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Economy, No.32  Jun. 5, 2016

The Making of an Intellectual Property-based Nation

Japan’s latest Intellectual Property Promotion Plan spells out the government’s determination to promote the utilization of regional intellectual property to support SMEs and to reduce and more efficiently resolve rights disputes.

In July 2002, the Japanese government drew up an Intellectual Property Policy Outline with a view to making Japan an “intellectual property-based nation.” The policy placed a strategic emphasis on innovation and “the creation of valuable information” such as technology, design and content. The following July, the newly established Intellectual Property Strategy Headquarters announced the first Strategic Program for the Creation, Protect ion and Exploitation of Intellectual Property, explaining the background to the Program as follows:

Source: Global HABIT (Hakuhodo Audience and Brand-User’s Index for Targeting) Report 2015, Hakuhodo, Inc.

There are various factors behind the significant decline recently in the international competitiveness of Japanese industry, which had held the top rank in the world until the beginning of the 1990s. One of these factors is that Japan has been content with its old-style industrial system as a result of past successes and has failed to drastically reform the conventional “Japanese model” amid the rapid changes in the environment in recent years.

The notion of a “knowledge-based” or “intellectual property-based” economy was a novel one at the time for a nation which for so long had considered itself “manufacturing-based.” Nevertheless, the nation’s pursuit of five basic intellectual property (IP) strategies began in earnest: (1) Promotion of the creation of IP (in particular at universities and public research institutes; (2) Strengthening the protection of IP; (3) Support for the strategic exploitation of IP; (4) Dramatic expansion of the content business, and (5) Developing human resources and improving public awareness.

Source: Global HABIT (Hakuhodo Audience and Brand-User’s Index for Targeting) Report 2015, Hakuhodo, Inc.

To promote innovation and the creation of original content and so as to utilize such resources for economic growth, the government spelled out a series of targets under each of the five strategies, these inclu

ding rights protection. The Intellectual Property Strategy Headquarters has since revised these policies and targets on an annual basis, and on 19 June 2015 announced the latest Intellectual Property Promotion Plan to receive Cabinet approval.

Intellectual Property Promotion Plan 2015

The three pillars of the Intellectual Property Promotion Plan 2015 are (1) Promoting the utilization of regional intellectual property; (2) Creating a public-private collaboration platform, and (3) Enhancing the system for settlement of intellectual property disputes.

Announcing the Plan, Prime Minister Abe summarized the government’s intentions as follows:

We will advance the “program for promoting the utilization of regional intellectual property” in order to strengthen the intellectual property strategies of small- and medium-sized companies in the regions, and to bolster collaborations with large companies and universities. Additionally, we will create a “public-private collaboration platform” for matching ambitious enterprises, so that Japan’s content industries and peripheral industries can work together across different sectors to promote business overseas. With this as a focus, I hope the public and private sectors will collaborate and promote the Cool Japan strategy even further.

“Cool Japan” refers to content such as manga, anime, music and fashion, the “soft” power of which in a regional context can be gauged from the accompanying figures.

The acquisit ion and protection of IP rights is of vital importance to Japan’s small- and medium-

sized enterprises. SMEs account for some 99.7 percent of all Japanese companies, but currently only around 330,000 out of Japan’s 3.85 million SMEs have obtained intellectual property rights on their technologies. The new Intellectual Property Promotion Plan spells out strategies to assist SMEs in the acquisition of rights and to reduce and resolve IP disputes. Prime Minister Abe stated:

We will advance comprehensive discussions on matters such as the most appropriate procedures for collecting evidence and compensation for legal damages, as part of our efforts to enhance the functionality of Japan’s intellectual property conflict management system. Furthermore, we will thoroughly discuss issues such as the most appropriate legal systems, including the maintenance of a Copyright Act that is suited to the digital network age in which we see the spread of technologies such as artificial intelligence and 3D printing.

In a separate initiative, new protection measures have also been applied to the agriculture, forestry and fisheries sector with the implementation in June 2015 of the Geographical Indication (GI) Act. The GI Act protects the names of regional brand products that meet specific quality standards as intellectual property, thereby protecting the interests of producers — and consumers — in domestic and overseas markets. A GI mark can now be affixed to a registered GI product proving that it is genuine and has characteristics that are attributable to its production area.

Concluding his announcement of the Intellectual Property Promotion Plan 2015, Prime Minister Abe stated:

I would like the Government to work together as one to promote our intellectual property strategy, so that we can make full use of Japan’s intellectual property, including our advanced technology and rich cultural content; raise our international competitiveness; and secure growth.

Translated from an original article in Japanese written forDiscuss Japan. [December 2015]