Strengthening Intellectual Property Capabilities to Boost Corporate Competitiveness

Last year, Korea Hydro & Nuclear Power (KHNP) and Korea Electric Power Corporation (KEPCO) were sued by the U.S. company Westinghouse, raising the possibility of a serious setback for South Korea’s nuclear power plant exports. The dispute originated from an intellectual property issue. Westinghouse claims intellectual property rights, while Korea maintains that the matter was already settled in the past and poses no problem. Given the potential future impact on actual nuclear power exports and Korea’s nuclear technology capabilities, now is the time for a more careful and nuanced approach.

More recently, a U.S. jury returned a verdict that Samsung Electronics should pay about 400 billion won in damages for semiconductor patent infringement. A final ruling is expected to take around six months, and Samsung is exposed to the risk of substantial compensation in the U.S. litigation. In this way, large and small intellectual property issues are having a major impact on the corporate economy and industry alike.

This year, KHNP and KEPCO reportedly filed a motion in a U.S. court to compel arbitration in response to Westinghouse’s U.S. lawsuit. Through arbitration, they are seeking to resolve problems that could arise in future international nuclear power export projects. Interest has grown further because the ongoing nuclear power project export to Poland also depends on the outcome.

There is also encouraging news that during President Yoon Suk Yeol’s state visit to the United States in April, the two governments agreed to work together for a swift resolution of the litigation with Westinghouse over ownership of nuclear technology. As this lawsuit could adversely affect Korea’s nuclear exports, both governments reportedly intend to resolve the legal dispute. This reflects an economic environment in which the importance of intellectual property rights is being emphasized more than ever.

Intellectual property rights are a broad concept encompassing patents, trademarks, designs, and more. Article 22 of the Constitution stipulates that the rights of authors, inventors, scientists, technicians, and artists shall be protected by law. Intellectual property rights play an important role in protecting innovation and creativity and converting them into economic value. In particular, intellectual property is known to be critically important in connection with science powerhouses and sectors such as biotechnology and the semiconductor industry. As Korea seeks to become a scientific and economic powerhouse, it needs greater attention to intellectual property rights and more proactive responses.

The National Intellectual Property Committee has launched a special committee on intellectual property litigation, operated with the participation of 15 private-sector members recommended by academia, the legal community, and industry, along with government officials from the Office for Government Policy Coordination, the Ministry of Justice, the Ministry of Culture, Sports and Tourism, and the Korean Intellectual Property Office. In February, the head of WIPO (World Intellectual Property Organization), which oversees the international intellectual property order, also visited Korea. Both domestically and globally, this is a time of growing interest in intellectual property rights.

In the United States, the John Young Report in the 1980s already emphasized intellectual property rights as one way to strengthen industrial competitiveness, proposing legal, international, and technological responses. Since then, the U.S. has developed a variety of institutions and systems to protect intellectual property rights. Japan, for its part, made its “Declaration of Nation-Building Through Intellectual Property” in April 2002 under Prime Minister Koizumi, recognizing that it had fallen behind advanced countries such as the United States and Europe in the field of intellectual property, and has since advanced toward becoming a global intellectual property leader through expert training, R&D promotion, and other efforts.

At a time when intellectual property rights are becoming more important worldwide, Korea too should prepare by declaring this the “first year of nation-building through intellectual property,” so that it can cultivate outstanding private-sector talent in each industry and build international competitiveness. I hope Korea will improve systems, including unreasonable regulations, and take the lead at this critical juncture where intellectual property rights also play a major role in trade, thereby strengthening market competitiveness.

The government must respond proactively to the intellectual property-related policies and support measures being developed around the world. As the impact of intellectual property rights on the market economy continues to expand across scales and industries, the importance of a control tower capable of coordinating interagency cooperation, legal support, arbitration, and strategic responses at the national level appears greater than ever.

Strengthening intellectual property rights is the way to strengthen corporate competitiveness, and it will become a driving force in leading and shaping future industries. Now is the time to secure a world-class intellectual property foundation through fierce private-sector market competition while also preparing deeply considered national-level strategic response measures.

Heonseok Lee, Head of External Cooperation Division, Center for Free Enterprise (CFE)

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Original title: 지적재산권 역량 강화로 기업 경쟁력 높여야

Author: Heon-seok Lee

Date: 2023-06-09

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=press&idx=25709