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China's Patent Open Licensing System

CN-KnowHow IP Group

Recently, the China National Intellectual Property Administration (CNIPA) issued the "Notice on Comprehensively Promoting the Implementation of the Patent Open Licensing System." This notice marks a significant step forward in patent transformation in China, aiming to enhance the efficiency of patent transformation through the comprehensive implementation of the patent open licensing system. This article will explore the advantages of China's patent open licensing system and identify the types of patent holders we believe are most suitable for adopting this system.


Advantages of the Patent Open Licensing System

Patent open licensing, newly established in the fourth amendment of the "Patent Law of the People's Republic of China," offers several advantages:


  1. Simplicity and Efficiency: The "one-to-many" licensing model allows patent holders to achieve multiple licenses with a single declaration, significantly improving connection efficiency.

  2. Cost Reduction: During the open licensing period, annual fees are waived, reducing institutional transaction costs for patent holders.

  3. Transparency: Licensing fees are publicly listed, and the State Council's patent administrative department announces them to the public. Any entity or individual can obtain a license by paying the stated fee, ensuring fairness and transparency.

  4. Efficient Transformation: The system addresses the "last mile" issue in transforming scientific and technological achievements into productive forces, accelerating the market application of patented technology.

 


Patent Monetization


What types of patent right holders are more suitable for Patent Open Licensing System?

Based on our analysis and understanding, four types of patent holders are particularly suitable for adopting the open licensing system:


Non-Core Patents of Enterprises

Enterprises often have a portion of non-core patents. During the open licensing period, annual fees can be waived for these patents. Therefore, enterprises can use the open licensing system to reduce intellectual property management costs while increasing the actual application opportunities of their patents through public licensing.


Research Patents of Universities

Universities often lack the ability to transform or implement their patents after obtaining them, typically needing to cooperate with enterprises. When some patents encounter difficulties in transformation, the open licensing system can accelerate their implementation process, promoting the transformation and application of university scientific and technological achievements.


Research Institutes

Research institutes face similar patent situations as universities, focusing more on research rather than commercializing patents. Through the open licensing system, research institutes can more effectively promote their patented technology to the market, increasing the usage rate and value of their patents.


Patents with Broad Application Fields

Certain patents have wide application fields, often resulting in high licensing costs. By adopting the open licensing system, licensing costs can be significantly reduced while maximizing the benefits for patent holders.

 

Key Points in the Notice


Guiding Patent Holders to Submit Open Licensing Declarations

Provincial intellectual property offices need to guide patent holders to submit patent open licensing declarations in accordance with regulations. Declarations should include the patent number, patent holder, payment methods and standards for licensing fees, licensing period, etc., and be submitted online through the patent business handling system. Additionally, utility models and design patents require a patent right evaluation report.


Facilitating the Convenient Transition of Pilot Projects to Open Licensing

Intellectual property offices in pilot regions should guide patent holders to select high-quality patents with good market prospects from the pilot, submitting open licensing declarations. For declarations involving more than 10 patents with identical content, bulk submission in paper form is allowed. The CNIPA will expedite the review of these declarations.


Guiding Patent Holders to Reasonably Estimate Licensing Fees

Provincial intellectual property offices should promote common patent licensing fee payment methods and guide patent holders to reasonably estimate licensing fees. According to the "Patent Examination Guidelines," fixed licensing fees generally should not exceed 20 million yuan, and royalty fees should not exceed 20% of net sales or 40% of profits.


Strengthening the Open Sharing of Open Licensing Declaration Information

Open licensing declarations that pass CNIPA's examination will be announced to the public through the Patent Gazette. The public can query relevant information through the China Patent Publication and Announcement System. Open licensing announcement data will be fully accessible through the Intellectual Property Data Resource Public Service System, facilitating queries and access by all parties.


Conclusion

The comprehensive implementation of the patent open licensing system will effectively enhance the efficiency of patent transformation in China, promoting the transformation of scientific and technological achievements into productive forces. Various types of patent holders should actively utilize this system to reduce costs, increase the application and promotion of patented technology, and jointly drive the implementation of China's innovation-driven development strategy.

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CN-KnowHow IP Group

Intellectual Property Law Firm

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