IP/C/W/638  
 
16 February 2018  
(18-1015) Page: 1/2 
Council for Trade -Related Aspects of  
Intellectual Property Rights  Original: English  
 
 
INTELLECTUAL PROPERT Y AND INNOVATION: IN CLUSIVE INNOVATION  
AND MSME GROWTH  
COMMUNICATION FROM A USTRALIA; CANADA; TH E EUROPEAN UNION; JA PAN; SINGAPORE; 
SWITZERLAND;  SEPARATE CUSTOMS TER RITORY OF TAIWAN, PE NGHU, KINMEN AND MAT SU; 
AND THE UNITED STATE S 
The following communication, dated 9 February  2018, is circulated at the request of 
the Delegations of Australia;  Canada; the European Union; Japan; Singapore; Switzerland;  
Separate Customs Territory of Taiwan, Penghu, Kinmen a nd Matsu ; and the  United Stat es. 
 
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1.  The WTO TRIPS Council considered the topic of Inclusive Innovation and MSMEs: Collaboration, 
Growth and Trade throughout 2017. The co -sponsors have prepared this paper to summarize 
the discussions by highlighting some of their exampl es raised and reiterating the value of 
intellectual property (IP), inclusive innovation and MSMEs.  
2.  Recent data has shown that businesses using IP rights perform better on average and this is 
often true in the case of MSMEs. Likewise, businesses owning IP r ights often have a higher 
revenue per employee than businesses that do not. In many cases, they also expand their 
workforce faster and pay higher salaries. IP is therefore important for smart and sustainable 
growth. MSME -driven inclusive innovation has a s ignificant social as well as economic impact in 
both developed and developing economies, given that approximately 95% of businesses around 
the world are SMEs, which account for 60 -70% of private sector employment. MSMEs often focus 
on local markets. It is a key challenge to integrate MSMEs into global trade and enhance economic 
outcomes. There is still ample room for MSMEs to better utilize IP both domestically and 
internationally to support this goal. It is thus important to consider initiatives for streng thening IP 
strategies for MSMEs.  
3.  MSME collaboration is multidimensional. Collaboration can occur in various ways such as 
between MSMEs themselves, in public -private partnerships, inter -firm partnerships, incubators and 
other ventures at the regional, natio nal or international level. A number of WTO Members provide 
program mes or platforms to stimulate partnerships and other cooperative/collaborative 
undertakings among a variety of entities, including universities and start -ups. IP rights support 
inclusive co llaboration and they play a role in collaboration related programs or platforms such as 
the Global Innovation Strategy (Australia), the European Cluster Collaboration Platform (EU), the 
Public -Private Partnership Innovation Program (Japan), Emerging Indust ries Accelerator 
Program me (Chinese Taipei), and the Global Innovation Forum and US Cluster Mapping Project 
(US). Adequate framework conditions are important. This includes providing legal certainty, 
reliable IPR protection and efficient enforcement mechan isms. Under those conditions, MSMEs will 
more readily engage in innovation collaborations and thereby contribute to the growth and 
competitiv eness of the national economy. ( March, 2017 ) 
4.  MSMEs can achieve sustainable growth using IP. IP rights provide MSMEs the confidence and 
the means to invest in research and development -based products and services. IP rights boost 
MSMEs' growth opportunities and help allocate their resources efficiently  and increase their 
productivity. The EU -coordination platform (EU), IP Education and Awareness Program (Canada) 
and IPR educational "Stopfakes " road shows and trade shows (US) are introduced as measures for IP/C/W/638  
 
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  enhancing IP awareness, and the Entrepreneurs' P rogramme (Australia), Comprehensive IP 
Support Service Counters (Japan), the Inclusive Innovation Initiative (US), IP Value lab 
(Singapore), and IP Consulting Center for SMEs (Chinese Taipei) have been mentioned as means 
for supporting innovative MSMEs to develop or consider effective IP strategies. Establishing 
favorable IP conditions also has positive effects on local growth potential in middle and low income 
economies. WTO Members provided examples of the role of IP in the development and diffusion of 
new technologies that help improve economic conditions in rural areas and minority communities. 
By supporting MSMEs and facilitating their growth, such public IP measures and means are often 
carried out and found to have an important and positive effect. (June, 2017 ) 
5.  IP rights can help create and maintain value added and export opportunities to MSMEs. 
Formulating appropriate IP strategies overseas is therefore important. Such supportive activities 
are undertaken by many WTO Members, and can be of great help i n facilitating the integration of 
MSMEs into global value chains. IP strategies can focus on facilitating the integration of MSMEs 
into local and global value chains, thereby increasing trade opportunities. Tradable IP rights and 
assets can also be a major  facilitator of MSMEs' national and international trade activities. For 
example, some governments offer services which provide MSMES with key resources to make sure 
that innovators have what they need to turn a great idea into a successful business and tak e 
advantage of global opportunities. For example, government agencies jump -start MSMEs efforts by 
helping companies to identify, screen, and meet prospective partners, agents, distributors, and 
customers in foreign markets, thereby increasing MSME exports and international sales (US). 
Likewise, highly productive and innovative growth sectors, such as the food processing industry, 
rely heavily on such assets (Japan). Some products and related marketing tools allow for 
a particularly varied and extensive IP s trategy, which can further expand MSMEs trade 
opportunities, as was exemplified with an example from the cheese sector (Switzerland).  
(October,  2017) 
6.  At the Friends of IP and Innovation sponsored side -event on the margins of the October 
meeting, we heard d irectly from four MSME stakeholders from South Africa, Israel, Indonesia and 
Colombia on the benefits of IP to promote MSME development. A representative of a South African 
university tech transfer office, legal counsel for an Israel -based telecomm company , an Indonesian 
guitar manufacturer and an IP Office official from Colombia's Technological Information and 
Support to Industrial Property Management Center (CIGEPI) stressed the importance of 
policymakers investing resources in the IP system. A reoccurrin g theme of the event was the call 
for more IP awareness and education for MSMEs so they can: (i) access trademark and patent 
protection; (ii) participate in government funded research projects; (iii). obtain enforcement of IP 
rights; and (iv) facilitate th e collaboration with other companies and entities to help entry into the 
global market. The stakeholder presentations highlighted the importance of IP to MSME growth 
and the pivotal role that government can play as a catalyst for the private sector to grow  their 
businesses and take advantage of global opportunities.  
7.  Overall, discussions held during the three meetings of the TRIPS Council in 2017 provided 
a robust and thorough overview of WTO Members' national and international IP strategies, both 
from devel oping and developed countries. WTO Members provided examples of program mes and 
policies designed to promote inclusive innovation and trade opportunities for MSMEs, as well as 
examples of MSMEs applying individual IP strategies which enable them to collabor ate, grow, and 
engage in national and international trade.  
 
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