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Taiwan Suffers US$5 B. Annual Deficit in Patent Royalties

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Taiwan Suffers US$5 B. Annual Deficit in Patent Royalties


Taiwan Suffers US$5 B. Annual Deficit in Patent Royalties

    Taipei, Dec. 18, 2012 (CENS)--Taiwan suffers an annual deficit of US$5 billion in the payment for the royalties of intellectual properties and the amount is growing annually, pointed out Cyrus Chu, minister of the National Science Council (NSC) yesterday (Dec. 17).

    Meanwhile, Morris Chang, chairman of Taiwan Semiconductor Manufacturing Corp. (TSMC), noted that the US$5 billion deficit for intellectual properties has seriously eroded the gross margin of domestic industries, adding that domestic industries should step up intellectual-property education, as the “intellectual-property mines” planted by foreign companies have seriously blocked the establishment of startups and innovation of the Taiwanese industries.

    Both men made the remarks at the ninth national sci-tech conference, which opened yesterday focusing on patent deployment by Taiwanese firms. In response to the NSC’s plan of establishing a Taiwanese IP protection network, especially in the field of emerging industries, Morris Chang believed that it’s too late for Taiwan to deploy in intellectual properties of emerging industries now. He also warned that Taiwan’s IP deficit will deteriorate further.

   According to the statistics of the NSC, Taiwan paid NT$170 billion of patent royalties to foreign firms last year, far exceeding patent-royalty income of NT$20 billion, leading to a deficit of NT$150 billion. Cyrus Chu stressed that it makes no sense for Taiwan to pay the huge patent royalties, in view of large amount of patents owned by Taiwanese institutions and firms. Taiwan, for instance, ranks fifth place worldwide in the amount of patents applied in the U.S.

   Cyrus Chu also criticized the protracted process for the approval of patent applications in Taiwan, which takes 45.12 months on average, compared with 33.9 months in Japan and 22.8 months in South Korea, although the amounts of patent applications in the latter two nations are much higher than Taiwan. The long screening time for patent applications has affected the development of domestic firms, according to Chu.