Patent Office Promotes 'Intellectual Property Transactions Activation' Including Fostering Private Brokerage Agencies

Provided by the Korean Intellectual Property Office

[Asia Economy (Daejeon) Reporter Jeong Il-woong] Activation of intellectual property (IP) transactions through fostering private intermediary institutions and establishing a transaction system is being promoted.

On the 29th, the Korean Intellectual Property Office (KIPO) announced measures to activate IP transactions at the ‘116th Government Policy Coordination Meeting’ chaired by Prime Minister Chung Sye-kyun.

According to KIPO, South Korea ranks first in the world in research and development (R&D) investment relative to gross domestic product (GDP) and fourth in the number of patent applications (about 220,000 annually).

However, the current status is that the scale of technology transactions in universities and public research institutes, where 70% of the government R&D budget is invested, is only about 6% of that of U.S. universities.

Accordingly, KIPO has set three main strategies for activating IP transactions: ▲ fostering private intermediary institutions and establishing a transaction system ▲ building infrastructure for IP transactions ▲ creating demand for IP transactions, and will implement 12 tasks.

To this end, KIPO plans to foster 36 private IP transaction institutions over the next five years through the IP Exchange under the Korea Invention Promotion Association. After selecting potential private institutions, the IP Exchange will transfer consulting know-how to induce activation of IP transactions starting from the private sector.

Additionally, KIPO will establish an ‘idea transaction platform’ where consumers’ proposed ideas can be purchased by companies, creating an environment where even small ideas can be actually traded, and introduce an IP auction system using a ‘masked bidder method’ that combines private contracts and auctions.

The IP auction system will operate by having the IP right holder make a preliminary contract with the initial prospective buyer, then publicly disclose it; if there are no additional bidders, the contract is finalized, but if there are bidders, the initial prospective buyer can purchase first at the highest price originally offered.

Furthermore, KIPO will simultaneously promote securing infrastructure to induce IP transaction activation and creating demand for IP transactions.

First, establishing IP transaction infrastructure focuses on improving related laws and systems so that patents abandoned by universities and public research institutes can be transferred to inventors to continue commercialization, and building a reference database (DB) by linking IP transaction information that was previously dispersed and managed by different ministries.

Also, creating demand for IP transactions will be promoted by establishing a cooperative system among public institutions related to transactions such as the Korea Technology Finance Corporation, Korea Invention Promotion Association, Korea Patent Strategy Development Institute, and Agency for Defense Development, encouraging cooperative IP transactions that combine the strengths of each institution.

KIPO Commissioner Kim Yong-rae said, “Intellectual property, which is the result of research and development, only has meaning when demanders such as companies properly recognize and utilize its value,” and added, “We will strive to ensure that these measures can effectively resolve the current ‘Korean-style R&D paradox,’ where R&D outcomes do not lead to innovation momentum.”