1. Jae-Hong Baek Deputy Director Technical Cooperation Division
Korean National Experience on Building Intellectual Property Awareness and Capacity of Small and Medium-sized Enterprises
July 30, 2008
Good morning.
My name is Jae-hong Baek.
I am deputy director of KIPO.
I will talk about the Korean National Experience on Building Intellectual Property Awareness and Capacity of SMEs.
Jae-Hong Baek
Deputy Director
Technical Cooperation Division
Korean Intellectual Property Office

2. Contents I. Importance of IP in the Knowledge-Based Society
II. Current Status of Korea in the IP Field
III. Enhancement of IP Awareness and Capacity of Small and Medium-sized Enterprises
IV. Conclusion
My presentation is divided into four parts.

3. Korea : Past and Present
1957
2007
GDP Per Capita : $ 74
Exports : $ 22 million
Patent filings : 469
Lack of provisions, food
GDP Per Capita : $ 20,060
Exports : $ 371,489 million
Patent filings : 171,731
Techno-intensive Industry
- IT products, mobile phone, semiconductor, car etc.
Ship-building : No.1
50 years ago, GDP per Capita of Korea was only 74 dollars and the number of patent filings are only 469.
At that time, because of Korean War in 1950, Korea lacks of provisions and food.
However, during 50 years since 1957, GDP per Capita of Korea has increased to 20,060$ and the number of patent filings has increased to 171,731.
Nowadays, Korea is leading the world in the techno-intensive industries, ie, IT products, mobile phone, semiconductor, car, etc.
Especially, Korea is No. 1 in the field of ship-building.

4. I. Importance of IP in the knowledge-Based Society
Rapid Change from an Industrial Society to a
Knowledge-Based Society
The development and securing of new innovative technologies, including IT, BT, and NT, are sources for creating national wealth,  not just a means of acquiring wealth.
* Price per gram : Gold $ 35, interferon (anticancer drug) $ 5,000
EPO (medication for anemia) $ 670,000
Traditional industry should be converted into high value-added
industry in order to survive and succeed in the global market.
We are on the process of rapid change from an Industrial society to a knowledge-based society.
The development and securing of new innovative technologies, including IT, BT, and NT, are sources for creating national wealth, not just a means of acquiring wealth.
For example, the price per gram for the medication for anemia is 19,000 times greater than that of gold.
Traditional industry should be converted into high value-added industry in order to survive and succeed in the global market.

5. I. Importance of IP in the knowledge-Based Society
IPRs : Sources of Wealth and Competition
Patents and trademarks can create enormous property value and high added value.
Knowledge and ideas have become sources of wealth and strong competitiveness through the monopolistic and
exclusive nature of intellectual property rights.
* Vast royalty and sales revenue has been generated from licenses or
the transfer of rights.
* In the US, a powerful IP country, more than 50% of exports  are directly
related to intellectual property rights.
IPRs is the sources of wealth and competition.
Patents and trademarks can create enormous property value and high added value.
Knowledge and ideas have become sources of wealth and strong competitiveness through the monopolistic and exclusive nature of intellectual property rights.
For example, in the US, a powerful IP country, more than 50% of exports are directly related to intellectual property rights.

6. I. Importance of IP in the knowledge-Based Society
Promotion of Continuous Technological Innovation
Without an IPR protection system, entrepreneurs would avoid investing in technological innovation and R&D, which require long-term investment of a large amount of capital. The lack of investment results in a loss of creativity.
Inducement of Foreign Direct Investment and
Technology Transfer
IPRs can promote continuous technological innovation.
That is, without an IPR protection system, entrepreneurs would avoid investing in technological innovation and R&D, which require long-term investment of a large amount of capital.
The lack of investment results in a loss of creativity.
IPRs can also induce foreign direct investment and technology transfer.
That is, foreign enterprises that possess advanced technologies can be induced to make a direct investment and transfer their technologies to a country where IPRs are properly protected.
Foreign enterprises that possess advanced technologies can be induced to make a direct investment and transfer their technologies to a country where IPRs are properly protected.

