514. The United States welcomes this opportunity to co-sponsor this agenda item and we thank Japan for introducing the topic.
515. The United States welcomes this opportunity to share views and experiences on the important issue of Making MSMEs Competitive Through Inclusive Protection of Various IPs.
516. As it is the case in many countries, MSMEs are critical to the American economy. They create jobs, spur innovation and foster entrepreneurial spirit.
517. Particularly during these troubling economic times caused by COVID, innovation and the incentives created by IP systems will be key to pulling countries toward global economic recovery.
518. How governments can support MSMEs during this period will be important. WIPO's 2020 Global Innovation Index theme of "Who Will Finance Innovation?" - asks a vital question that business and policy leaders will need to consider during these uncertain economic times. Nonetheless, this question should be viewed as a call to action to sustain innovation.
519. Taking steps to help foster and increase local innovation should become a key policy response to a prolonged downturn. For that to be effective, it will have to go hand in hand with raising awareness of, and growing support for, IP - particularly among start-ups and MSMEs.
520. With respect to the United States' experience in this area, the US Government plays an important role in promoting the growth and competitiveness of MSMEs by developing ecosystems where MSMEs, start-ups and entrepreneurs thrive and become the successful businesses of tomorrow.
521. The US Government provides key resources, both financial and educational, to make sure that innovators have what they need to turn a great idea into a successful business and take advantage of global opportunities.
522. These resources include funding provided to small businesses by 11 participating federal agencies through the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programmes coordinated by the US Small Business Administration.
523. Each year, the participating federal agencies are required to allocate about 3% of their R&D budget to fund these programmes.
524. By reserving a specific percentage of federal R&D funds for small businesses, the SBIR programme protects small businesses and enables them to compete on the same level as larger businesses.
525. The SBIR programme funds the critical start-up and development stages and it encourages the commercialization of the technology, products, or services, which, in turn, stimulates the US economy and local economic competitiveness by encouraging higher rates of job growth, wage growth, new business formation and innovation in those regions.
526. Since its enactment in 1982, the SBIR programme has awarded over USD 40 billion to thousands of research-intensive American small businesses. Their contributions have enhanced the nation's defence, protected our environment, advanced health care, and improved our ability to manage information and data.
527. It is well-documented that protection of intellectual property rights is essential for attracting additional private investment and product development resources.
528. A number of recent studies looked at the value of patents and other intellectual property assets to start-ups.
a. One study found that a patent grant increases a start-up's chances of securing funding from venture capitalist by 47%, and of securing a loan by pledging the patent as collateral by 76%, within three years of the patent grant.
b. A patent grant also more than doubles the odds of the start-up raising funding from an initial public offering. The study concludes that "a patent grant sets a start-up on a growth path through funding that helps transform its ideas into products and services that generate jobs, revenues, and follow-on inventions."
c. Another study done by the Massachusetts Institute of Technology (MIT) Innovation Initiative Lab for Innovation Science and Policy, found that securing a trademark in the first year of business and securing patent protection, among other factors, both positively correlate with the start-up growth.
d. A granted patent facilitates bargaining, licensing, and other transactions which are vital to the process of commercialization of new products.
e. Other recent research found that a start-up's first granted patent puts the company on a higher employment growth path, which continues for five years. Start-ups that received a patent showed a 6% increase in employment growth in the first year, with this growth differential increasing to about 55% by the fifth year.
529. Equally important for small business are other types of IP protection - trademarks, copyright, designs and trade secrets.
530. The United States Government, including the United States Patent and Trademark Office (USPTO), has a variety of programmes and initiatives designed to promote innovation, to help individual inventors and small businesses to protect their IP and to commercialize their inventions.
