How the world will be affected if Russia removes restrictions on the use of IP rights?

The ministry of Economic Development of Russia discusses the removal of restrictions on use of Intellectual property.

I woke up to this news and this is a big step that the Russian government is discussing. To all those who think that there would be a nuclear war. Fellas, that’s the last option and nobody wants that. The war has already begun and it is a trade war.

As the west has sanctioned Russia with imports, exports, banks, currency, etc. Russia doesn’t have many options left to control the damage that is happening to its economy. One of the counter-sanctions that are thinking of is removing the IP rights of foreigners whose products cannot be imported due to sanctions.

After two world wars and a Cold War, the world leaders understood that wars are going to happen unless every country and individual participating in war understands the direct impact of war on them. Thus, globalization and world trade enhancement was proposed. Countries engaged with each other directly and thus if one country wages war against any other country, multiple partners that are trading with these countries would be affected.Thankfully, this system saved the world from a global war for nearly seventy years. Even today, the non-participation of European Union, UK and USA in the Ukraine-Russia conflict is largely due to the huge economic cost these countries will bear in event of direct participation.

As the world progressed, the countries participating in trade started using Intellectual property rights to safeguard their creations. Manufacturers, companies, and individuals, applied for patents in the countries where they wanted to protect their commercial interests and then reaped profits in foreign lands. It is a decent system as it creates a certainty of avoiding misuse of technology.

What would happen if the Russian Government suddenly removes the IP rights of foreigners? How would it shape the future?

Understanding IP rights

In laymen’s terms, IP rights are rights granted by any nation to a certain individual, group of individuals, or an establishment for their mental creation. Patents, trademarks, copyrights, etc. are some of the IP rights.

These rights help the creators to prevent anyone from misusing their creation and also provide certainty that their efforts will be rewarded. Anyone using their creation would obtain a license and pay them a fee. Thus, the creator would earn something for the product. At the same time, since the rights are granted and enforced by the government (by punishment, fines, laws, etc.), people are more likely to share their inventions with the public which contributes to the overall growth of society.

Which countries support IP rights?

Almost everyone. The majority of countries participating in global trade have some sort of IP protection and laws regarding IP protection.

Why is Russia suddenly thinking about removing them?

The western allies have forced Russia to settle for huge economic loss due to its conflict with Ukraine. Now when the west has sanctioned Russia with a ban on imports, exports, technology transfer, currency, etc. Russia doesn’t have many choices left.

Having IP rights will force Russia to not manufacture, use, import, export the products that are protected by foreign entities. In event of not being able to procure the item from the foreign companies and not being able to manufacture it on your own due to an existing IP right, the country would face issues with availability. This would eventually heat up inflation and public unrest.

While this is not so impacting for the majority of items but can be a real issue for pharmaceuticals, drugs, critical technologies of the automotive, energy, healthcare, and communication sector. The absenteeism of any critical technology would topple the growth and Russia would be left behind reeling with the scars of the war.

The country can use the technologies without removing rights. Who is going to check this in the current situation?

Well, Yes, the Russian companies can actually do it right now but would it send a message to the other economies. “No”

Russia also needs to send a message to the world that while your sanctions are damaging and hurting our economy, your corporations would also lose a lot of their values. When their premium products and years of research would be used by the common public without any credit and appreciation, they are less likely to enjoy it.

Now when the government will remove the IP rights, the actions of Russian entities who would copy, produce and sell these protected products wouldn’t fall in the domain of infringement. There won’t be multiple lawsuits against those firms but only a few against the Russian government.

At the same time, it will enhance the confidence of Russian corporations to manufacture those products which are no longer protected. It provides a slim chance to prevent the shortage and block the harm that the west is trying to do to Russia with the trade sanctions.

We have your technology, we will make it in our land. F*** Y**

How the world would react to this?

This is an example. Next time, if any country goes to war against any other country, they will first discredit the IP rights.

The biggest risk is with countries like China, India, Indonesia, Vietnam, etc. which have great capabilities in terms of manufacturing and creating technologies. Non-availability of IP rights would create a risk of low quality and cheap products with identical features.

This would force corporations to slash their profit margins, depreciate the trust of technology sharing and the majority of firms would think twice before disclosing their critical IP assets.

There is going to be mistrust in trade. Trade secrets would be a more preferred choice.

Patent offices would lose money.

Companies would oppose their native governments of decisions of banning their products due to sanctions.

A large set of IP protection would be made via local firms to safeguard the interests in event of any uncertain times

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Lalit Dixit

Lalit Dixit

In a complicated world full of random data, I exist to uncomplicate

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