Intellectual property rights protection may help local innovation in the long term - new study

Brussels, 20 February 2002

An intellectual property rights framework in pre-accession countries is beneficial for technology transfer, may lead to a local technology dependency, but ultimately could stimulate local innovation, according to a recent study.

Writing in the IPTS (institute for prospective technological studies) report, Nikolaus Thumm presents evidence showing that the establishment of a framework to protect intellectual property protection in countries such as Poland, Hungary, the Czech Republic and Slovenia encouraged more technologically advanced firms from the West to invest in the countries.

The short term effect of this led to increased technological dependency, but the long term effect may be to stimulate local innovation.

'It is difficult to evaluate whether the establishment of patent systems in PACs (pre-accession countries) has so far proven to be of direct benefit for local firms and inventors, although it clearly is for multinational companies. However, in the long run the patent system should spur the local innovation process,' writes Mr Thumm.

He goes on to add that innovation at a local level cannot be stimulated simply by legislative, regulatory and harmonisation efforts, although these are a step in the right direction. Many of the pre-accession countries made the transition from planned economy to market economy by pressing ahead with a framework for intellectual property protection, which made them more attractive as locations for foreign investment.

Innovation in the countries mentioned has become increasingly dominated by foreign firms and technology dependency has increased in some cases. This is highlighted by figures in Hungary and the Czech Republic, who both experienced increased technological dependency following the political changes in these countries after 1990. This is calculated by comparing the high level of patent applications by non-residents with the falling number made by local businesses.

There are some clear benefits to establishing a clear intellectual property protection framework, such as harmonisation measures with EU countries smoothing the accession process. And the study also found that traditional areas of local innovation, particularly in consumer goods, maintained a good level of patent applications, whatever the level of foreign investment. 'Moreover, despite the clear signs of technological dependency, PACs also have inventions of their own at the world's leading edge...although small compared to other western countries,' adds Thumm.

For further information, please consult the following web address:

http://www.jrc.es/pages/f-report.en.html The article is contained in issue 61.

CORDIS RTD-NEWS/© European Communities, 2001