IPR unleashes potentials of Chinese SMEs

Published on 01/05 2022  Source: China IP News


In an effort to ease financing access and cost for SMEs, better protect their legitimate rights and interests and upgrade their innovative power and sophistication, a total of 19 governmental departments including the Ministry of Industry and Information Technology and China National Intellectual Property Administration (CNIPA) released the Development Plan of Promoting SMEs in the 14th Five-year Plan Period on December 17, refocusing on SME development. This is just another SME-friendly IPR policy following a slew of such issued in November by the State Council's SME working group, notably among them including the List of Serving Specialized, Refined, Featured and Original SMEs and Some Measures to Upgrade Competitiveness of SMEs.

"IPR enables SMEs to use their uniqueness as a competitive edge and build up brand reputation. In particular, IPR is indispensable for the development of tech-driven SMEs," said Yuan Zhenfu, Dean of Shanghai University's IPR School. Yuan added that IPR helps protect the technological and brand advantages and constitutes the core market competitiveness of SMEs that function as the dominant power fueling the national economy and society, and the important foundation securing the resilience and dynamics of the market economy.

Empowering innovations

In recent years, China has given greater significance to upgrade SMEs' innovative power and sophistication. According to the Plan, small industrial enterprises above designated size (with annual revenue of over 20 million yuan) shall increase the number of patent applications by at least 10%, and the number of valid invention patents by at least 15% on the YoY basis. IPR, which reflects innovative power and sophistication of enterprises, plays a crucial role in SME development.

The Plan clarifies how to upgrade innovative power and professionalism of enterprises through IPRs. On the one hand, measures shall be taken to encourage SMEs to become more competent in generating IPR, develop IPR technologies and products and utilize IPR navigation to explore target patents and generate patents in core technologies and major processes. On the other hand, a special program shall be carried out to allow easier access to commercialization of others' patents by encouraging universities, research institutes and large state-owned enterprises to relax their terms when licensing out to SMEs.

Serving enterprises

SMEs have been daunted by hard and costly financing. IPR-pledged financing might be the solution. The Measures highlights the role of IPR pledge information platform, proposes IPR pledges in industrial parks and builds up the ability of SMEs to raise funds by using their intangible assets.

As a matter of fact, relevant departments have been making trials to better serve SMEs via IPR-pledge financing. Statistics reveal that nearly 9,000 SMEs in China, in 2020, obtained loans by pledging their patents and trademarks with a combined worth of 218 billion yuan. Through January to October this year, 240.77 billion-worth patents and trademarks were pledged, up by 50.6% YoY and having exceeded the total amount recorded in the entire year of 2020.

IPR can not only be used as pledges for financing, but also help SMEs enhance their competencies. The Plan requires better protection of SMEs' IPRs, including patents, copyright, trademarks and trade secrets. In the meantime, it is also necessary to establish and perfect the mechanism of rapid and cooperative protection of IPR while providing SMEs with one-stop IPR services integrating rapid examination, right determination and protection.

Thanks to IPR development, we look forward to seeing SMEs to contribute more to the high-quality economic growth in China.