On 19 October 2023 the General Office of the State Council issued the Special Action Plan for Patent Commercialisation (2023-2025), targeting a clear rise in patent commercialisation by 2025 through inventories of university and institute patents, patent-intensive industries, services and financial support.
Dormant patents are not a new problem. Large numbers of university and institute patents remain at the certificate stage and never reach industry. The plan attempts to turn patents from “results” into “assets” through inventory, valuation, matching and benefit-sharing.
Inventory of existing patents
The plan requires universities and research institutes to inventory existing patents and build a commercially viable pool. The key is not counting but judging which patents have industrial value, which can be licensed and which should be abandoned.
Inventory requires technology, legal and industry input. Reading claims alone overvalues; reading papers alone ignores claim scope. Patents that actually convert usually have clear technical boundaries, implementability and defined use cases.
Employee inventions and benefit-sharing
One core obstacle is benefit-sharing between inventors and institutions. The plan calls for improved distribution of commercialisation proceeds, higher shares for researchers and exploration of rights-granting reform.
Universities and institutes need to connect rewards, remuneration, equity and academic evaluation. Corporate partners need technology contracts specifying inventorship, application ownership, improvement sharing and follow-on licensing. A letter of intent cannot support long-term commercialisation.
Open licensing and negotiation
The plan promotes open licensing to reduce transaction costs. Open licensing suits standardised patents with dispersed users; core and customised technologies still require case-by-case negotiation.
Typical disagreements include scope, territory, term, exclusivity, ownership of improvements, infringement liability and termination. Companies should not negotiate only royalties; structural terms matter, and their defects often surface years later.
Financial support and valuation
The plan calls for improved pledge financing, insurance and investment. Pledges require valuation, registration and enforcement paths. Valuers examine technical advancement, legal stability and market prospects; lenders examine disposal difficulty and liquidity.
Companies with patent portfolios should manage them in layers — core, peripheral and defensive — rather than pledging everything as a bundle. Layering improves financing efficiency and preserves negotiating leverage.
What companies can do
First, review the portfolio to identify licensable, pledgeable and abandonable patents. Second, settle ownership and benefit-sharing before technical details in university collaborations. Third, adopt technology contract templates covering scope, improvements, infringement liability and termination. Fourth, use open licensing platforms and patent pools to lower acquisition costs.
For patent strategy and licensing, see our intellectual property service; for technology and licence agreements, see commercial contracts; for IP due diligence in M&A, see intellectual property.
This article is based on the Special Action Plan for Patent Commercialisation (2023-2025) issued by the General Office of the State Council on 19 October 2023. It is for reference only and does not constitute legal advice.