Countdown to the End of the Innovation Patent: Abolition Legislation Signed into Law

On 26 February 2020, the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019 received Royal Assent (i.e. was signed into law by the Governor General of Australia), becoming Act No. 9 of 2020.  I reported passing of this Bill in the Senate, with amendments, in November last year, noting that its passage through the House of Representatives (which eventually occurred on 5 February 2020) was a mere formality.  The full text of the Bill, as passed, can be found on the Parliament of Australia website, and should soon be available as the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Act 2020 on the Federal Register of Legislation.

The main feature of the Act, about which I have written a number of times over the past few years, with varying degrees of ambivalence, is the abolition of Australia’s second-tier innovation patent system.  I briefly reviewed the history of the innovation patent’s downfall when reporting passage of the Bill through the Senate, and will not rehash this here.  The key point to note, however, is that the legislation provides for an 18 month window, commencing on the date of Royal Assent, before the phase-out of the innovation patent begins.  The following timeline has therefore now been established:

1. 26 February 2020 – Act receives Royal Assent;
2. 26 August 2021 – no longer possible to file new innovation patent applications, other than divisional applications based on applications filed on or before 25 August 2021; and
3. 25 August 2029 – final expiry date of all innovation patents (i.e. eight years after the last possible filing date of 25 August 2021).

The Bill originally provided a 12-month sunset period, however this was extended to 18 months by amendments in the Senate proposed by the Labor opposition, along with provisions requiring that a statutory review be undertaken to assess the impact on Australian small to medium enterprises of abolishing the innovation patent system, and make recommendations to facilitate access to standard patent protection for small business in Australia.  The review must commence within three months (i.e. by 26 May 2020), and provide a written report to the Minister for Industry, Science and Technology (currently the Hon Karen Andrews MP) within 12 months of commencement (i.e. no later than 26 May 2021).

To assist people with keeping track of the time remaining to file new innovation patents, I have added a countdown timer to the sidebar of this blog.  (You’re welcome!)  Notably, because 2020 is a leap year, and the Act received Royal Assent prior to 29 February and during daylight savings time, everyone has 25 hours more than would otherwise have been the case to file their final innovation patent applications!

While abolition of the innovation patent is, for most people, the big ticket item in the Act, it introduces a few other changes to Australia’s IP laws.  Read on for a brief summary of these.

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Tags: Australia, Compulsory license, Crown use, Innovation patent, Law reform, Omnibus claims

Greens Move to ‘Simplify’ Government Compulsory Licensing

The Australian Patents Act 1990 includes somewhat quaintly-titled ‘Crown Use’ provisions.  These essentially provide the government with the power to compulsorily acquire a licence to use a patented invention in the course of providing services to the public.

People in some parts of the world regard such compulsory acquisition provisions as an unconscionable imposition on the rights of a patent holder.  Yet Crown Use provisions have always been a part of the Australian patent laws.  Patent monopolies exist only as a result of legislation enacted by the Commonwealth, and it is understandable that the government might not want to place that kind of power in private hands without including some mechanism to avoid being held to ransom by a patentee.

Ultimately, this is about balancing the private interests of the patent owner with the public interest in ensuring that the government is not locked out from affordable access to new technologies in appropriate cases.

In practice, however, the Crown Use provisions have rarely been invoked and, when they have, it has generally been in the context of asserting a defence to infringement rather than in a pre-emptive effort to acquire a licence prior to exploiting a patented invention (see, e.g., Stack & GS Technology Pty Ltd v Brisbane City Council [1995] FCA 1427).

Changes to the Australian Crown Use provisions were recommended in the Productivity Commission Inquiry Report into the Compulsory Licensing of Patents.  The recommended changes were included in the Intellectual Property Laws Amendment Bill 2013, which passed in the House of Representatives despite a lack of support by the then-opposition Liberal-National Party coalition, but which failed to make it through the Senate before a general election was called (see Election Stalls Further Patent Law Reform in Australia).

When the amendments were reintroduced to parliament this year, as the Intellectual Property Laws Amendment Bill 2014, the changes to Crown Use that previously lacked opposition support had been excised.  Given this lack of support, I was surprised to see that when the Bill was debated in the House of Representatives (on 24 November 2014) the Greens’ Adam Bandt presented a proposed amendment which would have reintroduced the amendments to the Crown Use provisions, albeit in a slightly watered-down form.  So far, these proposed amendments have been rejected, but they may take on new life when the Bill is considered by the Senate.

