While the number of disputes regarding intellectual property has been increasing in line with the development of advanced technology, the new body is expected to create a scheme to enable early settlement among parties concerned, which is considered a key to facilitating overall business activities.
The government of Japan, which promotes itself as an intellectual property nation, plans to provide support to encourage the use of the scheme.
Unlike ordinary trials, arbitration is a system by which parties concerned can select the arbitrator who assumes the role of a judge to settle disputes.
Based on the New York Convention (see below), to which more than 150 countries are signatories, the arbitration system helps to settle disputes involving multiple countries all together under the judgment of an arbitration body.
It is expected that more than 10 experts will be registered as arbitrators in the new body, including Randall Rader, former chief judge of the U.S. Court of Appeals for the Federal Circuit, who is known as a leader in the field of intellectual property law; Ryuichi Shitara, former chief judge of the Intellectual Property High Court; and other experts from Europe, China and South Korea.
The new body will open what is to be called the International Arbitration Center in Tokyo (IACT) as early as September.
As use of the internet of things (IoT), which connects various devices online, has become widespread, there has been a global increase in the number of patents regarding advanced technologies such as for sending and receiving data and compressing images. As a result, the number of disputes regarding patent infringement is also increasing, concerning companies from the United States, China and Europe.
The launch of the new arbitration body is expected to ensure neutrality in cases involving those countries, as arbitration procedures will be held in a third country of Japan.
According to the Japan Patent Office, arbitral institutions in the United States and Europe receive about 800 to 1,000 cases of international disputes a year.
In Asia, arbitration bodies in Singapore and Hong Kong are trying to enhance their presence, but they have their own areas of specialty, such as maritime transportation or trade.
There has been no international arbitration body that specializes in intellectual property in Asia.
The new body is designed to focus exclusively on intellectual property cases and aims at settling each case within a year.
For companies, filing an ordinary lawsuit over intellectual property means taking a much longer time to resolve the case, which imposes a heavy burden on the firms, including legal fees.
The legal battle between Apple Inc. of the United States and Samsung Electronics Co. of South Korea over smartphone technology was held in courts of various jurisdictions such as Japan, the United States and Europe, and it took seven years until they reached a settlement.
Many observers say that an ordinary lawsuit cannot keep up with the speed of technological advancement as well as expansion of business activities.
The new arbitration scheme, however, has challenges. If the scheme does not produce satisfactory results, it is said that not many firms would use the scheme.
Unlike ordinary lawsuits, arbitration procedures are closed to the public. Thus, it is difficult for companies to use past cases as references for working out their corporate strategies because they cannot see the debate process, some observers said.