7. I. Importance of IP in the knowledge-Based Society
Virtuous Cycle of Intellectual Property
Acquisition of
IP Rights
Commercialization
& Transfer of patents
Speedy &
Correct examination
Creation
of IP
Exploitation
& Protection of IPR
The virtuous cycle of IP consists of creation of IP, acquisition of IPRs, and exploitation & protection of IPR as shown in this slide.
The creation of IP results in the acquisition of IPRs through the speedy & correct examination.
The acquisition of IPRs in turn results in the exploitation & protection of IPR through the commercialization & transfer of patents.
Lastly, the exploitation & protection of IPR results in the creation of IP through the financing and these steps complete the virtuous cycle of IP.
Financing

8. Ⅱ. Current Status of Korea in the IP Field
Top 20 Offices of
Patent Filings in 2005
Source :
WIPO Statistics Database
Next, I will talk about the current status of Korea in the IP field.
In 2005, Korea ranked No.4 in the world in terms of the number of patent filings.

9. Ⅱ. Current Status of Korea in the IP Field
Patent Filings
by Residents in 2005
Source :
WIPO Statistics Database
In terms of the number of patent filings by residents, Korea is No.3 in the world.

10. Ⅱ. Current Status of Korea in the IP Field
Resident Patent Filings
per Million Population
in 2005
(Korea : 2,530 Ranking 2 )
Source :
WIPO Statistics Database
In terms of the number of patent filings per population, Korea is No.2 in the world.

11. Ⅱ. Current Status of Korea in the IP Field
Resident Patent Filings per Billion dollars GDP (Korea : 129 Ranking 1)
Source : WIPO Statistics Database
and World Bank-World
Development Indicators
In terms of the number of resident patent filings per GDP, Korea is No.1 in the world.

12. Ⅱ. Current Status of Korea in the IP Field
Resident Patent Filings
per Million $ R&D
Expenditures
(Korea : Ranking 1)
Source :
WIPO Statistics Database
In terms of the number of resident patent filings per R&D expenditures, Korea is No.1 in the world, too.

13. Ⅱ. Current Status of Korea in the IP Field
Patents Granted
by Office in 2005
(Korea Ranking 3)
Source :
WIPO Statistics Database
In terms of the number of granted patents, Korea is No.3 in the world.

14. Ⅱ. Current Status of Korea in the IP Field
Patents Granted
by Country
of Origin in 2005
Source :
WIPO Statistics Database
In terms of the number of granted patents by country of origin, Korea is No.3 in the world.

15. Ⅱ. Current Status of Korea in the IP Field
In terms of the number of PCT international applications, Korea is No.4 in the world, in 2007.

16. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
2. Support for Creating Intellectual Property
3. Support for Exploiting Intellectual Property
Now, I will talk about Korean National Experience on enhancing IP awareness and Capacity of SMEs.
4. Support for Protecting Intellectual Property

17. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
2. Support for Creating Intellectual Property
3. Support for Exploiting Intellectual Property
First, I will introduce you the consultation, education and training for SMEs in Korea.
4. Support for Protecting Intellectual Property

18. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
Comprehensive Consultation for Local SMEs
29 local IP Centers were set up nationwide, which provide local SMEs with IP consultations, patent information services and educational programs.
KIPO cooperates with 13 metropolitan local governments to enhance IP awareness of local SMEs.
Conducts projects for improving and protecting the value of local brands by registering them as collective marks.
Provides the local governments with consultations on the strategies of promoting local brand.
KIPO is making a comprehensive consultation for local SMEs.
29 local IP centers were set up nationwide, which provide local SMEs with IP consultations, patent information services and educational programs.
Additionally, KIPO cooperated with local governments to enhance IP awareness of local SMEs.
For example, KIPO conducts projects for improving and protecting the value of local brands by registering them as collective marks.
And KIPO provides the local governments with consultations on the strategies of promoting local brand.

19. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
Nurturing of “Star Companies”
Select several SMEs from each metropolitan local area (or province), which have made good quality inventions
Provide them with comprehensive support including patent information services, consultations and support for patent filing
“Star Companies” are nurtured for the purpose of leading the local industry.
Star companies, which have made good quality inventions, are nurtured for the purpose of leading the local industry by KIPO.
KIPO provides Star companies with comprehensive support including patent information services, consultations, and support for patent filing.

20. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
Customized IP Consultations
KIPO’s examiners visit SMEs on request to provide customized consultations on IP
Consultations include diagnosis of IP management and advice on how to search for prior art and how to prepare a good patent application (in terms of description or drawings and claims).
KIPO provides customized IP consultations.
KIPO’s examiners visit SMEs on request to provide customized consultations on IP.
Consultations include diagnosis of IP management and advice on how to search for prior art and how to prepare a good patent application.

21. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
Public Patent Attorneys Center
KIPO runs “ the Public Patent Attorneys Center” in conjunction with the Korean Patent Attorneys Association (KPAA).
The center offers free IP consultations to individual inventors and small enterprises.
KIPO runs the public patent attorneys center.
The center offers free IP consultations to individual inventors and small enterprises.

22. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
IP Education and Training
KIPO set up an IP training center, called the International Intellectual Property Training Institute (IIPTI) in 1987.
The IIPTI offers systematic education for KIPO’s staff and the private sector, including SMEs.
Several IP training courses are designed for international participants.
KIPO set up an IP training center, called the International Intellectual Property Training Institute (IIPTI) in 1987.
The IIPTI offers systematic education for KIPO’s staff and the private sector, including SMEs.
The IIPTI also offers several IP training courses designed for international prarticipants.

23. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
Customized Cyber Education
KIPO is running the “Cyber IP Academy”, which provides SMEs with free customized IP training courses.
Cyber education is one way of enhancing IP capability of SMEs.
KIPO is running the Cyber IP Academy, which provides SMEs with free customized IP training courses.

24. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
2. Support for Creating Intellectual Property
3. Support for Exploiting Intellectual Property
KIPO provides SMEs with support for creating Intellectual property.
4. Support for Protecting Intellectual Property

25. III. Enhancement of IP Awareness and Capacity of SMEs
2. Support for Creating Intellectual Property
Patent Fee Exemption
KIPO offers SMEs a 50~70% exemption of patent fees to facilitate patenting activities.
Small companies : 70% exemption
Medium-sized companies : 50% exemption
Disabled inventors : 100% exemption
KIPO offers SMEs a 50~70% exemption of patent fees to facilitate patenting activities.
For small companies, we offers 70% exemption.
For medium-sized companies, 50% exemption.
For disabled inventors, 100% exemption.

26. III. Enhancement of IP Awareness and Capacity of SMEs
2. Support for Creating Intellectual Property
Expansion of the ‘Reward System for Employee Inventions’
Most inventions are created by employees working in companies and research institutes.
In 2006, 83.7% of patent applications were filed by legal entities; they are regarded as employee inventions.
To expand the infrastructure for creating IP, it is essential to fairly reward employees for their inventive activities.
KIPO is expanding the reward system for employee inventions.
Most inventions are created by employees working in companies and research institutes.
In 2006, 83.7% of patent applications were filed by legal entities, which are regarded as employee inventions.
To expand the infrastructure for creating IP, it is essential to fairly reward employees for their inventive activities.

27. III. Enhancement of IP Awareness and Capacity of SMEs
2. Support for Creating Intellectual Property
Support for Filing Patents Overseas
SMEs are given financial support to file more patent applications overseas.
Max. four million Korean won per filing
Up to three filings per enterprise
The invention should meet the good-quality requirements.
SMEs are given financial support to file more patent applications overseas.
Maximum is four million Korean won (about four thousand US dollars) per filing.
And each enterprise is allowed to get financial support to a maximum of three filings.
It is, however, necessary for the invention to meet the good-quality requirements.

28. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
2. Support for Creating Intellectual Property
3. Support for Exploiting Intellectual Property
KIPO also provides SMEs with support for exploiting intellectual property.
4. Support for Protecting Intellectual Property

29. III. Enhancement of IP Awareness and Capacity of SMEs
3. Support for Exploiting Intellectual Property
Background
Inventive activities boost the national economy only when the patented technology is eventually used.
Only a minority of patented technologies are commercialized.
In 2006, only 37% of patents or utility models were commercialized.
Only 20% of them achieved commercial success.
Inventive activities boost national economy only when the patented technology is eventually used.
But only a minority of patented technologies are commercialized.
For example, in 2006, only 37% of patents or utility models were commercialized in Korea.
And only 20% of them achieved commercial success.

30. III. Enhancement of IP Awareness and Capacity of SMEs
3. Support for Exploiting Intellectual Property
The “Council for Commercialization of Patented
Technologies” was set up in 1999.
The council consists of three governmental bodies:
KIPO, Ministry of Knowledge Economy, and SME Administration.
It coordinates and implements various ministerial support programs for the commercialization of patented technologies.
To provide the support for exploiting IP, the council for commercialization of patented technologies was set up in 1999.
The council consists of three governmental bodies: KIPO, Ministry of Knowledge Economy, and SME administration.
And it coordinates and implements various ministerial support programs for the commercialization of patented technologies.

