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Russian Companies Suffer a Patent Crisis

Source: Grill IP patents news


The statistics are startling. Among the Top 10 countries leading the field of space technology, Russia weighs in at number 5, according to a new ranking published by Thomson Reuters. Roscosmos, the Russian Federal Space Agency, describes it as taking “the honorable fifth place”. Three decades ago, in Soviet times, Russia could claim the number one or number two spot in the field. How the mighty have fallen… except on closer examination, Russian scientists continue to develop leading space technologies. The problem: they fail to publish and patent their achievements. The “reward” is a meagre fifth place in the rankings.

Take the oil sector, where the Russian company Tatneft has managed to make it into the Top 10, thanks to its patents for new methods of fossil fuel extraction. The authorities once again speak of an “honorable” achievement. They give the impression as if Russia is catching up and will soon overtake its peers. Maybe, but during Soviet times the country was a leader in this field too!

We’ve heard of “catch up and overtake” before, starting in the 1930s, when Soviet Russia set itself on a decades-long path of breakthroughs in science and technology. Underpinning these achievements was a robust system of intellectual property protection.

And today? Technological leadership is achieved in a few of the country’s traditional niches, but there is hardly any real support for or interest in protecting the intellectual property of the country’s innovators.

Western companies don’t make this mistake. Thanks to the Eurasian Patent Register, they are making their mark in the patent landscape of Russia and other CIS countries.

Take Lightbridge, a US company that secured several patents in the Eurasia region for its innovations in manufacturing plutonium fuel rods. US media described the patents as a breakthrough as the company tries to enter the Russian market for nuclear power.

And so it is. Patents are documents when striking deals and choosing business partners. Yuriy Kuznetsov, a patent expert, said: “The most terrible sanction for us could be, for example, if leading foreign countries said to their companies: ‘You should patent everything possible in Russia, we will give you money or benefits for this purpose.’ After that, it would be impossible to market a new domestic high-tech product without violating a patent of a foreign company. “

It’s an insight that most Russian companies seem to ignore. Take Nizhny Tagil Metallurgical Plant (NTPM), one of the world’s leaders in processing titanium products. Last year alone, NTMP registered in Russia about 200 certificates of invention, but could be bothered to secure a mere 2 patents. The company’s management claims that all these innovations have helped to save a lot of money, but claims that it can’t secure patents to protect its innovation because the procedure of protecting NTMP’s intellectual property around the world would be too expensive.

This is an argument, though, has to be taken with a very large grain of salt. NTMP’s huge revenues and profits dwarf any cost of obtaining patent protection in the United States. The company’s management clearly seems to believe that it is better to save a little bit of money now rather than plan to earn a lot in the future.

Ultimately, Russia has not much of a patent program to speak of, and all-too-many companies fail to realize how much they lose out by failing to protect their stream of innovation.

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Author: grill-ip

Grill IP is a non-profit project for educational and entertaining purposes only. Our aim is to provide quick and easy access to aggregated and original patent news, IP analysis, interesting business cases in IP, basic legal updates and a list of patent transactions.

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