By Gerry Shih
BEIJING (Reuters) - Chinese telecom giant Huawei Technologies Co Ltd [HWT.UL] became the world's No. 1 applicant for international patents in 2014, a United Nations agency said Thursday, underscoring the innovative strides made by Chinese technology companies.
Huawei was followed by San Diego-based chipmaker Qualcomm (NASDAQ:QCOM) Inc while Huawei's crosstown rival ZTE Corp, which was the world's leading applicant in 2012, took third place in its number of filings, according to the World Intellectual Property Organization (WIPO).
WIPO's report, which is sometimes viewed as a rough barometer of a country's technological progress, noted that China was the only country to see double-digit growth in its filings, although U.S. companies led by far. High-tech and automotive powerhouse Japan, home to last year's leading applicant Panasonic Corp, saw its total filings slide.
In recent years China's top policymakers have offered incentives to nudge Chinese companies to shift from low-value, low-cost manufacturing to fostering innovation.
The country has also made a series of reforms to improve IP enforcement within its legal system, long considered dubious by foreign and Chinese firms alike.
The emphasis on innovation was reiterated this month at China's annual parliamentary session by Premier Li Keqiang, who made a high-profile visit to Huawei's research and development center in January.
Huawei has touted its yearly research and development budget - equal to 10 percent of its revenue - as proportionally higher than many of its peers in industry. Chief Executive Ken Hu told reporters in Barcelona this month Huawei will spend $600 million on 5G wireless research and development from 2013 to 2018.
Chinese technology industry observers say Qualcomm's antimonopoly settlement reached this year with Chinese regulators could spark a patent war as Chinese firms such as ZTE use their IP portfolios - and a stronger legal regime - to extract royalties from smartphone makers.