What’s Spurring Singapore’s Push to be a Global IP Hub
27 Apr 2021
By Dr Stanley Lai
Its world class judiciary and expanding suite of IP-related services give it the edge as it seeks new opportunities in an innovation-driven global economy.
The value of intangible assets (IA) made up 54% of the value of global listings, surpassing that of tangible assets, according to the Brand Finance Global Intangible Finance Tracker last year. IAs refer to assets that do not have physical properties and can include intellectual property (IP) like patents, copyrights, designs and trademarks; and non-IP intangibles include goodwill and publicity rights.
Singapore tech start-up PatSnap was in the news recently for achieving tech unicorn status after it raised more than US$400 million since 2007 and its valuation rose to more than US$1 billion. PatSnap is a research intelligence platform which provides patent information and research journals used by companies to make R&D investment decisions.
South-east Asia’s ride-hailing giant Grab also grabbed headlines recently as it announced plans to go through a merger that will value the company at US$39.6 billion, making this the world’s largest Special Purpose Acquisition Company (Spac) merger. Grab is a “super-app” which offers food delivery and digital payments, among other services, via a mobile app.
Pfizer and Moderna have been at the forefront of the battle against Covid-19 with their vaccines, which were developed, tested and rolled out in record time. These vaccines are key survival pillars in the battle against the pandemic.
All these companies represent a cohort of innovation-driven, IA/IP rich companies that are improving lives around the world. Innovation creates solutions for the world’s pressing problems, drives economic activity and creates jobs.
In an innovation-driven economy, IA/IP is as important to a billion-dollar tech or pharma company as it is to a student creating a new app, a scientist inventing a green technology, a musician composing a new song and even a country that is implementing a strategy of reinvention and exploring digital opportunities across all sectors.
But why? For starters, to reap the benefits of creation.
Rising Value of IA/IP:
The value of intangible assets (IA) made up 54% of the value of global listings, surpassing that of tangible assets.
Just as Rome was not built in a day, businesses and creators take time to establish their product or service, grow their customer base and build a brand. They need to protect their IA/IP from the get-go as insurance against others with similar ideas.
IA/IP can be protected in various ways. Patents and trademarks are two such examples.
Patents safeguard inventions. They can protect products, designs or processes that meet certain specifications. Once secured, the patent owner can protect his invention for up to 20 years without fear of others exploiting it.
During this time, the inventor can reap the benefits of his investments in his creation by creating and selling his invention or licensing it to someone else for a fee, among other things.
Brands are built over time and established through a company’s products, services and reputation. A company’s name and logo are the most visible parts of its brand. Well-established brand names such as Apple, Amazon and DBS Bank have spent years building their reputation. Their name and logo carry a lot of weight in securing customers and sales. Trademarks are registered to protect a company’s brand and ensure that others do not exploit it for commercial benefit.
Building on Inventions
Next, innovation breeds innovation. Moderna’s Covid-19 mRNA vaccines are injected into bodies and teach cells how to make a protein that triggers a response against the virus.
The first vaccine used in 1798 to build immunity against smallpox was administered by smearing a skin tear with cowpox.
Innovations and the supporting protective structure that undergirds them will in turn incentivise the creation of more IA/IP-based innovations.
Vaccines are just one of many examples of inventions that have improved over time as a result of innovations building on innovations.
Many of such inventions may not have seen the light of day had there not been a systematic way of organising and protecting these innovations.
Driving Economic Activity
Third, innovation is also an important driver of economic activity and jobs. For example, Google, which was later reorganised as Alphabet, started with only 300 employees in 2001 and their workforce grew to 114,000 by the end of 2019. From software engineers, to designers, to sales and marketing personnel, to suppliers, Alphabet is driving economic activity and jobs in many countries.
A survey published in April 2019 by Yahoo Finance showed the top five companies that created the greatest number of jobs in the United States from 2016 to 2019 were Apple (20,000), Amazon (11,000), Progressive (10,000), Google (7,000) and Fiat-Chrysler (6,500). Not surprisingly, the majority of the jobs were created by IA/IP-rich innovation driven companies.
Even in the midst of Covid-19 last year, data from the Intellectual Property Office of Singapore (IPOS) revealed that there was an encouraging increase in filings by local enterprises, which was likely driven by increased entrepreneurial activity in response to the pandemic.
Many new filings were in the retail and technology-related industries, possibly to cater to the needs and demands of local businesses and consumers. Notably, filings from the technology-related industry, together with the medical-related industry, experienced the fastest growth in 2020.
Promoting IA Growth
Singapore has been building its IP regime and capabilities over the past two decades. Since its establishment in 2001, IPOS has evolved from just being a registrar of IP to an agency that helps promote innovation and the growth of IA.
Today, IPOS and its partners also promote IP awareness and equip enterprises with the skills and knowledge to build IP capabilities.
IPOS has also been innovating on the service delivery front. Last year, during the pandemic, it launched an acceleration programme (SG IP Fast) for patents, and related trademarks and registered designs to help businesses bring their inventions, including Covid-19 related ones, to market within six months – the fastest in the world.
Acceleration Programmes to fast-track your ideas to market
It also offered a fully virtual hearing option and successfully conducted its first opposition hearing and mediation via video conference in June last year. The parties benefited from both time and cost savings, as a settlement was reached between the disputing parties without having to wait for the lockdown to ease.
Beyond the pandemic, the Government is looking to ensure that Singapore remains one of the world’s most innovative nations. Last year, Singapore retained its overall top ranking as Asia’s most innovative nation and eighth in the world in the Global Innovation Index (GII) released by the World Intellectual Property Organisation, Cornell University and global business school Insead. The GII ranks world economies according to their innovation capabilities.
Singapore's Global Innovation Rankings
The Singapore IP Strategy 2030 (SIPS 2030) that was announced on Monday (April 26) will position Singapore as a global hub for IA/IP activities to capture new opportunities.
It will help enterprises accelerate business growth as they tap on the unrealised potential of their IA/IP. Enterprises can look forward to enhanced IA/IP services and resources to make it easier and faster for them to protect and manage their IA/IP.
There are also plans to create a vibrant marketplace for IA/IP financing transactions by increasing transaction transparency, helping enterprises access financing using their IA/IP, and developing a credible and trusted valuation ecosystem.
As Singapore strengthens its IP regime, it will also establish more global links with countries to facilitate IP registration in other countries to help enterprises go global faster. Singapore will also leverage its strength as one of the leading cross-border dispute resolution centres in the world to strengthen its IP dispute resolution offerings.
Innovative ideas have been and will increasingly become the key drivers of future economies. The commercialisation opportunities of the future will also include seizing opportunities to assert and “weaponise” IP in order to achieve market equilibrium and effective valuation of IP for particular technologies or sectors.
For a country that has relied on innovation for its survival, Singapore will need to continue its relentless pursuit of innovation to tackle challenges like climate change and pandemics.
It will also need to create the right environment to enable local and global innovative enterprises to continually innovate and thrive in order to remain relevant to the world.
Singapore’s world class judiciary, together with its arbitration and mediation centres of excellence, are well placed to push forward its efforts to resolve disputes, as well as develop and advance IP law for decades to come.
This is why innovation, intangible assets and IP matter.
This article was written by Dr Stanley Lai for the Straits Times Opinion and was published on 27 April 2021. Dr Stanley Lai is chairman of IPOS and head of IP & technology at law firm Allen & Gledhill.