* China processed a quarter of world patents in 2011
* Most inventors Chinese, fastest growth in digital comms
* Beijing among worst protectors of copyright, patents
GENEVA, Dec 11 (Reuters) - China has overtaken the United States to become the world's biggest processor of patent applications, giving an innovative edge to Beijing's economic and industrial clout, a U.N. report said on Tuesday.
Inventors and firms, the vast majority of them Chinese, filed 526,000 applications to patent offices in the country in 2011, a quarter of the global total, said the U.N.'s World Intellectual Property Organization (WIPO).
"It's a historic turning point," WIPO Director-General Francis Gurry told Reuters after the report was released in Geneva.
"Even though caution is required in directly comparing IP (intellectual property) filing figures across countries, these trends nevertheless reflect how the geography of innovation has shifted," the annual report added.
The United States, which processed 503,000 applications in 2011, had been in the top spot since 2006. The only other past holders were Germany and Japan.
Gurry told journalists the data showed China was embracing the intellectual property system and he expected it would keep its lead in 2012.
"I would say that they are producing more, which would suggest they have a strong interest in the technological production being protected," he told a news briefing.
But any hope China markets had turned their back on knock-off goods and pirated brands was rubbished by another study on Tuesday, for the U.S. Chamber of Commerce, which ranked Beijing as one of the world's worst protectors of copyrights and patents.
The fastest growth in patent filings over the past five years came in the digital communications sector, said Carsten Fink, WIPO chief economist.
"On one hand this reflects technology opportunities that exist in this field, this is something we observe every day as we use our smart phones. But arguably it also reflects the fierce competition among innovating firms in this sector and the need to protect their intellectual property in the marketplace," Fink said.
Japan was in third with 342,610 patent applications filed in 2011, followed by South Korea with 178,924 and the European Patent office with 142,793, according to WIPO.
The European Union took a step closer to an EU-wide patent on Tuesday with lawmakers voting to cut the cost of protecting inventions and a top adviser to Europe's highest court rejecting a challenge to the new scheme.