Speech

UK-China Intellectual Property Symposium 2015

Baroness Neville-Rolfe talks about UK-China relations and initiatives to help businesses achieve better IP outcomes.

Baroness Neville-Rolfe DBE CMG

Thank you Neil for the introduction.

It is a pleasure for me to welcome you all to this intellectual property symposium.

I am especially pleased to see so many Chinese guests here today. We have:

  • representatives from 20 different central and local government departments; and
  • a wide range of Chinese businesses, including a delegation of companies from Beijing, Shanghai and Jiangsu province, organised by the China-Britain Business Council. This delegation includes leading Internet, pharmaceutical and automotive companies

The number of Chinese visitors here today shows how seriously China is taking intellectual property, something I witnessed personally during my visit to China last year.

State visit and UK-China bilateral relationship

I am especially pleased to be hosting this IP symposium on the occasion of the State Visit of Chinese President Xi Jinping to the UK. This visit marks a “Golden Era” of UK-China relations, and the UK-China relationship is “a comprehensive, strategic partnership for the 21st century”.

President Xi Jinping spoke yesterday in Parliament about the vitality of the UK-China relationship. And he quoted a famous English thinker from the Golden Enlightenment Age, Francis Bacon who said:

Wise men make more opportunities than they find

This rings true for IP. The breadth and depth of the relationship is impressive, covering a full range of policy exchanges and joint work on strategic global issues.

And the UK-China relationship is contributing to economic growth, jobs and prosperity in both our countries:

  • Chinese companies continue to invest more in the UK than in any other country in Europe. The most recent deals included a £1.2 billion investment in three major property projects in Manchester, Leeds and Sheffield by Hualing Industries. These projects are expected to create 18,000 jobs and 10,000 new homes as part of the Northern Powerhouse initiative;

  • UK exports of goods and services to China have almost doubled over the past 5 years. The State Visit is adding £30bn worth of deals including Chinese investment with Merlin Entertainment on the Shanghai Legoland. And we now have a new ambition to make China the UK’s second largest trading partner by 2025, as part of the government’s wider efforts to increase British exports to £1 trillion a year and get 100,000 more companies exporting; and

  • the “Newton Fund” is ensuring £200 million is invested in joint UK-China scientific research and innovation over the next 5 years

Importance of IP for economic growth

This impressive trade, investment and innovation relationship is underpinned by the IP regimes in our two countries.

The UK invests more each year in intangible assets than in fixed capital investment. And the creative industries alone account for over 5% of GDP in both the UK and China.

This shows that our modern economies depend on effective IP systems for continued growth. A strong IP system is essential in rewarding and incentivising both innovators and those that invest in them. I expect that participants in this symposium will not need persuading of this point.

And we are doing our bit here in the UK:

  • the UK was ranked top of the Taylor Wessing Global IP Index in 2013. We also ranked 2nd in the World Intellectual Property Office Global Innovation Index, which looks at the best places in the world to create, protect and enforce IP; and

  • the UK also has world-leading IP professional services companies. British attorneys have a reputation for quality and for representing their clients’ interests. I strongly recommend any Chinese companies here today take the opportunity to meet with our excellent IP professionals during your visit. This evening, the Chartered Institute of Patent Attorneys and the Institute of Trade Mark Attorneys will be hosting a reception at the Royal College of Surgeons for the UK attorneys and the UK’s top IP judges and I look forward to seeing many of you there. Please use this opportunity to meet with the UK’s IP professional services

UK-China IP cooperation

During his visit to China last month, the Chancellor George Osborne said that the UK is

China’s best partner in the West

This is certainly true of our intellectual property cooperation.

The UK recognises the progress China has made in developing its IP system, with the first modern intellectual property law passed just over 30 years ago. We are contributing to the progress in China’s IP system through constructive relationships with the central government, with rights holders and at provincial level across the country. And that is why I welcome the diversity and depth of the Chinese representatives present today.

Last year I led the largest ever UK IP delegation to China, including representatives from British companies, industry associations, the judiciary and senior government officials. We visited 8 cities in 5 days, and I met with 8 Chinese counterparts of Minister-level or above. Including a meeting in Zhongnanhai, with State Councillor Wang Yong.

Deliverable 1: Alibaba-CBBC outcomes

Particular progress was made helping British companies protect IP online in China. During my visit I supported the signing of a landmark IP agreement between the China-Britain Business Council and the Alibaba Group. Many of you know the significance of Alibaba. Their various platforms account for the majority of the booming Chinese e-commerce market. Sales on Alibaba platforms exceed the global sales of Amazon and eBay combined.

Since last September the CBBC-Alibaba IP agreement has gained momentum. It has led to a number of benefits for British companies – multinationals and SMEs, including:

  • a criminal enforcement campaign covering 6 Chinese provinces, which dismantled a network producing counterfeit engine lubricants. The network recorded sales of £1.5 million in the past year alone and was uncovered by a joint operation between Alibaba, British businesses and Chinese law enforcement;

  • upgrading Alibaba search filters to pre-emptively block copycat and infringing products from reaching consumers;

  • developing new, fast track processes to remove products which infringe patent and design rights; and

  • solving dozens of other thorny problems brought forward by British companies, including guiding small and medium-sized enterprises through “Ali-Protect”, Alibaba’s in-house IP protection system

I would like to congratulate Alibaba and the CBBC on these achievements. The Alibaba-CBBC IP agreement has improved the global e-commerce environment, making it safer for consumers and the small businesses that use Alibaba sites as part of their supply chain. In particular I would like to thank Alibaba for their constructive solutions to the IP concerns of British companies.

