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Boosting Innovations: The Cluster Approach. Paris: OECD, 1999.

Fomichev Yu., Naumov . Involving Intellectual Property Objects into Economic Turnover: Challenges and Solutions // In tellectual Property. Industrial Property. 2004. No. 3. P. 9.

Section 3.

The real sector An example of a cluster is found in a research city in some cases. Yet, this form of in novation promotion is not efficient enough. Four years of implementation of a development program on the first research city (city of Obninsk) showed that stable, grant free and self financed development of the city failed, no integration between the science and indus trial sectors was achieved, the number of young researchers failed to grow at the back ground of scientific labor outflow of Obninsk. Such situation was caused by organizational and administrative failures committed in particular by the municipal executive authorities acting as the general contractor of the program, who consider the current matters of mu nicipal economy as top priority, not innovative development. In addition, no mechanisms of monitoring and adjustment of the program were developed40.

Due to poor efficiency of the existing infrastructure (research cities, technological parks, incubators), the government has been seeking new and highly efficient types of in novation infrastructure. In particular, late in 2004, the issue of special economic zones (SEZ) in Russia was brought up again. A Federal Law On Special Economic Zones in the Russian Federation is to be submitted to the State Duma for consideration not later than on March 1. One of the two types of zones technological and commissioning ones should be established on the territory within not more than 2 square kilometers which a view to establishing and industrial commissioning research and technological products.

The first practical step in establishing SEZ was formulated as a national task of creating several technological parks in the field of information technologies (IT). The case in point is to establish 4 technological parks till 2010 in Dubna, Chernogolovka, Saint Petersburg and Nizhy Novgorod. Tomsk Region is being considered as a construction site of such techno logical park.

Construction of an IT technological park was commenced in Dubna prior to the date when it became a strategic task of innovation development. A group of companies Infor mation Business Systems (IBS) was the originator of such technological park. Ten thou sand Russian software specialists are expected to participate. Boeing Company ex pressed its intension to invest in development of the technological park as well as the infrastructure being under development at Saint Petersburg.

A Nizhny Novgorod technological park will be established on the basis of the Sarov Federal Nuclear Center. AFK System will be the investor of record. The regional govern ment has already allocated a site for the project, and AFK has purchased a controlling in terest from Sarov System Technologies Transfer Center management company, as well as invested nearly $1 million in first stage construction of the technological park. Sarov Sys tem is currently negotiating on participation of international corporations in the technologi cal park. Intel may be one of the first ones.

It should seem that IT sector has been selected due to a short term return. The In dian experience is also worth considering. India has achieved a share of up to 12.5% in the world export market of software products. The Russian share still accounts for 0.7%. Such selection, however, is ambiguous because IT can not be included into the list of industries in which Russia has competitive advantage. Since high qualification of Russian software specialists is universally accepted and their wages are higher than that of their Indian or Chinese counterparts, it is quite natural that Russia is occupying a sophisticated software niche in the market. However, the market share of software is objectively small, which pro vides no reserves for future growth. This is why IT technological parks is a continuation of offshore outsourcing as well as further development of the scheme under which the coun try is selling research and development rather than ready to use technologies.

According to the materials of the Committee of Social Council for Research City Issues, city of Obninsk.

RUSSIAN ECONOMY in trends and outlooks Though a new law on SEZ is expected to reflect specific features of the IT industry (inclusing taxes and customs duties), elimination of administrative barriers would be one of the basic incentives for innovation development within the framework of technological parks. According to the Ministry of Economic Development and Trade, creation of a single zone infrastructure is estimated to cost $100 to 150 million. These figures seem to be overestimated as compared to the foreign practice in establishing technological parks: the average costs incurred on technological park development in the United States and Great Britain is $10 to 12 million, and nearly $100 to 200 thousand in Poland. In addition, the ex isting estimates on the Nizhy Novgorod technological park show that it would cost $28 to 29 million. In doing so, it is important that SEZ should comprise various types of infrastruc ture, including developing lines, social sector and utilities sector, road network. Efficiency of new technological parks will depend on the principles representing the mechanism of companies selection, as well as the criteria applied.

There are several amendments to the applicable law that could interfere with the de velopment of the clusters, research cities and other elements of the infrastructure. The Federal Law On Amendments to Laws of the Russian Federation and Invalidity of Various Laws of the Russian Federation in Relation to Adoption of Federal Laws On Amendments to the Federal Law On General Principles of Organization of Public Legislative (Represen tative) and Executive Agencies of Constituent Entities of the Russian Federation and On General Principles of Organization of Local Self Government in the Russian Federation41 is almost excluding from the Federal Law On Science all issues related to the authorities of a constituent entity of the Russian Federation concerning general issues of science which are constitutionally delegated to joint administration of the RF and constituent entities of the RF. Science is not included in the list of issues of joint administration on which RF con stituent entities may utilize their budget funds. Innovation structure is established on the basis of cofinancing by the federal and local budgets. Moreover, according to a revised version of the Law on Science, only procurement and financial provision of scientific and technological activity of government agencies of RF constituent entities shall fall within the authorities of government bodies of RF constituent entities (paragraph 3, clause 12).

