China appears determined to become the world leader in the various high-tech sectors (telecommunications, computing, semiconductors and medical technology) through a record number of patent filing figures according to WIPO’s recent World Intellectual Property Indicators report. In 2015, Chinese applicants filed more than one million patent applications in China. Together with the relatively strict technology transfer requirements which impede the transfer of technology outside of China, substantial effort has been made in retaining ownership of high-tech inventions within China.

China’s economic growth has obliged it to join the global IP system and the Chinese Government also provides incentives to support local patent filing. Additionally, China has attracted foreign corporations to increasingly seek Chinese IP protection. China remains a world-leading manufacturing powerhouse for many sectors and it is also set to become the largest consumer marketplace in the world, making a further increase in local filing figures likely.

Interestingly, China-based inventors filed only about 40,000 invention patents outside of China in 2015, which is significantly fewer than for local filings. A lack of financial incentive could be a reason, but also, there appears to be a generally lack of appreciation of the value of IP rights and the benefits for Chinese SMEs of expanding overseas.

We would expect these perceptions to change soon given that prominent companies such as Huawei and ZTE are leading the way in perfecting IP protection for innovations worldwide. These Chinese companies are active in patent litigations in Europe and US, demonstrating their focus not just on securing patent protection, but on enforcing it too. This should pave the way for small and medium companies to reach out and join the wider international market.