Non-Practicing Entity’s impact on China's patent market and innovation activities

This dissertation provides a Possible analysis of the impact of the shift of the focus of NPE activities to China on the Chinese patent market as well as innovation activities from the enterprises and social levels. In this dissertation, we classify NPEs into three types: research-oriented, litigation-oriented and defensive-oriented, and analyse them through the trends and causes of NPE activities and the profit logic of NPE business models, combined with real-life cases. We learn that all types of NPEs assume the role of patent operation and generally have the beneficial effect of promoting technology flow and improving innovation performance. Research-oriented NPEs are mainly engaged in technology research and development and aim at innovation, which is generally beneficial to innovation; the speculative attributes of litigation-oriented NPEs lead to high overall costs to society when they realize the benefits of patent operations, which are more detrimental than beneficial to innovation; defensive-oriented NPEs, as a response to litigation-based NPEs, can provide protection to relevant enterprises to focus more on innovation activities. In addition, this dissertation proposes ways to deal with the adverse effects of NPEs from the perspectives of national legislation and administration and enterprise prevention, taking into account the experiences of Europe, the United States, Japan and South Korea; and proposes inspirations and directions for the utilization of NPEs in China in view of their advantages.