Strong Intellectual Property Rights (IPR) Protections Are the Root of 21st Century Economic Success
On February 8, the Global Intellectual Property Center (GIPC) of the U.S. Chamber of Commerce released the 2017 Global IP Index—the fifth annual edition of this publication. The Index is a comprehensive ranking of 45 countries that represent roughly 90 percent of global GDP. Each nation is assessed based on 35 indicators to determine the strength of its IP protection regime. The 35 indicators are divided into six broad categories: patents, copyrights, trademarks, trade secrets and market access, IPR enforcement and membership and ratification of international treaties. The Index assigns numerical rates for each category to all 45 countries with 35 being the highest possible total score.
The theme for the 2017 International IP Index was “The Roots of Innovation,” which is an apt metaphor. Without a strong root structure, plants do not thrive, and absent a strong IPR structure, a nation cannot thrive, given the direct correlation between the strength of a nation’s IPR regime and economic growth. Strong IPR protections are associated with increased private sector research and development, higher levels of innovation, greater high-value sector job creation and more promotion of cutting-edge clinical research. IP-intensive industries account for 27.9 million direct jobs and 17 million indirect jobs (roughly 35 percent of all U.S. employment), as well as 38.2 percent of the U.S. GDP in 2014. Jobs in IP-intensive fields pay on average 46 percent higher, underscoring the importance of IP on GDP, jobs and economic growth. Intellectual Property is the basis for revolutionary developments in many sectors of the economy and protecting IPR not only encourages and protects future innovation, but also ensures that innovators are properly compensated for their work.
For the fifth consecutive year, the United States ranked first with a combined score of 32.62, although the U.S. fell from first to tenth place in the patent category. However, at least as important as America’s IPR protection consistency are the positive strides several nations, notably the UK, Germany, Japan, Sweden and France, made in reforming their IP regimes modeling their IPR Protections on America’s. Meir Pugatch, who presented at the official Index release, observed that IP policy will no longer be based on “America, and then everybody else.” Rather, policy will be increasingly influenced by the actions of this highly-ranked group of nations adhering to high standards. Global cooperation and regulation to create an effective enforcement regime is vital, given the ease with which IP can be stolen and redistributed if standards differ from country to country. In addition, the advent of digital software IP makes it very easy to access stolen IP online without a concerted regime enforcing its protection. Limits on patentability for biotechnology and software – two very IP-intensive industries is another concern. Both industries are high-value sectors with long development cycles and are vulnerable to counterfeits making enforcement and an increased ability to patent their IP vital to their long-term financial success.
ALEC applauds GIPC for the successful release of the fifth edition of this invaluable resource. The Index has proven useful in highlighting the successes of IP protection regimes worldwide and identifying the many challenges that still lay ahead. ALEC has long recognized the importance of strong IPR protections – ALEC work on the issue can be found here. The enforcement of IPR must be a national priority in the U.S. and globally. Articulating the positive impact that strong IPR protections have on a nation’s economic growth is a constructive way to spur all countries to protect the innovation that makes revolutionary breakthroughs possible and enriches the world culturally.