531. Let me briefly discuss some of these programmes and initiatives at USPTO.
a. USPTO offers patent fee discounts for small and micro entities. USPTO also offers small and micro entity discounts on search and preliminary examination of international patent applications for which the USPTO is the International Searching Authority or International Preliminary Examination Authority under the Patent Cooperation Treaty (PCT).
b. USPTO's Inventor and Entrepreneur Resources webpage offers information for start-ups, individual inventors and entrepreneurs on the patent and trademark process and offers a number of guides and other resources to assist inventors and entrepreneurs in protecting their IP rights.
i. We have the USPTO's Inventor Assistance Centre as well as other programmes in this area.
c. The USPTO's Inventor Assistance Centre (IAC) cannot provide a legal opinion or advice, or do a patent search.
d. To further assist MSMEs in commercializing their inventions as well as to aid in the fight against COVID-19, the USPTO has launched a Prioritized Examination Pilot Programme for small and micro-entities for patent applications that are subject to an applicable federal marketing approval for COVID-19 use.
i. There is also a prioritization examination programme for marks used to identify qualifying COVID-19 medical products and services, helping to bring these critical products and services to market more quickly.
ii. Also, the USPTO's Patents 4 Partnerships is a meeting place that enables patent owners who want to license their IP rights to connect with the individuals and businesses who can turn those rights into solutions.
iii. The P4P platform will provide entities like MSMEs and start-ups that have limited resources a valuable tool to match their technologies with interested buyers and licensees.
iv. Another recent patent administrative initiative that would benefit MSMEs and facilitate collaboration, is the deferral of provisional application fees in exchange for early disclosure of technical subject matter of COVID-19-related inventions on the USPTO website, as mentioned under agenda item 3.
v. Further information on the USPTO's initiatives on life science technologies can be found on the COVID-19 Response Resource Centre page of the website.
e. With respect to intellectual property education, the USPTO offers a number of educational resources and conducts a number of educational programmes for small businesses.
i. For example, on our website, we offer a web-based tutorial and a detailed guide on how to conduct a US patent search; a training video on electronic filing; step-by-step guides on patent and trademark processes and many other resources.
ii. We offer six e-modules on intellectual property protection and enforcement in five languages.
iii. We also regularly conduct webinars on IP-related issues, Expos, training programmes, roadshows, public meetings, discussions, many of which are webcasted.
iv. In helping MSMEs leverage the synergistic effects of registered and unregistered IPs, we work with other US government agencies to provide training to foreign officials and businesses on trade secret protection and enforcement.
- Like patents, trade secrets are important tools to provide legal protection for firms wishing to protect their valuable IP.
- In fact, SMEs and MSMEs may rely more heavily on trade secrets than on other forms of intellectual property, as the costs of obtaining and maintaining a patent, coupled with the costs of patent litigation, can make it more financially viable for smaller businesses to depend primarily on trade secrets. Additionally, not all innovations are eligible for patent protection.
- Trade secrets are particularly attractive for MSMEs that have processes and service innovations and have kept such business information secret. MSMEs often go the trade secret route when the early stages of innovation are critical to their long‑term success and there are time and cost pressures on the business.
- The theft of trade secrets adversely affects entities of all sizes, particularly MSMEs. The USPTO provides training to foreign officials on the importance of trade secret protection laws that enable MSMEs and start-ups to take action against trade secret theft. Practical steps are also highlighted to businesses to protect their commercially valuable proprietary information.
v. Another valuable resource for MSMEs is the Patent and Trademark Resource Centres (PTRCs) which are part of a nationwide network of public, state, and academic libraries designated by the USPTO to support the public with trademark and patent assistance.
532. Finally, the USPTO's four Regional Offices located in Detroit, Denver, Dallas and San Jose serve the local communities in which they are located, with a special emphasis on universities, individual inventors, SMEs and MSMEs.
533. These are just some of the examples of IP assistance programmes in the US dedicated to helping MSMEs. For those interested in Intergovernmental Organization support, WIPO has launched a new initiative for SMEs and MSMEs to undertake a basic diagnosis of their IP assets. WIPO's IP Diagnostic Tool generates a report based on the answers of a business, thereby providing an assessment of the IP assets that a business may have and how it may consider protecting and exploiting them as well as the risks to the business in not managing these assets. The Tool can be accessed from the WIPO SME website.
534. We hope this information provides micro and small businesses with the resources needed to protect their IP, grow their businesses, create jobs and build a more competitive and resilient economy.
