Innovation & Patents In the United Kingdom

United Nations Offices in Geneva

Author Tom Page Licence CC BY 2.0 Source Wikimedia Commons

Jane Lambert

The Chartered Institute of Patent Attorneys has recently published a 10-page paper entitled Innovation & Patents In the United Kingdom.  In it, the Institute notes that British businesses are falling behind their European competitors in the international patent protection of their technology and proposes a number of remedies including supporting the Society for Chemical Industry's proposal for a Science and Innovation Growth Council to "ensure science industrialisation is at the heart of government policy."

As I said in my opening remarks to the attendees of the Cambridge IP Law Summer School at the start of the session on patents on 13 Aug 2024, a patent confers a monopoly which automatically excludes competing products or processes from the market of the country for which it is granted for so long as the patent remains in force.  It follows that the patent confers a competitive advantage upon the patentee.  Of course, patents have to be obtained for a purpose.  There is no point in acquiring them for their own sake.  But where they implement a business's objective they are a good thing.

I have always regarded it as concerning that European patent applications from the UK have consistently trailed not just the USA and Japan or even countries of approximately the same size such as Germany and France but also the Netherlands with a third of this country's population or Switzerland with one eighth.  As long ago as 10 Sept 2008 I drew up the following table which I inserted in the first blog post of NIPC Yorkshire:

European Patent Applications since 2002

Country	2007	2006	2005	2004	2003	2002
USA	35 588	34 794	32 738	32 625	31 863	30 118
Germany	25 176	24 806	23 789	23 044	22 701	21 039
Japan	22 887	22144	21 461	20 584	18 534	15 912
France	8 328	8 051	8 034	8 079	7 431	6 853
Netherlands	6 999	7 360	7 799	6 974	6 459	5 054
Switzerland	5 855	5 503	5 027	4 663	4 180	3 882
UK	4 979	4 722	4 649	4 791	4 843	4 709
South Korea	4 934	4 595	3 853	2 871	2 075	1 408

(Source Jane Lambert (c) 2008 compiled from annual "Facts and Figures" published by the European Patent Office)

In my article, I wrote:

"The reason for our lacklustre performance is that start-ups and other small businesses, that are the mainspring of innovation in the UK as in most of our competitors, make much less use of the intellectual property system than their equivalents in other countries and, indeed, much less use than multinational enterprises and other big businesses here."

The CIPA seems to have arrived at a similar conclusion because the last section of their paper is headed "Support for Innovative SMEs".

I diagnosed the problem as follows:

"There are two reasons why small businesses eschew the intellectual property system. One is that the cost of obtaining and enforcing legal protection for investment in brands, design, technology and the creative works is prohibitive and the other is that the intellectual property services available to small businesses, particularly outside London, is patchy in quality and, when compared to the unit costs that major companies pay, relatively expensive.
As for cost, research commissioned by the European Patent Office reported that it costs over €32,000 to obtain and maintain a typical, European patent on 6 countries over 10 years. But those costs pale into insignificance when compared to the cost of enforcement, particularly in the UK. According to the British government's own (but now disbanded) Intellectual Property Advisory Committee, it can cost over £1 million for an infringement action in the Patents Court and even £150,000 to £250,000 for the Patents County Court compared to no more than €50,000 in France, Germany and the Netherlands (see the table at page 50 of IPAC "The Enforcement of Patent Rights" published on 18 Nov 2003). The other big difference between big and small companies is that the latter know how the IP system works. They have day to day experience of the legal protection that is available in each jurisdiction, which innovation is worth protecting and which is not, the optimum protection for each innovation in each market, which lawyer, patent or trade mark attorney is good for a particular type of work and so on. They can use their considerable purchasing power to secure the services of the best professionals on advantageous terms. By contrast, inventors and small business people resort to the lawyers who drew up their lease and drafted their T & C and employment contracts who are as often as not on an expensive learning curve and who are forced to pass on their cost of learning or perhaps purchasing the expertise of the London patent bar on to their hard pressed clients."

 Despite the Arnold reforms and the shorter trials scheme TaylorWessing's Patent Map indicates that England and Wales is still the most expensive jurisdiction in Europe to bring or defend an intellectual property infringement action.

Sixteen years ago I wrote that there may not be much one can do about the imbalance of resources between big and small companies but there is a lot that can be done about the learning curve.   My solution was to educate SMEs.   I wrote:

"Inverting the famous conversation between F Scott Fitzgerald and Ernest Hemingway, SMEs are different from other IP users. They have much less money and the little they have has to be husbanded widely. Wise husbandry requires very special skills and those skills are not easy to identify."

To pass on those skills I set up IP Yorkshire on Linkedin which continues to this day:

"To assist businesses to identify high quality advisors NIPC has established a panel of trusted professional advisors who possess those skills and share our mission of bringing high quality professional services within reach of those who need them most but can often afford them least. They include patent and trade mark agents like Janet Bray, Carin Burchell and Barbara Cookson, specialist IP solicitors like Kate Reid of Pemberton Reid and James Love, company and commercial experts like Jane Sachedina and Umberto Vietri and experts in many other fields such as Richard Hall in product design and development, Gareth Morgan in marketing, forensic accountant, Michael Swift and many, many, more. These are some of the experts to whom we refer clients when we are asked to recommend solicitors, patent agents or other professionals. We do that safe in the knowledge that each of those professionals knows his or her job, each of them cares about our clients just as much as we do and each of them will give our clients that professional's best deal."

The CIPA has also concluded that the answer lies in education and they offer to provide it:

"We think that CIPA can bridge this gap because it is our members that are providing the support to practically every British SME that is developing and patenting technology. We want to use our experience of SME technology development and commercialisation to help the government develop innovation policy. We think that our knowledge of the real challenges faced by SMEs commercialising technology can inform practical solutions."

Attorneys are certainly part of the solution but they are not enough by themselves.   They need the skills. experience and knowledge of other professionals such as the group I corralled in this county.   

The only part of the report that I cannot understand is the call for a Science and Innovation Growth Council.  Its functions are not explained and I fear that it would easily degenerate into a quango.  Of course, it has been proposed by the Society of Chemical Industry which is a powerful industrial body and a useful ally. 

I welcome, commend and support the CIPA's initiative though I would take its proposals further.   Anyone wishing to discuss this note may call me on 020 7404 5252 during UK office hours or send me a message through my contact page.