• Teresa Stanek Rea, US Deputy Under Secretary of Commerce for IP: The Evolution of IP in the 21st Century: New Market Mechanisms and Policy – A Transatlantic Exchange

    October 05 2012, 01:00 - 01:00

    Summary and Highlights from the Evolution of IP in the 21st Century

    “The Evolution of IP in the 21st Century,” organized by the American Chamber of Commerce in France with CDC Propriété Intellectuelle, brought together key representatives of both the public and private sectors from the United States, France and the European Union. Participants gave their assessment of the most daunting challenges in the field of patents and IP today and proposed measures that might be taken to further the development and creation of a true market for intellectual property.

    Opening Remarks

    Patrick Terroir, Directeur Général of CDC Propriété Intellectuelle, noted the paradox of how, in spite the frequency with which the term is used, there is no ‘actual’ knowledge economy – with no places of exchange and no means of investing directly in IP assets. He also underlined the necessity to improve the circulation and exchange of inventions. The primary challenge, then, is to bring such an economy into existence and to create IP exchange mechanisms and then to transform IP, traditionally considered an instrument of protection, into an instrument of transaction.

    Panel 1 – The Business Perspective, the Evolution of Market Mechanism for IP

    Moderated by Frank Valentin, IP Practice Partner, De Gaulle Fleurance & Associés 

    To demonstrate a concrete step in this direction, Dean Becker, CEO of ICAP, spoke about his company. A US-based patent brokerage with operations in Europe, ICAP acts via an auction system, bringing together buyers and sellers and finding the right price point for transactions.

    Alfred Chaouat, Senior Vice President of Licensing & Intellectual Property at Technicolor (Thomson) continued by commenting on the complicated nature of patents, which could entail a number of problems, leading to patents actually infringing market access. Luckily, there are also developing solutions, such as patent pools in response to thickets (an overlapping set of patent rights), and the development of new IP market places is making the overall market more efficient.

    Gerard Pannekoek, President & CEO of IPXI Holdings, LLC, next elaborated on the work of his own company, which provides an alternative to the existing bilateral non-exclusive licensing model. This entails a public offering of patent families or bundles representing specific technologies with an approach based upon that of the carbon emission trading market, in that it is modelled as a compliance market. Although the model is yet unproven, it is one way to monetize IP, and IPXI Holding’s first offerings are scheduled for the coming months.

    Frédéric Caillaud, Director of Licensing & Business Development at L’Oréal, focused on other challenges in the market. Information asymmetry, for example, continues to pose major challenges, while sovereign funds have the potential to create patent thickets. He further stated that the market needs tools to identify new technologies to review and compare patents. 

    Laurence Joly, Directrice de l’Observatoire de la Propriété Intellectuelle from INPI, struck a hopeful note. In spite all the previously mentioned challenges facing the global knowledge economy, it is today more active than ever, as measured by the number of patents filed. During the 1980s, there were roughly 800 000 patents filed. Today, that number has increased to more than 2 billion.

    Speaking again, Patrick Terroir, Directeur Général of CDC Propriété Intellectuelle, emphasized the dysfunction of the market, which creates hurdles that most affect SMEs and public research organizations. To get around this, an IP market mechanism must be created that will offer stakeholders open access, security, transparency and standards.  

    Keynote Speech 

    Teresa Stanek Rea, US Deputy Under Secretary of Commerce of Intellectual Property and Deputy Director of the US Patent and Trademark Office, stated that, more than ever, patent work is being done at the international level. Together, the US, the EU, Japan, South Korea and China account for 76 to 80% of all patents filed worldwide. Because of this, they have increased cooperation, leading to the formation of the so-called IP5.  This groups together their patent offices to increase the efficiency of the patent examination process. Further, there have been discussions of a cooperative initiative called Global Dossier that would, using web-based cloud technology, allow patent examiners from the IP5 patent offices to benefit from each other’s work. Deputy Rea also touched upon the passage of the America Invents Act which takes the US from a ‘first-to-invent’ to a ‘first-inventor-to-file’ system.

    Panel 2 – National, Regional and Global Policy Perspectives, Patent Law and Impact to Business

    Moderated by Bruno Lanvin, Executive Director, INSEAD eLab 

    Vincent Champain, Directeur Secteur Public of GE France, began by insisting on the need to fight “IP erosion” and explained how important IP is for developed countries’ companies – and on the need to ensure that trade agreements include IP rights protection. Moreover, governments should give equal attention to “external IP markets” (where small companies seeks investments to build and sell innovations) as well as “internal IP markets” (where big companies commit very significant investments to build IP used for their own products).

    Pedro Velasco Martins, Deputy Head of Unit from the European Commission Directorate-General for Trade, Public Procurement and Intellectual Property, highlighted the EC’s work and policy challenges. The EC acts multilaterally and bilaterally to promote IPR in third countries. It is not an easy subject with emerging economies, but with China it is even more demanding. Overall, the EC’s trade policy goal is to open markets, but that requires effective rules to protect and enforce its IPR abroad. He also stressed the need for industry to be aware of a growing negative view of it in certain sectors of civil society, citing the risk of ‘erosion of IP’ as a result of this.

    Jacques Darcy, Head of Technology Transfer & Intellectual Property at the European Investment Fund, cited several important trends to watch. What is going to be China’s main strategy in the next 5 to 10 years? What is going to be the worldwide impact of the America Invents Act? What will be the future of the Unitary Patent? Here, he spoke of worries that the patent will end up being too costly and of whether there will be political will but not the business will for it. All this is of particular concern to the EIF because it deploys about 3 to 5 billion euros in early stage technologies and companies, with their main exposure being to IP.

    Bruno Lanvin next turned to ask Teresa Stanek Rea, US Deputy Under Secretary of Commerce of Intellectual Property, what she believes will be the impact of the America Invents Act. According to Deputy Rea, the biggest, hoped-for impact is that it will allow for less litigation of intellectual property rights in the US.

    Speaking on challenges more specific to the EU, Thierry Sueur, Vice-President, European & International Affairs, and Director IP from Air Liquide, commented on the lack of unity at the EU level. There is lack of consistency between different Commission directorate generals and division among MEPs. To bring more coherence, the solution is for there to be more Europe.

    Concluding Remarks 

    In closing, Bruno Lanvin, Executive Director of INSEAD eLab, reiterated the view that the world is at a historical period, when the whole notion of IP is changing. Its value is recognized, but there must also be a degree of regulation and consultation to create an efficient market. Action is now necessary to provide a degree of predictability in a highly moving environment that is the world of innovation. Action is also required to convince governments, entrepreneurs and civil society of the value of IP. More emphasis must be placed on ‘harmony,’ not ‘unison’ to take into account differences in views and practices and make this historical sea change in IP more palatable to all.