Of course, there is more to be done. We must ensure that the lessons learnt from these successes are incorporated into “business-as-usual” on Alibaba websites, including by:

  • streamlining notice-and-takedown procedures;
  • further enhancing pre-emptive filters to prevent criminal scale infringements from happening in the first place; and
  • smoother linking of on- and off-line enforcement

Alibaba are here today and will speak this afternoon on measures they are taking to achieve these goals. My officials both here and in China are ready to support the continued success of this project.

Another area where we are jointly tackling the challenges presented by the online environment is in copyright and the creative industries.

I am pleased to announce today the first set of research projects to be funded by the Digital Copyright and IP Law Research Centre, based in Nottingham University, Ningbo, China.

The Centre is jointly financed by the UK’s Arts and Humanities Research Council and the Ningbo local government, and aims to provide high-impact, practical research that informs China’s IP policy. Projects will be implemented by consortia of British and Chinese academics and will include input from our key creative industry sectors.

Topics to be covered over the next two years include:

  • IP regimes appropriate for Internet-based technologies and new business models;

  • 3D printing;

  • fair use of copyright in the digital domain; and

  • awareness of IP amongst design intensive industries, and work on how an IP regime can evolve to meet designers’ needs

I hope that many of you here today will be involved in these projects. Practical input from industry is crucial because the UK really is a global leader in the creative industries, punching well above its economic might. For example:

  • the British publishing industry recorded revenues of £4.3 billion in 2014, 40% of which came from exports;

  • UK-qualified film has an 11% share of global box office revenues; James Bond is as popular in China as in the UK; and UK TV programmes have devoted audiences in China. Both and Sherlock and Downton Abbey have 160 million viewers respectively. Which is more than the total population of the UK

  • the UK has a 14% share of the global music market, with 5 of the top ten best selling artists in the world in 2014 coming from the UK. Adele is one of the most popular karaoke choices in China

A strong copyright regime is part of the policy mix behind this success. At the start of last month we held a number of activities in China to showcase UK copyright expertise. This included some of our innovative approaches to enforcement. I was particularly pleased to learn that -partly as a result - from this October China will cut off advertising revenues flowing to websites that distribute pirate works.

Deliverable 3: UK-China Research and innovation toolkit

The final announcement I would like to make today is the publication of a toolkit to enable UK-China research and innovation collaboration.

The UK’s strengths in research and technology commercialisation complement the exciting work happening in China. For example:

  • the UK is home to 4 of the world’s top 10 universities – Cambridge, UCL, Oxford and Imperial College London – and 30 of the top 200

  • these universities are equipped with first class facilities and talent, producing research that changes people’s lives around the world. According to industry data, 16% of the most cited papers in the world are first published in the UK; and

  • the UK is also a world leader in technology commercialisation. We have strong university-industry links, and a track record of creating successful spin out companies. Our companies and universities have experience taking innovation to markets across the world

China is also now a leading global source of funding for scientific research, with R&D spending reaching 2.9% of GDP in 2014. Many of us in the IP sector have been amazed at the output of this research in China, with over 900,000 invention patent applications to the State Intellectual Property Office last year alone.

[As I mentioned earlier], the UK and China are jointly investing in £200 million of science and innovation projects over 5 years. But collaboration across borders can be challenging. Unfamiliar academic cultures, business environments and IP systems can create barriers to joint research.

The benefits of solving these problems are significant. Citation rates are higher for papers co-authored by British and Chinese scientists than for papers written in either country independently. Cross-border licensing of IP has unlocked revenues otherwise unavailable to both parties in a licensing agreement.

This is why the Toolkit we are launching today is so important. It provides a clear framework for negotiating how IP will be managed in joint research projects. It includes a decision guide and translated model collaboration agreements. It is based on the Lambert Toolkit which was created for domestic collaborations, but has been specifically adjusted for both UK and Chinese law.

I encourage you all to use this Toolkit and provide us with feedback on its effectiveness.

Ladies and gentlemen:

I have set the scene for this IP symposium and announced three UK-led initiatives to help businesses achieve better IP outcomes:

  • we are ensuring that e-commerce platforms sell fewer counterfeits through CBBC-Alibaba collaboration;
  • adapting copyright regimes to the digital age through the Digital Copyright and IP Law Research Centre at Nottingham-Ningbo; and
  • removing barriers to valuable collaborative research and innovation through our new IP toolkit

With our strong collaboration to date, we are working together to create an IP system that underpins this Golden Era of UK-China relations.

I want this Symposium to contribute to this process and yet more increased trade, investment and above all innovation in the future.

I wish you all the best for your discussions throughout today.

Thank you.

Published 21 October 2015