Outline of Intellectual Property Activities

(1)Status of Patent Applications, Securing Intellectual Property Rights, and Patent Portfolio

The number of published Japanese patent applications filed by Konica Minolta in fiscal 2013 was 2,924. A breakdown indicates that the Business Technologies Business accounted for approximately half of the applications. Numerous applications were filed in the Industrial Business field, particularly with regard to OLED lighting, accounting for 27% of the total.

Overseas sales account for more than 70% of Konica Minolta’s net sales, and we have numerous overseas sites and production sites. Konica Minolta actively submits applications and secures intellectual property rights worldwide to cover important markets and production countries to support its business activities with intellectual property. Specifically, we continue to conduct aggressive patent application activities and securing our intellectual property rights in the United States, a key market, while in China, an important market and production country, we are reinforcing patent applications and measures to secure intellectual property rights.

Number of published Japanese patent applications

As a result, the number of patent registrations and patents held in each country is rising steadily. Konica Minolta registered 2,108 patents in Japan in fiscal 2013. This figure is approximately 1.5 times greater than the number of registrations Business Technologies Business 55% Common fundamental technology and advanced Healthcare technology 20% business 5% Industrial business 20% Percentage of R&D expenditures 71.1 billion yen Business Technologies Business 49% Common fundamental technology and advanced Healthcare technology 19% business 5% Industrial business 27% Number of published Japanese patent applications 2,924 ‒ 3 ‒ in fiscal 2009. Based on information from the “Patent Office Annual Report 2013 Edition” issued by the Japan Patent Office, Konica Minolta’s rank in fiscal 2013 was 16th, the same as in fiscal 2012. As of the end of fiscal 2013, Konica Minolta held 11,831 patents, an increase of 1.7 times compared to fiscal 2009.

Change in the number of patent rights held in Japan, the U.S. and China.

In addition, Konica Minolta had 680 patent registrations in the United States in fiscal 2013, approximately 1.5 times the number in fiscal 2009, ranking 19th*3 among Japanese companies. The number of patents held at the end of fiscal 2013 was 1.2 times higher than in fiscal 2009. Furthermore, Konica Minolta registered 145 patents registrations in China in fiscal 2013, which is 1.2 times higher than in fiscal 2009. The number of patents held in China as of the end of fiscal 2013 was 687, up approximately 2.5 times from fiscal 2009, a substantial increase that is the result of our efforts to secure intellectual property rights.

Konica Minolta also makes use of the Patent Cooperation Treaty (PCT) to select suitable countries for filing patent applications in fields undergoing rapid changes in the business environment, which enables us to carefully observe technological trends and patentability during the period until the transition to application in each country. As shown in the chart, the percentage of the published international PCT applications in Konica Minolta's published Japanese patent applications has increased to approximately 17% in fiscal 2013 from 15% in fiscal 2009.

Percentage of the number of published international PCT applications

(2) Compensation and Reward for Industrial Property Rights

Konica Minolta has established and operates internal regulations for compensation and reward for industrial property rights, with the aim of inspiring our employees' inventive ideas and promoting aggressive applications for patent, etc. Application and registration compensation is paid to employees who create an invention or design at the time of application and registration. In addition, compensation for performance is paid for employee contributions to Konica Minolta products, and assignment and license compensation is paid based on actual income obtained as a result of assignment or a license granted to a third party. Due consideration is always paid with regard to the amounts of such compensation to ensure that they serve as incentives for employees. For example, the prior limit on the total amount of compensation paid based on license income was eliminated and a system that pays compensation according to license income was instituted.
Also, a system that offers employees a wider range of options concerning the method of payment of compensation was adopted. In addition to a typical method of payment used by many companies that provides payments when an application or registration is filed or when a contribution to the company’s products is made, Konica Minolta also offers a lump sum payment at the time of application. Employees are free to select either method of payment of compensation.
Konica Minolta has development sites in the United States and China and has created and operates compensation systems tailored to the local conditions in each country to better serve employees who work at those sites.
In addition to the compensation discussed above, Konica Minolta also has a program that pays rewards to employees based on the degree of contribution to intellectual property rights activities, and this too serves as an incentive to employees.

Summary of the compensation system

*3 The rank is estimated from the data in Intellectual Property Owners Association (Top 300 Patent Owners).