INTELLECTUAL PROPERTY DISPUTES IN ASIA AND THE ALLURE OF ARBITRATION

The growth of intellectual property rights in Asia has been prolific. Since 2009, East Asia has overtaken both North America and Western Europe in the number of applications filed under the Patent Cooperation Treaty. In 2012, Asian countries filed 78,800 patent applications, significantly more than Europe and North America, which filed 57,904 and 53,955 applications, respectively. This growth has, somewhat inevitably, corresponded with an increase in the number of intellectual property disputes arising in Asia. Statistics released by the Supreme Court of China in its 2012 ‘White Paper on Intellectual Property Rights Protection’ indicated a 46 percent increase in the number of intellectual property related civil disputes received by the Court from the previous year.

While matters continue to be commenced in the domestic courts of various jurisdictions, many have followed the allure of arbitration. This has included high profile disputes such as American Superconductor Corporation’s US$1.2bn claims against Sinovel, one of the largest Chinese wind turbine manufacturers, for breach of contract and infringement of intellectual property rights. The reason for this gravitation towards arbitration is plain; arbitration offers many advantages to commercial parties that court litigation cannot.

 Advantages of arbitration

One of the most significant advantages of arbitration is its ability to more readily accommodate the international nature of intellectual property rights. Intellectual property is embedded in a vast array of commercial products that travel rapidly and seamlessly across borders in an increasingly globalised marketplace. This can result in the potential for intellectual property disputes to arise in multiple jurisdictions and be governed by multiple sets of laws. While this creates a complex situation for parties wishing to litigate in domestic courts, arbitration on the other hand provides parties with the autonomy to select a neutral forum for the resolution of their dispute which will be governed by the law of their choice. A further beneficial by-product is that parties also benefit from a sense of impartiality that results from the fact that their dispute will not be determined within the judicial system of a jurisdiction in which one party resides.

Jan-Mar 2014 issue

HKIAC