Technology and manufacturing development

Primax Electronics's continuous profitability and growth are primarily attributed toits embrace of innovation. The company's focus on technology development lies in the integration of acoustics, visuals, and human-machine interfaces, known as "three-sensesin-one" product applications. In an era of constant technological advancements, Primax Electronics strives to develop key new technologies and products that sustain profitability and extend its business into every individual's living environment. In 2022 , the company investeda total of NT$ 3 , 366 million in research and development (R&D), accounting for 4 . 25 % of its operating income. Details of the R&D achievements in recent years can be found in the《Shareholders' Meeting Annual Report, Pages 98 to 100》。

In terms of production and global expansion, Primax Electronics continues to serve globalIn terms of production and global expansion, Primax Electronics continues to serve globalcustomers with the motto of "Taiwan R&D, Smart Manufacturing, and Global Logistics." The planned Zhubei Innovation Center in Taiwan is expected to include advanced laboratories,industry-academia collaboration centers, and new product manufacturing centers. Primax will continue to expand its global manufacturing footprint. In addition to its main production basein mainland China, the company will deepen production at its manufacturing base in Thailand. Furthermore, this year, Primax will invest in establishing a facility in North America to achieve regionalized customer service.

Intellectual property rights management

Strategies and Goals

In order to align with advanced technology tendency and protect technical achievement, we continuously engross sufficient resources in R&D and analysis for the variation of marketing and technology in relation to our products. We also formulate intellectual property policy which integrates the operation goal and R&D resources so as to reinforce the advantage in competition. In addition to integrate and upgrade the regulations for IP management, we keep strengthening the patent capability as well as the protection for non-patent R&D results to ensure that the intellectual property rights targeted are consistent with the main products and key technology of the Company. To protect the main products and key technology of the Company, we encourage colleagues to innovate and keep a watch on the products and patents of competitors so as to reinforce the patent layout and formulate the best patent strategy. We target to be the top thirty of Taiwan Patent Applications by 2030.

Our intellectual property tactics as described below：

• Implement the intellectual property regulations
• Carry out the quality management of patent and the encouragement of innovation
• Reinforce the patent layout
• Implement the intellectual property management
• Implement the management of confidential document
• Implement the management for research and technical notebook

Management plan for intellectual property rights

Management of patent

For the purpose of protection of technical achievement and leading position, we not only constantly encourage our staff to file application for utility patent via the corporate innovation award, but also establish the patent management policy and risk control mechanism. In addition, the quantity and quality for patent application has been managed by means of AI analysis through the entertainment patent system. We contact and cooperate with the patent competent authority closely to raise efficiency of patent examination and acquire the high-level patent protection. We also take efficient actions to reduce patent risk. We strive to monitor the competitors of certain products and analyze relevant market and patent information.

Management of Copyright  

We promulgated Regulation of Copyright to formulate the process of acquirement, preservation and maintenance of copyright.

Protection of trade secrets

Trade secret and confidential information are the technological and business operation core of the Company. The regulations with regard to trade secret and confidential information have been stipulated in Regulation and Procedure of confidential documents, Employee Handbook and Employee Contract. We also provide our staff with the training courses to disseminate the importance and protection measures of trade secret and confidential information.

Operation

The report of the implementation of intellectual property events has been submitted to the Board of Directors on Nov.8, 2023.

We have carried out the management of intellectual property rights since 1990, the details are listed as follows：

Application of patent

Primax group has filed numerous patent applications in countries since 1990.

Process management

• In 1990: We formulated and promulgated Regulation of Patent Application.
• In 2002: Regulation of Risk Management and Patent Usage was put into force.
• In 2004: The Enterprise Patent System was introduced.
• In 2021: Regulation of Copyright and Regulation of Trade Secret were put into force. In addition, the AI analyze system was introduced for data calculation to identify the valuable innovative employee.
• In 2022：Procedure of Copyright and Procedure of Trade Secret were put into force.
• In 2023：Procedure of patent, Regulation and Procedure of IP confidential documents were put into force.
• In 2024：Amend the Procedure of patent, the Procedure of confidential documents.

Activation of Property

To realize Patent Monetization, we sold almost 900 patents in 2006.

Risk Control

To reduce the patent risk during the period of product development, we have carried out the management of patent search archive since 2012.

Management of trade secret

The provisions of trade secret which have been stipulated in Regulation of IP confidential documents, Employee Handbook and Employee Contract are summarized below：

• It’s staff’s duty to maintain secrecy pertaining to his work and the company’s business.
• Staff shall not disclose, inform, provide or transfer such Confidential Information to third party, or announce to public or make use for third party of such Confidential Information during and after the termination of employment period. We are eligible to request the staff who breaches the foregoing to compensate the damages incurred by the Company and the said staff will be punished by Section 317 of Criminal Code of the Republic of China on account of offense of disclosing trade secret knew or possessed because of occupation.
• Staff shall not disclose or use the trade secret owned by his former employer.

Measures for dealing with the risk of intellectual property rights

We occasionally receive the notices from third parties who assert that our products may involve in the controversy of intellectual property rights. We respect and try not to infringe third parties’ intellectual property rights for all time. In view of the foregoing, we will analyze the related issues pertaining to legitimate, technical and business aspects to formulate the best tactics for resolution of the IP controversy so as to protect the Company’s and stakeholders’ interests.

Performance

As of the end of 2023, 897 patents of Primax Electronics Ltd. have been approved while 467 patents are pending in countries.

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