A Comparative Study of U.S. and Japanese Patent Systems
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*MasaakiKotabeis AssistantProfessorof Marketingand InternationalBusiness attheUniversityof Texasat Austin.His researchinterestsincludeglobalsourcing, issues.Hisresearchhasappeared competitivestrategy,andcross-cultural comparative in suchjournalsas Journalof InternationalBusinessStudies,ColumbiaJournalof WorldBusiness,InternationalMarketingReview,andJournalof Marketing,among others. The author gratefully acknowledges the assistance of Michael Gottler of Koblenz School of Corporate Management, Germany, Thomas Turcan of London Business School, and Vance Parker of the University of Texas at Austin Law School. The authoralso thanks three JIBS reviewers for their construc-
tive suggestionson an earlierdraftof the article.
Received:March1991;Revised:July 1991;Accepted:August1991. 147
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JOURNALOF INTERNATIONALBUSINESS STUDIES, FIRST QUARTER 1992
receiving the largest numbers of U.S. patents in 1987 were all Japanese (Canon K.K., Hitachi, Ltd., and Toshiba Corp.). On the other hand, only 17% of the Japanese patents are held by foreigners, and only 7% of all Japanesepatents grantedin 1986 were awardedto U.S. companies. Obvious differencesexist between the United Statesand Japan.It is not clear,however, whether these differences are as a result of the discriminatorypractices of the Japanese patent office. Japan's enormous marketsize as one of the most industrializedregions and the tremendous stride of Japanese firms in markets around the world have compelled U.S. and European firms to attempt serious inroads into Japan in recent years. Adequate protection of foreign firms' intellectual property in Japan, particularlypatents, has become an increasingly important issue for business practitionersand researchersalike. It is crucial to better understand the Japanese patent practices. This study empirically examines whether the Japanese patent practices are a NTB. NTBs are generally defined as a non-tax measure imposed by government to favor domestic over foreign firms [Coughlin and Wood 1989]. In the next section, the U.S. and Japanese patent systems will be compared and contrasted. Ample references will also be made to British and German patent systems so as to better illuminate the similarities and differences between the U.S. and Japanese systems. This study focuses on the substantive and procedural aspects of patent protection in these two countties. Such a comparativereview of the patentsystems wlll help identify the causes of the controversy over patent applications and grants between the United States and Japan. THE U.S. AND THE JAPANESEPATENT SYSTEMS Intellectualpropertyrightsare of greatconcernto high-technologyindustries. However, the laws protectingsuch rights are considerably differentthroughout the world. The U.S. InternationalTrade Commission estimated in 1984 that "infringement of intellectual property" worldwide cost $8 billion in lost U.S. sales [Int
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