Shaping China’s Innovation Future
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Shaping China’s Innovation Future

University Technology Transfer in Transition

  • Elgar Intellectual Property and Global Development series

John L. Orcutt and Hong Shen

Shaping China’s Innovation Future employs a thorough analysis of a combination of factors including: the role of law and China’s legal system; economic theory and the development of China’s economy; China’s educational, intellectual property, and financial systems; China’s innovation capacity; and Chinese culture. Though the recommendations on how to improve China’s technology commercialization system are unique to China, the scope of the research makes the conclusions found here applicable to other countries facing similar challenges.
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Chapter 6: China’s Bayh–Dole System

John L. Orcutt and Hong Shen


For governments, granting [public research organizations] rights to IP generated with public funds can lead to better use of research results that might otherwise remain unexploited as well as to the creation of academic spin-offs or start-ups that create employment. – OECD1 There should be little debate that China possesses a reasonable IP protection system that provides sufficient patent protection, including patent enforcement, to support a Bayh–Dole approach to technology transfer. The next key question, therefore, revolves around the ownership of IP generated with government funds. Under Chinese law, who owns the IP that results from government-funded research? This chapter explores China’s legal framework for commercializing university-developed technology, including the economic incentives that result from that framework. This chapter also analyzes the sharp increase in technology commercialization that has come from those efforts. 1. CHINA’S BAYH–DOLE 1.1 Earliest Regulations for IP Ownership of Government-Funded R&D Until 1994, China did not have a well-formed policy regarding IP generated from government-funded research.2 During the earliest years of the reform era, there was little reason to worry about such IP ownership, since the government owned everything and China’s innovation system was still operating under the ‘functional specialization’ model (see Chapter 2). GRIs generated R&D, which the government owned and could transfer to the business sector as it saw fit. With China’s attempt to create a technology market in 1985 (see Chapter 2), however, the need to incentivize and legitimize China’s various technology actors (including GRIs and universities) to transfer government-funded...

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