Can intellectual property (IP) rights be effectively used as a tool in structuring national development?
In December 2019, the Intellectual Property Office of the Philippines (IPOPHL) released the National Intellectual Property Strategy (NIPS), which was crafted under the assistance of the World Intellectual Property Office (WIPO). This project began way back in 2017 and was completed after a series of consultations with their stakeholders and with other government agencies.
The NIPS, set for 2020-2025, is a 29-page document that envisions the strategic utilization of an effective IP system as a vital force in structuring national development through IP. The NIPS is also intended to support the Philippine Development Plan (PDP) 2017-2022 and the Ten-Point Socio-Economic Agenda of the Philippine Government. The rationale is to make the industrial and creative sectors as “not just mere observers, but global players in international markets.”
To support this vision, the NIPS framework introduces five strategic goals aptly nicknamed as SPEED to refer to
- Support sectoral advancement through the use of the IP system;
- Promote innovation and utilization/commercialization of IP assets;
- Elevate the creative and cultural industries;
- Enhance the legal system, institutions, and structures related to IP; and
- Demystify, mainstream, and professionalize IP.
Although all the strategic goals have specific action plans intended towards a more effective IP system, there are a couple of items that emphasize the direct role of IP among MSMEs and startups.
The NIPS identified MSMEs as an important sector in the Philippine economy. The 2020 statistics from the Philippine Statistics Authority (PSA) indicates that 99.51% of all businesses are MSMEs, 88.77% of which are micro-enterprises, 10.25% are small and 0.49% are medium enterprises.
A strategy identified in the NIPS Strategic Goal #1 is to increase the use of the IP system by MSMEs by designing and implementing MSME IP Promotion Programs, developmental programs for local producers, and creating platforms to match industry technological needs with ITSO/TTO IP rights.
Strategic Goal #2 highlights the utilization and commercialization of IP assets by improving the research and development performance, enhancing the rationalization and funding processes for Government Funded Agencies (GFAs), and attracting smart and high technology investors into the Philippines. The relevant provisions of the Technology Transfer Act, Philippine Innovation Act, and Innovation Start-up Act are expected to play a major role in the implementation of these action plans. Both the Philippine Innovation Act and the Innovation Start-up Act were only signed into law last April 2019.
What the current numbers say
The rationale for the NIPS’ SPEED strategy includes looking into the country’s current innovation ecosystem.
One measure of this is the year-on-year (YoY) growth of total IP filings. Based on 2016-2021,, data, the YoY growth of total filings peaked in 2018 for patents and utility models, 2017 for industrial designs and trademarks, and 2016 for copyright deposits. The trend was eventually disrupted due to the COVID-19 pandemic in 2020, which was also supposedly the first official year of NIPS implementation. Back then, utility model applications and copyright deposits recorded the largest decline, both at around -44% YoY.
Optimistic figures were regained in 2021, when all IP filings have a positive % YoY growth, the highest being in utility models at 28.6% YoY and in copyright deposits at 121.9% YoY.
Another measure of innovation is the annual Global Innovation Index (GII) Report, which is co-developed by INSEAD and WIPO and aims to measure and rank the innovation level of more than 130 countries.
As of 2021, the Philippines continues to climb up the GII rank where it rose to the 51st from 73rd spot in 2018. However, it is noteworthy that the country also consistently ranked below the 50th place in the following areas: political, regulatory, and business environment, human capital and research, infrastructure, market sophistication, and creative output.
Meanwhile, the World Economic Forum (WEF) also released a Readiness for the Future of Production Report in 2018 that provides insight about the average readiness of 100 countries in terms of the structure and drivers of production.
The R&D expenditures, scientific and technical publications, and patent applications are among the indicators of a country’s ability to innovate. In these areas, the Philippines seems to lag behind other ASEAN and East Asian countries.
In terms of research intensity, the Philippines has only 0.30 patent applications per million population, which is much lower than Malaysia’s 5.66, Thailand’s 0.7, and Singapore’s 100.94 applications per million population. Our East Asian neighbors, Korea and Japan, have 400+ applications per million of population. Both the Korean and Japanese IP Offices are part of the IP-5, a forum of the five largest IP offices in the world.
