To increase its competitiveness and position in global innovation rankings, Canada must incentivize and support domestic industry in its efforts to commercialize new intellectual property (IP). We need a new approach to exploit publicly and privately funded IP because Canadian businesses are failing to exploit their IP and reap the economic benefits from the outputs.<\/p>\n
IP rights include \u2013 but are not limited to \u2013 trademarks, patents, industrial designs and copyright. IP products \u2500 the marketable knowledge resulting from R&D \u2500 were only 1.87 per cent<\/a> (roughly $37 billion) of Canada\u2019s gross domestic product in 2019.\u00a0In the quest for a knowledge-based economy, Canada\u2019s IP assets remain trivial.<\/p>\n Ownership of relevant IP enables a Canadian company to advance toward its strategic objective. When Canadian companies fail to properly protect and monetize their IP, they lose out on the economic benefits of maximizing its value.<\/p>\n Protecting their IP in foreign markets provides greater opportunity for scaling. However, the proportion of Canadian businesses that hold IP rights abroad is sobering \u2013 only 5 per cent<\/a> \u2013 and only 1.6 per cent<\/a> of businesses indicated in a survey that they own patents outside Canada. Patents are important for Canadian innovators to protect their ideas from being stolen, to obtain financing from investors and to secure freedom to operate. Our competitors are outpacing us in filing for patents as well \u2013 only 1.1 per cent<\/a> of businesses in Canada filed for patents between 2017 and 2019, while the OECD average in 2016 was 5.9 per cent.<\/p>\n Canada saw a decline in the number of Patent Cooperation Treaty (PCT) international patent filings between 2014 and 2017<\/a>, a grim hurdle in our ability to stay competitive in the global economy, given that the global trend is upward and China is now leading the U.S. in the sheer number of PCTs. As PCTs are a \u201cproxy for a country\u2019s ability to generate valuable IP assets<\/a>,\u201d according to an Ontario report, the fact that Canada\u2019s filings dropped 22 per cent between 2014 and 2017 \u2013 the worst among the 152 member states \u2013 while global filings grew by 14 per cent is troubling.\u00a0This downward trend shows no sign of stopping soon. There was a four per cent decline in annual growth rate of PCT applications originating from Canada between 2019 and 2020 (see figure 1).<\/p>\n