17 May 2011

Australia Has Third Best IP Regime in the World, Says Survey

European-based IP law firm, Taylor Wessing, has released its third Global Intellectual Property Index (GIPI) report, which rates 24 jurisdictions according to their support for obtaining, exploiting, enforcing and challenging IP rights.

According to the GIPI report, which is available free for download (subject to registration), Australia ranks third in the world, after Germany and the UK, and ahead of the USA, Canada and the Netherlands, which round out ‘tier 1’.  New Zealand comes in at number 11, just scraping into ‘tier 2’.  At the bottom of the list, in ‘tier 5’, are Brazil, China and India.

This is all very well, but what (if anything) does it all mean?  In this article we take a look at just one aspect of the GIPI – the patent index – in which Australia also happens to rank third.

INFORMATION SOURCES

The GIPI is based on a survey of users of the IP system, i.e. commercial organisations actively involved in the generation, protection, enforcement, defence and challenge of IP rights.

The survey is available online, and runs continuously.  That is, anybody can respond at any time.  However, the published GIPI is only updated periodically.

According to Taylor Wessing’s report, the current results are the statistical output from a worldwide survey providing over 14,000 assessments, drawing data from 50 objective sources (or ‘instrumental factors’).  The largest numbers of assessments have been received for the USA (1643), the UK (1613), Germany (1499), China (861), Canada (775), and Australia (735). 

Participants in the survey are self-selecting, and individuals completing the survey (though not companies) can elect to remain anonymous.  There is nothing in the online survey itself to prevent fabrication of data, although we suppose that Taylor Wessing might itself perform cross-checks of information against other sources (such as company websites) to assess the credibility of responses before including them in the results.

PATENT ASSESSMENT

A ‘patent index’ is determined based upon responses to a number of survey questions.  These are not set out in the GIPI Report, but can easily be obtained simply by working through the online survey.

For each question, the survey suggests ‘factors’ that might be pertinent to the response, as set out below.
Rating for obtaining and maintaining patents (1 = very poor, 10 = excellent)
  1. Speed and cost of securing protection.
  2. Availability of competent professionals.
  3. Complexity of formalities associated with filing and prosecution.
  4. Availability of judicial oversight of administrative procedures.
  5. Level of respect for patent rights.
  6. Membership of international treaties.
  7. Cost and ease of renewals.
Rating for dealing in and exploiting patents (1 = very poor, 10 = excellent)
  1. Adequacy and clarity of law.
  2. Cost-effectiveness and efficiency of enforcement of agreements.
  3. Availability of competent professionals.
  4. Support through tax regime.
  5. Availability of finance/capital.
  6. Complexity of formalities associated with patent transactions/licences.
Rating for enforcing patents (1 = very poor, 10 = excellent)
  1. Adequacy and efficiency of court procedures.
  2. Competence, reputation and specialisation of judges.
  3. Whether courts/tribunals are viewed as generally pro- or anti-patentee.
  4. Availability of competent professionals.
  5. Speed of obtaining judgment on merits.
  6. Overall costs, including challenges to validity and assessing compensation.
  7. Availability of adequate remedies, including interim remedies.
  8. Possibility of enforcement through public bodies and criminal sanctions.
Rating for challenging patents (1 = very poor, 10 = excellent)
  1. Public accessibility of register to identify ownership and status of patents.
  2. Adequacy of court/registry procedures pre- and post- registration.
  3. Competence, reputation and specialisation of judges and other decision-makers.
  4. Availability of competent professionals.
  5. Whether courts/tribunals are viewed as generally pro- or anti-patentee.
  6. Speed and cost of obtaining judgment on merits.

OUR ASSESSMENT

Based upon the above criteria, we consider that the assessment of the responding users of the Australian patent system is fairly consistent with our own views and experience.

Australia obtained the highest score in the survey for the sub-category of obtaining and maintaining patents.  This is perhaps unsurprising, considering that Australia’s ‘examination request’ system generally results in Australian patent applications being examined later than counterparts in major jurisdictions such as the US and Europe.  Outcomes elsewhere will generally assist prosecution in Australia.  Costs have generally been very competitive, although currently less so with the present strength of the Australian dollar.

Australian also scored highly for exploitation, being bettered only by the US and Germany.

Germany, the US, the UK and the Netherlands all outscored Australia on enforcement.  This is perhaps a little surprising, compared to the other sub-indices, considering the generally pro-patent stance of Australian courts over at least the past three decades.  However, court proceedings in Australia can be slow and expensive (relative to the size of the market) due to the strong reliance upon expert evidence on most questions of patent infringement and validity.  Yet on cost-effectiveness of enforcement Australia fared relatively better, coming fourth after Germany, the Netherlands and France.

Australia is surprisingly high on the list for the sub-category of challenging patents, considering how difficult it can be to invalidate claims under the current Australian law.  However, Australia does have the benefit of a pre-grant opposition period, and a relatively accessible and low-cost (although not necessarily highly effective) re-examination procedure which, for example, the US (which scores marginally better than Australia on this sub-index) does not.

CONCLUSION

The GIPI results suggest that users of the Australian patent system (at least those that responded to the survey) are reasonably satisfied with its performance.  This appears somewhat at odds with the opinions of some of the major stakeholders in the system – not least its administrators at IP Australia – who consider that the Australian patent laws and procedures are in urgent need of reform in order to raise standards, and improve efficiency.

However, the suggested assessment criteria are more concerned with aspects such as relative expertise (of advisors and and decision–makers), certainty, effectiveness of the judiciary, and respect for the rule of law, than they are with absolute measures of ‘quality’.

It will therefore be interesting to see, if and when the presently proposed reforms are introduced (see Australian Patent Reform – Wrap-Up), whether Australia’s ranking on the GIDI moves up or down.

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