31. Support for E-commerce of Patented Products of Good Quality
III. Enhancement of IP Awareness and Capacity of SMEs
3. Support for Exploiting Intellectual Property
Support for E-commerce of Patented Products of Good Quality
We set up an internet shopping mall ( for the sale of patented products made by SMEs.
KIPO provides the support for E-commerce of patented products of good quality.
KIPO set up an internet shopping mall (the address is for the sale of patented products made by SMEs.

32. III. Enhancement of IP Awareness and Capacity of SMEs
3. Support for Exploiting Intellectual Property
Recommendation of Patented Products of Good Quality for Government Procurement
Good inventions are recommended to the central government, local governments and state-run agencies.
Recommended patented goods can receive preferential treatment in government procurement.
Good inventions are recommended to the governments and state-run agencies for government procurement.
Recommended patented goods can receive preferential treatment in government procurement.

33. III. Enhancement of IP Awareness and Capacity of SMEs
3. Support for Exploiting Intellectual Property
Awards for Excellent Inventions
50 SMEs are nominated for their excellent inventions twice a year.
The nominees receive a government award.
Winners can display their invention in a free booth at an invention exhibition.
KIPO grants awards for excellent inventions.
50 SMEs are nominated for their excellent inventions twice a year.
Winners are entitled to display their invention in a free booth at an invention exhibition.

34. III. Enhancement of IP Awareness and Capacity of SMEs
3. Support for Exploiting Intellectual Property
Support for the valuation of Patented Technologies
Max. 80% of the valuation cost are subsidized, not exceeding 30 million Korean won per enterprise.
The Internet IP Mart was set up for the Transfer of
Patented Technologies ( .
The IP-Mart promotes the transfer of patented technologies by connecting suppliers with demanders.
Anybody can search online for a desired technology in the website containing a database of 52,000 patents.
KIPO provides the support for the valuation of patented technologies.
Maximum 80% of the valuation cost are subsidized, not exceeding 30 million Korean won (30 thousand US dollars) per enterprise.
And KIPO set up the internet IP mart for the transfer of patented technologies. (website address is www. ipmart.or.kr)
The IP mart promotes the transfer of patented technologies by connecting suppliers with demanders.
Anybody can search online for a desired technology in the website containing a database of 52,000 patents.

35. III. Enhancement of IP Awareness and Capacity of SMEs
3. Support for Exploiting Intellectual Property
An Off-line IP-Mart was established to Promote Sales of Patented Goods and Technologies.
It facilitates exhibitions and advertizing of patented products and technologies.
It offers professional consultants on the transfer of patented technologies.
KIPO also established an off-line IP mart to promote sales of patented goods and technologies.
It facilitates exhibitions and advertizing of patented products and technologies.
It also offers professional consultations on the transfer of patented technologies.

36. III. Enhancement of IP Awareness and Capacity of SMEs
1. Consultation, Education and Training
2. Support for Creating Intellectual Property
3. Support for Exploiting Intellectual Property
4. Support for Protecting Intellectual Property
KIPO also provides the free consultations on IPR infringements.

37. III. Enhancement of IP Awareness and Capacity of SMEs
4. Support for Protecting Intellectual Property
Free Consultations on IPR Infringements
KIPO provides SMEs with free-of-charge consultations on IPR infringements in cooperation with the Korea Patent Attorneys Association (KPAA).
KIPO also assists SMEs by offering a patent map on patent infringements. The patent map helps SMEs cope with patent infringements overseas.
KIPO provides SMEs with free-of-charge consultations on IPR infringements.
KIPO also assists SMEs by offering a patent map on patent infringements.
The patent map helps SMEs cope with patent infringements overseas.

38. IV. Conclusion I wish your country success and prosperity!
A strong IP policy can attract foreign direct investment from abroad and stimulate inventive activities at home, thereby boosting the development of the nation’s industry and economy. Close cooperation between the government and industry is crucial for promoting invention and innovation.
Korea was one of the poorest countries in the world in 1950’s. In just 50 years, Korea is now on the threshold of becoming an advanced country. Many factors, such as foreign investment and successful economic policies have contributed to Korea’s success. The key factor, however, is human resources with creativity and their sweat on the brow.
I wish your country success and prosperity!
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39. Thank you! Jae-hong Baek tultuly100@kipo.go.kr
Thank you very much for your attention.