Fast-tracking Green Patent Applications: An Empirical Analysis

Study
Date period
1 February 2013

SummaryIn recent years, innovation has topped the agenda of policymakers worldwide as they seek to promote green growth and advance sustainable development. As a result, several countries - including Australia, Canada, Israel, Japan, Korea, the United Kingdom and the United States - have put in place green patent fast-tracking programmes with the aim of accelerating the development and diffusion of environment-friendly technologies. Most recently, China and Brazil have also adopted such measures.

This study by Antoine Dechezleprêtre, a Research Fellow at the Grantham Institute on Climate Change and the Environment at the London School of Economics (LSE), is the first empirical analysis of these programmes.  Fast-tracking procedures - which allow applications to be examined and granted at a faster pace than regular patent applications - enable applicants to start licensing their technologies sooner and reach the market more rapidly.

Green fast-tracking programmes can reduce the time from application to the grant of a patent by 42-75 percent, the study finds.  Climate change-related technologies - particularly renewable energy technologies - represent the vast majority of patents in these programmes.

The study also finds that there is a clear demand for these procedures, especially from small start-up companies in the green technology sector. Fast-tracked patents are also of significantly higher commercial value than other green patents not requesting accelerated examination. Finally, the study shows that - in the short run - fast-tracking programmes have accelerated the diffusion of knowledge regarding green technologies.


Foreword

Addressing climate change requires the large-scale development and diffusion of technologies to bring about the required changes to our patterns of production, consumption and energy use.

In 2010, the United Nations Framework Convention on Climate Change (UNFCCC) established a Technology Mechanism to accelerate the development and transfer of technologies for climate change mitigation and adaptation. Efforts are now underway to make this Technology Mechanism fully operational.

However, the issue of intellectual property rights (IPRs) has remained one of the most contested in this arena. While it continues to be raised in the meetings of UNFCCC bodies, there has been no agreement on how to address it. Discussions too often tend to pit those who believe that IPRs are inherently a significant barrier to the transfer of climate change technologies against those who can only conceive them as incentives for climate technology innovation and as a sine qua non condition for any subsequent technology transfer and diffusion.

In September 2012, the Technology Executive Committee (TEC) – the policy arm of the Technology Mechanism – forwarded a report on its activities and deliberations to the 18th UNFCCC Conference of the Parties (COP), held in Doha, which identified IPRs “as an area for which clarity would be needed on its role in the development and transfer of climate technologies based upon evidence on a case by case basis.”

A similar approach has, in fact, guided the work of the International Centre for Trade and Sustainable Development (ICTSD) in this area since the publication of the seminal paper by the late John Barton on Intellectual Property and Access to Clean Technologies in Developing Countries (2007) and the report on Patents and Clean Energy published with the European Patent Office (EPO) and the United Nations Environment Programme (UNEP), which became important milestones in the policy research on these issues. Since then, we have strived to address knowledge gaps, in particular at the level of empirical research and analysis, and clarify policy options that would help governments and other stakeholders better grasp the complexities and nuances of a multi-faceted issue that defies simplistic categorizations.

It is with this spirit in mind that we thought it would be timely to have a closer look at the measures taken by a number of countries, in recent years, to fast-track “green” patent applications. These measures allow applications to be examined and granted at a faster pace than regular patent applications.

In effect, starting 2009, a number of mainly industrialised countries – including the United Kingdom, the United States, Australia, Korea, Japan, Israel and Canada – have implemented fast-tracking measures and were more recently joined by emerging economies, such as Brazil and China. However, to date, no in-depth empirical analysis has examined these measures and their effects.

How many patents have been filed under the various fast-tracking schemes? Which technologies are mostly concerned? Do the programmes significantly reduce the time from filing the patent to it being granted, compared to regular examination procedures? What type of company is most likely to make use of the fast-tracking procedure? Do the programmes encourage the diffusion of green technological knowledge? These were some of the questions identified for the research project undertaken by Antoine Dechezleprêtre, a Research Fellow at the Grantham Institute on Climate Change and the Environment at the London School of Economics and Political Science (LSE), with previous experience in collecting and studying patent data in relation to renewable energies. For this paper, the analysis of patent data was complemented by interviews with a number of patent attorneys and intellectual property professionals carried out by the author.

This paper is thus the first study to empirically analyse green patent fast-tracking programmes and to examine whether these programmes may help the diffusion of green technologies. After pointing out the main differences among the approaches made by different countries, in particular the different definitions of what constitutes a “green” patent application, the paper presents several key findings.

First, despite a low participation in the programmes, which reflects the strong incentive for patent applicants to keep their patents in the examination process for as long as possible, there is a clear demand for fast-tracking procedures, in particular from small but fast-growing start-up companies in the green technology sector. Second, climate change-related technologies (in particular renewable energy technologies) represent the vast majority of patents in the fast-tracking programmes. Third, the time from application to grant has been effectively reduced by up to 75% for patents entering the accelerated procedure. Fourth, fast-track patents are of higher commercial value than other green patents that were filed at the same time but did not request accelerated examination.

Finally, the analysis of patent citation data shows that fast-tracking programmes have accelerated the diffusion of knowledge in green technologies in the short run (during the first years following the publication of the patents), but whether this effect will be the same in the long run remains an open question.

In addition to these important findings, the author highlights a number of questions that could be addressed by future research. In particular, he underlines the need for more information about the licensing practices of companies using fast-tracking programmes, as this would enable a better understanding of the extent to which these programmes accelerate the diffusion of green-patented technologies through licensing, in particular to firms and institutions in developing countries.

Given the urgency of addressing environmental challenges, including climate change, the effects of fast- tracking programmes appear encouraging, particularly with regard to accelerating technology diffusion in the short run, though, as it has been mentioned, further research is needed to understand the longer-term effects and licensing practices.

More importantly, the fast-tracking programmes for “green” patent applications raise broader questions about the overall coherence and unity of the patent system. Are these programmes the start of a parallel patent system for green technologies? Should they be applied across the board and not be restricted to “green” technologies – as suggested by the author of the paper – as is the case for the EPO, which has an accelerated examination procedure that any applicant can request? Can the patent system remain technologically “neutral” or does it run the risk of greater fragmentation when faced with multiple demands for the differentiated treatment of specific sectors and technologies? Are these fast-tracking programmes ultimately a reflection of the capacity of the system to respond to new public policy challenges? Wouldn’t such a capacity of adaptation also require further consideration of specific measures in the context of the system to promote the transfer and dissemination of technological knowledge? All these are open questions that an increasingly globalized patent system has to tackle.

I hope that the findings of this study on fast-tracking programmes for green patent applications will be useful for global and national efforts seeking to encourage green innovation as well as the transfer and diffusion of green technologies.

Ricardo Meléndez-Ortiz

Chief Executive, ICTSD