Chapter 1: Introduction
The important role of the IP system in Australia’s economy is better recognised every year as the evidence base on the impacts of IP grows. IP rights provide an incentive for businesses to invest in innovative and entrepreneurial activity, which contributes to productivity growth. Filings from international applicants represent a critical feature of our economy and support foreign investments in our market. Australia has long imported foreign capital, including technology, to grow its economy at a faster rate than reliance on its domestic resources would otherwise allow.
In 2019, growth in the world’s advanced economies slowed noticeably in 9 out of 10 major international markets.(2)End note 2. IMF World Economic Outlook, January 2020. https://www.imf.org/en/Publications/WEO/ Issues/2020/01/20/weo-update-january2020, accessed 19 February 2020. The impact of this global slowdown has been felt throughout the Australian economy, as world output growth fell from 3.6 per cent in 2018 to an estimated 2.9 per cent in 2019 and international businesses filed fewer IP rights in Australia overall than in 2018.
The IP Report provides the latest data on the IP rights administered by IP Australia. Patents (Chapter 2) provide an incentive for the production and commercialisation of new knowledge, which affects the rate and direction of technological progress as well as its diffusion throughout the economy. Trade marks (Chapter 3) are a vehicle for businesses to legally protect their brands by which they differentiate themselves in the marketplace. Design rights (Chapter 4) are less widely used in the Australian economy but are important for innovation in certain industries, particularly those in global value chains. Plant breeder’s rights (Chapter 5) can encourage innovation in agriculture, for example by giving protection to the breeding of drought-resistant crop varieties.
In 2019, patent applications filed at IP Australia remained relatively steady overall, although trade mark applications fell by five per cent year on year. The latest available international data, however, confirms that 2018 was a record year for Australians filing IP rights overseas.(3)End note 3. See https://www3.wipo.int/ipstats/. The total number of patent applications filed overseas by Australian applicants grew three per cent in 2018 while trade mark applications grew six per cent year on year.
Our theme for this year’s report is the digital economy, which is synonymous with information and communication technology (ICT). Research on the digital economy is still emerging in Australia and its interaction with the IP system is a fertile topic for future research. In Chapter 6, we analyse filings in ICT-related patents, trade marks and designs at IP Australia by the leading countries of origin and examine trends over the past decade.
Chapter 7 summarises IP Australia’s first longitudinal research project which examines micro data to assess the impact of IP rights on Australian businesses’ profitability and on market competition. We find that ownership of patents, trade marks and designs is strongly and positively associated with firm profitability. Our research also finds no significant impact overall of IP rights on market concentration or competition in Australia, suggesting that the system serves its purpose in incentivising innovation without dampening competition.
Accompanying this eighth edition of the Australian IP Report, we are again publishing the digital report that offers interactive data visualisations for readers to dive deeper into Australia’s IP data. Our aim with the Australian IP Report is to stimulate public discussion on IP trends and their significance for Australia. This report is as much a forum for engagement as a factual presentation of the latest statistics, so we welcome your feedback, suggestions and questions.