2001, Chinese companies have lost more than 1 billion U.S. dollars in disputes over just who own IPR on certain products. There have been IPR disputes involving DVDs, televisions, digital cameras, cars, MP3 chips, and motorcycles, Xu said.

"Some disputes constitute a devastating blow to certain industrial sectors, and Chinese companies have paid a high price," said Xu in a report to the National People's Congress on government's efforts on improving innovation and IPR protection on Thursday.

Ever since China's entry into the WTO, multinational corporations have rushed patent applications of existing and new products, leaving their Chinese counterparts in an awkward situation as they see their core technologies being grabbed by foreign firms, Xu said.

In China, foreign firms hold the majority of invention patents, and mostly in the high-end sectors such as wireless communication, western medicine and computers.

About 99 percent of Chinese companies fail to apply for patents. As a result, Xu said, Chinese firms have to pay 20 to 40 percent of the price of every mobile phone or computer to an overseas patent holder.

Worldwide, the situation is not encouraging either, as 86 percent of the world's research investment and 90 percent of the patents are in the hands of developed countries, he added.

Government policies, management, and a lack of public awareness are all to be blamed, Xu said. "Right now Chinese companies are unable to play the leading role in the country's innovation drive as required."

According to ministry statistics, investment in research makes up only 0.71 percent of the revenues of major Chinese state-own businesses.

Source: Xinhua