Empowering innovation and paving the way for growth: key IP reforms in Hong Kong's 2024 policy address
Hong Kong Chief Executive John Lee Ka-chiu delivered his annual policy address on Wednesday, specifying reforms to the IP regime as part of a wider plan to boost economic growth in Hong Kong. By way of context, the government’s panel on Commerce, Industry, Innovation and Technology earlier this year celebrated the importance of IP trading to Hong Kong’s economic development. It cited notable statistics such as the total value of exports and imports related to the use of IP rights growing by more than 6% and 19% respectively over two years to total approximately $5.8 billion and $16.3 billion respectively in 2022. IP intensive industries now account for about 30% of Hong Kong’s GDP and total employment respectively.
The policy address sets out the following key proposals with an aim to strengthen Hong Kong’s position as a regional IP trading centre:
- Publishing a proposal in 2025 to enhance the Copyright Ordinance regarding protection for AI technology development
- Launching a consultation in 2025 on the registered designs regime currently under review
- Proposing legislative amendments to streamline IP litigation processes for the High Court to manage and hear these cases more effectively
- Launching a new AI-assisted image search service at the Trade Marks Registry to enable more effective searches
- Hong Kong’s participation in the World Intellectual Property Organization (WIPO) Lex-Judgments Database next year, sharing important IP case precedents and judgements of local courts with the international community
- Continuing to discuss with the patent agent sector regarding the introduction of regulatory arrangements for local patent agent services which aim to nurture professional talents and enhance service quality
- A collaboration between the IPD and the Qualifications Framework Secretariat (QFS) to develop practical teaching materials for deployment by training providers, benefitting personnel across 23 different industries
Hong Kong’s proposed contribution to the WIPO Lex-Judgments Database, containing judicial decisions from jurisdictions worldwide, will help open Hong Kong’s expertise and practices up to international trading partners and make it easier for Hong Kong to play its part in shaping important precedents. The database contains searchable, categorized details for all included judgments, in addition to their full texts in their original languages, and features a cross-referencing function to national laws and international treaties. Beyond assisting local and international lawyers with research, it will be a useful tool for comparing Hong Kong’s approach to various IP questions with that of other jurisdictions. This will assist the government in making informed policy decisions and the courts in formulating new judgements.
Proposed measures to improve local patent agent services are rooted in the context of the Chief Executive’s 2022 pledge to establish a team of about 100 patent examiners by 2030 with a view to enhancing OGP examination capabilities. Given that the average annual registration volume of standard patent registrations granted has increased by more than 50% between 2011 and 2020, there is significant market potential which needs to be met with appropriate staffing and resourcing, particularly in the three key technical fields of electricity, chemistry and mechanical engineering. Further notable on the subject of education investment, this time across various IP rights, is the IPD’s plan to collaborate with the QFS to provide educational materials directly to personnel in different industries. This suggests a strategy of encouraging awareness of IP issues within different functions of businesses beyond simply legal departments, which is particularly important for IP-intensive businesses with a focus on patents and trade secrets.
With regards to the proposed legislative reform to account for AI technology, the policy address follows a major consultation document released in July this year which proposed a new exception to the Copyright Ordinance for text and data mining. The exception is expected to go beyond non-commercial research and study, to include business analytics and privately funded R&D projects. The justification behind this is the significant overall benefit brought by an AI exception to copyright, including for the development of AI technology and economic growth. The policy address now suggests that a proposal regarding enhancements to the Copyright Ordinance, which will likely include further details of such an exception, will be published in 2025. It remains to be seen how the rights of copyright owners will be balanced with a push for unfettered innovation, for example through an ‘opt out’ scheme for copyright owners to withhold their works from AI processors, and how this would function in practice.
It is clear that policy makers perceive investment in IP systems as crucial to developing a knowledge-based economy in Hong Kong. The measures outlined in the policy address reiterate the message that Hong Kong is committed to facilitating innovation with proactive legislation and refining its IP regime, to encourage IP intensive enterprises to set up international headquarters, IP management centres and R&D centres in Hong Kong.
