With Hong Kong increasingly seeing intellectual property (IP) as a growth engine for innovation and creativity, the power of mediation to resolve IP disputes should become more important in future, experts say.
Hong Kong has long seen potential synergies in combining its skills as a leading center for international legal and dispute resolution services with the fact it is also a premier IP trading hub, says Maria Ng, deputy director with the government’s Intellectual Property Department.
Hong Kong has long seen potential synergies in combining its skills as a leading center for international legal and dispute resolution services with the fact it is also a premier IP trading hub.
Maria Ng, Deputy director of Intellectual Property Department, HKSAR government
Mediation, in particular, will play an important future role, Ng told a one-day International Dispute Resolution Conference in Hong Kong on Wednesday.
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Known as an increasingly sought-after method of dispute resolution, mediation seeks to resolve IP disputes without the need to go to court. The mediator’s role is not to make a decision on the dispute, but to help both parties reach an amicable solution.
The growing attention placed on mediation fits in well with an emerging trend where Asian-based innovators are becoming the driving force for international patent applications. This is a trend that “underscores the historic geographical shift of innovative activity from West to East”, says World Intellectual Property Organization (WIPO) director general Francis Gurry.
Last year, Chinese telecom giant Huawei led the way with Asia accounting for more than half of the international patent applications at the WIPO, according to its annual report released in March.
Huawei has been in spotlight more than ever since the United States encouraged its allies to bar Chinese vendors from participating in building 5G networks. But the company has made a record-breaking 5,405 patent applications to the United Nations body — up from 4,024 in 2017.
Matching these headline-making IP applications is the record-setting IP disputes. In Chinese mainland alone, the number of first instance civil IP cases filed in courts in 2017 increased by 47 percent from 2016, said Ng, citing figures from a white paper from the Supreme People’s Court of China.
“Basically, IP disputes can be complex, sophisticated and expert-heavy,” said Zhao Yun, head of Department of Law at the University of Hong Kong.
“Such disputes tend to be painfully slow and any delays can be harmful to innovation and market leadership.” As rapid technological developments today shorten the life cycle of innovation more than ever before, use of mediation as an effective means to resolve IP disputes should be highly valued, Zhao said.
“Unlike the traditional dispute resolution methods, such as judicial or arbitral proceedings that offer a winner-takes-all approach, mediation leads to a win-win situation where mutually beneficial outcomes could be produced,” Zhao explained.
Advantages are obvious. Mediation enables parties to steer clear of costs, delays, marginal returns, and the uncertainties of litigation, said Colin Ong, a partner at Dr Colin Ong Legal Services.
It is also an attractive option for parties that value preserving or enhancing their relationships, or those wanting to maintain control over the dispute settlement process, value confidentiality, or seek a speedy settlement without damage to their reputations, Ong added.
For multi-jurisdictions and cross-border IP disputes, mediation provides an opportunity for the dispute to be resolved globally. It saves parties the trouble of taking disputes to courts in all relevant jurisdictions, Zhao noted.
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Such remarks come at a time when tech behemoth Apple and chip maker Qualcomm surprisingly agreed to settle all on-going lawsuits worldwide on Tuesday. This ended a multibillion-dollar legal battle brewing since 2017 over royalty payments, patent infringements and IP theft.
Now, there is no shortage of countries jumping on the mediation bandwagon. From the beginning of 2019, mediation becomes a mandatory procedure for monetary-related IP disputes in Turkey.
This was followed by Greece —which made trademark civil disputes subject to mandatory mediation last year. All disputes concerning trademarks, patents and industrial designs initiated before civil courts are also subject to mandatory mediation.
Zhao believes mediation calls for “a change of mindset”. “The goal of resolving a conflict should not be victory or defeat but rather reach common ground by letting go of the need to be right,” he noted.
Facilitative mediation is the most common type of mediation used in Hong Kong, while evaluative mediation is mostly used on the mainland; this highlights that there is potentially a lot of room for the two jurisdictions to work together, Zhao added.
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