STIINPL › Public sector research - shaping factors - IPR regimes
What are IPR regimes?
Intellectual Property Rights (IPR) are legal titles which give their owner specific exclusive rights on some intellectual product. Major types of IPR are the following:
IPR is first defined as a right to exclude others from using the protected piece of information without the consent of the owner. The conditions of grant and the specific rights and obligations vary according to the type of IPR. This page concentrates on patents, which are the major IPR associated with innovation.
The economic raison d’être of patents is to incentivise inventive activities. The patent system relies upon inventors being responsive to the supplementary revenue permitted by their monopoly power if the invention is successful on the market. Patents are granted as a quid pro quo for the disclosure of the invention: they therefore play a role in the diffusion of knowledge.
IPR regimes are the set of interrelated institutions that shape the functioning of IPR and its connection with the economy. Patent regimes are national in nature, as patent laws are national. However, they share commonalities across countries, notably as national choices are strongly constrained by international treaties (like the Paris Treaty of 1883 or the more recent TRIPS Agreement of 1994). As a result, there is little diversity left across countries regarding the core, explicit rules that govern patenting, particularly between developed countries. As for developing countries, they are rapidly aligning their IPR regimes in accordance with the TRIPS Agreement, and the major remaining issues concern enforcement rather than legal alignment.
Patents are market-based instruments, which is the reason why they were included in the 1994 WTO TRIPS Agreement. They affect directly the downstream stages of business processes (sales) and have only an indirect impact on upstream activities (invention). In a globalised world, where the market for most innovative goods is world-wide, the impact of a particular country’s patent regime on its national competitiveness is often limited (e.g. a Danish biotech company will be more affected by the US patent regime than by the Danish one as it has much higher sales in the US). However, clauses that affect the early stages of the invention process (like the “grace period”, see below) have a direct impact on inventive activities.
The Patent Statistics Manual provides more information on the legal foundations of patents (sections 2.2 and 2.3), patenting procedures across jurisdictions (chapter 3) and the rationale for patents and their economic impact (section 2.4).
PUBLIC SECTOR RESEARCH
How are IPR regimes relevant to the contributions of public sector research activities to innovation performance?
The incentive to invent is not an essential motivation for applying IPR to research universities and PRIs, as their research is mainly funded by public resources. The rationale for patents in PRIs is rather on the commercialisation side: it has been found that a number of inventions emanating from public sector research remain on the shelves as their development would require significant downstream investment by commercial companies, investment that will happen only if companies feel protected regarding possible competition at a later stage. Patents are the proper response to this concern.
The Bayh-Dole Act (passed in the US in 1980) instituted a uniform patent policy across federal agencies and removed many restrictions on licensing. It allowed universities to own the patents arising from federal research grants. Bayh-Dole also stipulated that researchers working on a federal research grant are required to disclose their inventions to the technology licensing office, which will chose whether to patent them or not. Similar legislation was then passed in almost all OECD countries in the 1990s and early 2000s, substituting in general the previous system of “professor’s privilege”, where the inventor could decide themselves whether or not to patent the invention and would in general own the patent. Sweden and Italy are the two remaining exceptions to this Bayh-Dole Act wave.
How do IPR regimes shape the interests, activities and resources of the relevant actors?
The relevant actors include:
In addition to policies specific to research universities and PRIs (e.g. Bayh-Dole Act types of measures), a number of features of patent regimes have a significant impact on the use of patents by such research performers:
List of useful links