There was a time when all U.S. business competitors and markets were domestic, and we only needed to protect our technology in this country. With the U.S. ratification of the General Agreement on Tariffs and Trade (GATT), the emergence of China and the Pacific Rim, and the removal of many global trade barriers, unprecedented business opportunities are available in the evolving global marketplace. Because many companies are expanding globally, those that fail toseek international opportunities operate at a competitive disadvantage. Also, as manufacturing jobs shift to third-world countries, a new class of consumer is being created.
Patents prevent anyone from making, using, selling, offering to sell or importing an invention as claimed in the country where the patent is granted. For example, once a United States patent is granted, anyone that makes the patented product outside the United States and imports it into this country infringes that patent. However, if the patented product never enters the United States, there is no infringement.
Moreover, foreign opportunities abound. China, for example, with a population of 1.2 billion people, represents the largest potential market in the world. If only one percent of the people in China bought a vehicle each year, 12 million units would be sold. Moreover, The New York Times recently estimated that, inthe year 2000, 6.4 million vehicles will be sold in the emerging economies of China, India, Thailand, Taiwan, Indonesia, Malaysia and the Philippines -- up from 1.9 million vehicles in 1990.
Since Western technology has traditionally not been protected in these emerging markets, much of it is already in the public domain there. As companies from the West expand production into these developing economies, there is increased risk that additional Western "know-how" will be lost. While technology already lost to the public domain cannot be recaptured, U.S. companies should focus immediate attention on reversing this dangerous trend. Key to their efforts will be the use of regional and foreign-national patents.