Since no scientific organizations fall within the authorities of RF constituent entities, it means that RF constituent entities are not supposed to finance scientific and innovation activity. Some clauses of the provision were amended late in 2004, when a Federal Law On Amendments to the Law of the Russian Federation In Relation to Accretion of Powers of Government Authorities of RF Constituent Entities On the Issues of Joint Administration of the RF and RF Constituent Entities, As Well As In Relation to Enlargement of the List of Local Issues of Municipalities 42 was adopted. Pursuant to the Law, RF constituent entities may initiate and implement regional scientific and technological programs and projects (paragraph 53, clause 11).

In 2004, the RAS conducted preliminary actions and made organizational changes for establishing its own innovation infrastructure. At present, the RAS framework includes several structures intended to provide centralized record keeping of the ongoing innova tion process at institutes within the RAS, namely a Working Committee for Intellectual Property under the RAS Presidium, Steering Committee for Innovation Activity under the RAS, Innovation Agency under the RAS, ITC Association under the RAS. A Department for Intellectual Property is under development with the RAS framework. It will specialize in building up a data base of most promising and commercially potential research works, Federal Law of August 22, 2004, No. 122 FL.

Federal Law December 29, 2004, No. 199 FL.

Section 3.

The real sector monitoring intellectual property turnover at RAS institutes, developing major innovation projects under the supervision of the RAS, patenting related activity. In addition, a concept creating an innovation belt around the RAS is under dynamic development, which would comprise technologies promotion centers (TPC), technological parks, research and development based cities and other elements of infrastructure, and for commercialization of research works under RAS copyright 43.

Technologies promotion centers were established both within the framework of the RAS and other sectors of science. To date, the majority of TPC have been operating for a period of one year or so. Most common challenges that are facing almost all TPC in the in ception period are as follows. First, on the one hand, scientists are poorly prepared for commercialization of the findings of their research, quite often they have no desire to con duct this kind of work. On the other hand, some believe that they have sufficient resources to do everything autonomously, while TPC may help only through supplementary financ ing. Second, the majority of research and development findings are poorly designed for commercial utilization: a model is normally made rather than the end product. Third, there are problems related to legal provision, especially in regulating relationship between em ployees and employers on a contractual basis. As a consequence, organizations have no information on the research work performed by their employees. There is another material loophole in the law regarding regulation of rights to intellectual property. Finally, forth, there is a general lack of information on findings of research works at different organiza tions. Some TPC started to establish information networks due to this problem.

At present, TPC are operating at the stage of revision of research works of those in stitutes they were developed at, or organizations of the regions they are located in. Corpo rate markets survey is less intensive due to lack of qualified managers of these centers.

The share of commercial services accounts for not more than 5% of total TPC works per formed, yet there is no such profit item for TPC as revenues from licensing of revenues.

Basic revenues sources in TPCs budgets are public budget allocations, financial support from the parent institute or region, and grants. Efficiency of the established TPC remains to be measured, however the Ministry of Education and Science made a decision to fi nance establishing of another 10 centers. General practice of supporting TPC is that the government provides them with financing for a period of 7 to 8 years, whereupon such structures should become self financed.

Managers of such centers believe that their further development will be related with more involvement in a START program implemented by the Promotion Fund for Small En terprises in Science. In 2004, 474 projects on small innovation enterprises were financed to a total amount of RUR375 million as part of the START program 44. There were approxi mately 6 bidders per grant. The program should end up as follows: establishing and devel oping a new small enterprise employing 5 to 20 persons by the end of the third year of op eration, volume of sales of innovation products is supposed to reach at least RURthousand as per 1 employee per year. Another 400 projects within the framework of the START program are scheduled for financing in 2005.

The START program received a complex respond by scientific environment. So, manag ers of various RAS institutes and universities consider it as destruction of scientific organiza tions which top researches would resign from to get employed at small innovation business en terprises. Their opponents argue that a combination of research work or professorship at a According to the materials of the Conference on Innovative Management in Global Environment, September 22, 2004. . :

the RAS, 2004.

For description of the Start Program refer to : Russian Economy in 2003. Trends and Outlooks. Issue 25. .: IET, 2004. . 269270.

RUSSIAN ECONOMY in trends and outlooks higher education institution and establishing a small business company should be permitted.

Such requirements are likely to give evidence of poor viability of the institutes that can be ad versely effected by resignation of several researches. According to the practice of foreign countries, implementation of similar programs always requires either a full resignation of a re searcher from his/ her scientific organization or his/ her temporal employment at a small enter prise over a fixed period of time (2 to 3 years in general).

Both effectiveness and impact of the START program on development of small inno vation business remains to be seen, because it takes at least one year until definite find ings are revealed thus enabling success to be assessed: by this time small enterprises are expected to find an investor for further development. Only 3% of the candidates had found an investor by the time of selection of offers, while 12% had preliminary arrangements with potential investors45. In addition, only nearly 5% of the bidders had rights to objects of intel lectual property. The general picture is expected to be improved in one year of the START program. The estimated success of the program seems to be reliable, nearly 10%.

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