Lessons from the Australian Intellectual Property Report 2020

In brief 3 min read

The Office of the Chief Economist of IP Australia published its flagship annual publication, the Australian Intellectual Property Report 2020 (the report), on 22 May 2020. The report identifies some key trends, which will assist businesses' understanding of current trends in IP filings in Australia. Note that due to the time frame of data collection, this report does not reflect global economic conditions caused by the COVID-19 pandemic, the impact of which on Australia's IP statistics remains to be seen.

Key takeaways

• Take advantage of market opportunities, as the Australian economy continues to become more connected with China's and the global digital economy.
• Ensure your design rights are being protected, to maximise your business' productivity.

Trends identified in the report

Increases in patent and trade mark applications in and from China

In 2019, non-residents filed 91% of total patent applications in Australia. While the US remains the greatest source for non-resident applications (46%), applications from China increased by 46% from their level in 2018, continuing an accelerating growth trend. Notably, three of the top five applicants for Australian patents are based in China.

Similarly, China's growth rate in trade mark applications filed in Australia has far surpassed any other country's, and grew exponentially between 2014 and 2017. While this figure fell 14% in 2019, this likely reflects a softening of global economic growth following a record-breaking 2018.

In 2016, China overtook the US as the most preferred trade mark filing destination abroad for Australian applicants. This reflects the growing interconnectedness between the Chinese and Australian economies. The growth trend is consistent with the World Intellectual Property Organization's 2020 statistics, which show that China is the leading destination for patent and trade mark applicants globally, receiving 46% of the world's patent applications and 51% of the world's trade mark applications.

Patents and trade marks in the digital economy

Trends in information and communication technologies (ICT) patents and trade marks show that Australia’s digital economy is strongly connected with the international digital economy.

After a dip connected with the dot.com crash of the early 2000s, the number of ICT-related patent applications grew consistently from 2012, and by 2016 had recovered to near their level before the crash. Similarly, the number of ICT-related trade mark applications has tripled from 2002 to now, representing 26% of total applications, and recovered in 2017 to the level observed in 2000.

The recent boom has reflected the global trend of increased investment in consumer technology, with names and brands being a major asset.

The economic impact of design rights

The report includes an analysis of the correlation between holding IP registrations and business profit. No clear trends were reported, demonstrating the limitations of a macro-level analysis across sectors.

A more granular insight from the report relates to registered design rights, which are particularly useful for businesses active in manufacturing and trade. Businesses in design rights-intensive industries spend 50% more on average on research and development, and are more active in global value chains. Globally, China is currently the leading destination for design filings (54%), followed by the EU (8%). The study concludes that holding a registered design right increases businesses' productivity. This supports the Australian Advisory Council on Intellectual Property's recommendation to reduce fees for multiple design applications and extend the maximum term of design protection to 15 years.

Actions you can take now

• Seek advice from Allens' Intellectual Property team on how to maximise the value of your intellectual property.
• Stay alert to shifts in these trends during, and after, the COVID-19 pandemic.