Another indicator is the research and development (R&D) expenditure as a percentage of the gross domestic product (GDP) where the PH only scored 0.1 % GDP, placing it in the 89th place out of the 100 countries on record. The countries that ranked in the top 5, such as Japan and Korea, scored with at least 3.2% GDP while the top 50 countries scored with at least 0.7 %GDP.
Figures for the country’s R&D expenditure are tossed at around 0.07-0.08 %GDP for 2015-2017. The updated 2021 record shows that the Philippines is catching up at 0.2% GDP which is still less than a third of the percent expenditure of the top 50 countries in the cited WEF Report.
Recently launched IP Programs
Government agencies, in partnership with the educational and private sectors, recently launched new programs and continued the existing ones, which are consistent with the goals of NIPS and may encourage start-ups and MSMEs to invest in protecting their IP rights and other inventors to commercialize their IP assets. These are some of the programs:
Last March 2021, startups went through a one-month training program under IPOPHL’s MoA with Asian Institute of Management’s Dado Banatao Incubator. Twelve of the startups that participated had either applied for a patent grant or were already finalizing the requirements.
More recently, in March 2022, IPOPHL launched the Juana Patent and Juana Design Protection Incentive Program that waives certain fees and prioritizes applications from women-led MSMEs and startups via IPOPHL’s fast lanes.
Last May 2022, the Department of Science and Technology – Technology Application and Promotion Institute (DOST-TAPI) Director Marion Decena shared about the institution’s plans of internationalizing IP applications and funding spin-offs and startups in entering the global market by 2023. DOST-TAPI has consistently been providing financial and technical assistance to inventors, startups and MSMEs.
More than just numbers
The NIPS and the other strategies established by the government seem to steer towards improving the innovation ecosystem in the country and IP is most likely to play a vital role in this. An inventor, startup founder, or MSME owner should definitely consider participating in the ongoing and future IP awareness and assistance programs being offered by IPOPHL and other government agencies.
Aside from the active participation of the different sectors, building a better IP system may also mean looking more deeply into the context of innovation in the country – as the current numbers may just be the tip of the iceberg. More developed economies have in-depth studies on topics such as why startups don’t patent or on how patenting affects a firm’s performance so perhaps we also need to investigate and gather our own data to gain insight.
Hopefully in the next few years, we’ll be able to not just build a better IP system, but also be able to effectively use it as a tool in structuring national development.
References:
- Intellectual Property Office of the Philippines. (2019). The National Intellectual Property Strategy (2020-2025). https://www.ipophil.gov.ph/national-intellectual-property-strategy-nips/
- Department of Trade and Industry. (n.d.) 2020 MSME Statistics. https://www.dti.gov.ph/resources/msme-statistics/
- Intellectual Property Office of the Philippines. (n.d.). Statistics. https://www.ipophil.gov.ph/reference/statistics/
- Intellectual Property Office of the Philippines. (2021, January 26). 2020 IP Filings Down but could Register Record Growth Post-COVID. https://www.ipophil.gov.ph/news/2020-ip-filings-down-but-could-register-record-growth-post-covid/
- Intellectual Property Office of the Philippines. (2022, February 21). IP filings turn around with double-digit growth as economy reopened for 2021.
- World Intellectual Property Office. (2021). Global Innovation Index Analysis. https://www.globalinnovationindex.org/analysis-economy
- World Economic Forum. (2018). Readiness for the Future of Production Report 2018. http://wef.ch/fopreadiness18
- The National IP Strategy.
- Global Innovation Index Analysis.
- Intellectual Property Office of the Philippines. (2021, April 16). IPOPHL, AIM help startups apply for patent, target protecting more IPs of startups. https://www.ipophil.gov.ph/news/ipophl-aim-help-startups-apply-for-patent-target-protecting-more-ips-of-startups/
- Intellectual Property Office of the Philippines. (2022, March 31). IPOPHL launches new Juana Patent and Juana Design Programs to empower MSMEs, women inventors, designers. https://www.ipophil.gov.ph/news/ipophl-launches-new-juana-patent-and-juana-design-programs-to-empower-msmes-women-inventors-designers/
- Arayata, M.C. (2022, May 13). TAPI to assist start-ups, spin-offs enter int’l market. Philippine News Agency. https://www.pna.gov.ph/articles/1174424