Global Intellectual Property Center

Scramble for funds in a harsh climate

Scramble for funds in a harsh climate

Financial Times
Nearly six months ago in Copenhagen, at the biggest summit ever held on climate change, world leaders failed to come to a comprehensive agreement on greenhouse gas emissions. But what did emerge was an agreement by which the biggest economies – developed and developing – all pledged to curb their emissions, by varying degrees, over the next decade.

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If investment in green technology does continue, that would mean new questions over intellectual property, says Mark Esper, executive vice-president of the US Chamber of Commerce’s Global Intellectual Property Centre.

“Many green technologies are very IP-intensive,” he says. “A significant amount of research and development is put into turning an idea into a product that will improve energy efficiency, reduce harmful emissions, and help us preserve our environment.”

This is good news for jobs, Mr Esper says. The US Chamber of Commerce released a study in April showing that IP-intensive industries “create jobs, pay their workers higher wages, generate more exports, help reduce the deficit, and drive economic growth in a variety of sectors compared with non-IP-intensive industries”.

It also found “IP-intensive industries employ workers of all educational backgrounds and skill levels, creating white- and blue-collar jobs that pay better and are growing faster”.

But one of the crucial conditions for such industries is a strong legal framework to protect IP, says Mr Esper. “Without the protections that patents provide, many of these entrepreneurs – and the investors who support them – would not commit the time, effort, and capital to pursue their ideas if others are free to steal their inventions.”

This is particularly important in relation to climate change, because a key sticking point in long-running international negotiations has been over IP. For years developing countries including China and India have sought access to IP from the developed world as part of a deal. Developed countries refused.
In the run-up to the Copenhagen summit, developing countries seemed to be softening these demands, downgrading “technology transfer” to “technology collaboration”. In other words, instead of free access to patents, a commitment to helping private companies from the industrialised world invest in developing countries.

But as the talks floundered, developing countries were less willing to compromise. As the talks resume, developed-country negotiators are hoping the old argument is not reopened.

Mr Esper said a study from his organisation last year had found that, if green IP rights were weakened to accommodate demands from some developing countries, companies would be reluctant to invest and the US could lose up to 1m jobs by 2020. As investors look beyond the recession, he concludes: “Strong IP rights are essential.”

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