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Tags: Australia, Compulsory license, Crown use, Law reform, Legislation

New IP Law Reform Bill Hits Australian Parliament

On Wednesday, 19 March 2014, the Intellectual Property Laws Amendment Bill 2014 was introduced into the Australian House of Representatives.

If passed (as seems likely), the bill will: implement Australia’s obligations under the TRIPS Protocol; provide for cheaper litigation options under the Plant Breeder’s Act; provide for single patent application and examination processes for Australia and New Zealand, and for a single trans-Tasman patent attorney regime; and implement a number of administrative changes and corrections in the Patents, Trade Marks and Designs Acts.

I last wrote about this bill back in January, when IP Australia released an exposure draft, calling for public comment.  No submissions in response to the call appear to have been published.  In any event, the version of the bill introduced into parliament last week is almost identical to the exposure draft.  I have prepared a marked-up copy showing the differences between the final version of the bill, and the exposure draft.  (My earlier document showing the changes between the 2013 version of the bill and the exposure draft is also still available.)

The one substantive change between the exposure draft and the final bill is that a proposal to repeal section 185 of the Patents Act 1990 has been abandoned.  If you are not familiar with section 185, you are not alone.  I do not think I have ever previously had cause to look at it, mainly because it applies only to officers and employees of IP Australia, and is therefore not a provision to which a patent attorney would normally need to refer. 

Basically, section 185 prohibits employees of IP Australia from doing certain things which have a clear potential to give rise to a conflict of interest, and which generally would therefore be contrary to the terms of their employment in the public service in any event.  It is not clear to me why the decision to repeal the section has been reversed, however it could be political expediency – someone may have felt that a proposal coming out of IP Australia to repeal an offence that could only be committed by its own employees could perhaps be regarded unfavourably.

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Tags: Australia, Compulsory license, Law reform, Legislation, New Zealand, Patent attorney profession, Politics

IP Australia Consults (This Time) On Further IP Law Amendments

[Update: This post was updated on 21 January 2014 in response to a clarification that I received from IP Australia.  The intention of the bill remains that Australia would extend the benefits of the TRIPS compulsory licensing provisions, for manufacture and export of generic pharmaceuticals to least developed countries, beyond the minimum requirements, so as to encompass non-WTO member countries.]

IP Australia has released an ‘exposure draft’ of a proposed Intellectual Property Amendment Bill 2014, and is inviting interested parties to make written submissions on the draft bill and associated draft explanatory memorandum by 7 February 2014.

The draft bill is a revised version of the Intellectual Property Laws Amendment Bill 2013, which narrowly missed out on being passed in the Senate (after having made it through the House of Representatives) when a Federal Election was called on 4 August 2013.  Among other things, the draft bill includes new provisions required for the implementation of a single patent application and examination process for Australia and New Zealand, amendments to enable the implementation of a single regulatory regime for patent and trade marks attorneys in Australia and New Zealand, and some further minor amendments to repeal unnecessary document retention provisions, and correct some oversights in the Intellectual Property Laws Amendment (Raising the Bar) Act 2012.

Unlike the earlier Raising the Bar reforms, which passed through both houses of parliament in 2012 with bipartisan support, the 2013 bill passed only by a narrow majority in the House of Representatives, with the then opposition (now government) conservative Liberal National Party (LNP) coalition voicing strong objections to two aspects of the legislation, namely:

1. amendments to the Crown use provisions of the Act, to implement recommendations made in the Productivity Commission Inquiry Report into Compulsory Licensing of Patents; and
2. introduction of new compulsory licensing provisions, implementing Australia’s obligations under the TRIPS Protocol to enable pharmaceutical manufacturers to apply to the Federal Court for a compulsory licence to manufacture generic versions of patented medicines to export to developing countries, based on draft legislation which was released for consultation in August 2012.

At the time I wrote (quite rightly, as it turns out):

Once the election is over, and a government has been formed, I would expect to see at least some of the provisions of the Intellectual Property Laws Amendment Bill reintroduced to parliament.

Now that the Raising the Bar reforms are all in operation, correcting the known issues and oversights in that earlier legislation should be a reasonably high priority.  And unless the next government wants to abandon the Trans-Tasman Single Economic Market program, it seems likely that the single filing and examination process and the single regulatory regime reforms will be reintroduced sooner rather than later.

It may, however, be back to the drawing board for the Crown use and TRIPS compulsory licensing provisions.

The new 2014 exposure draft retains all of the Raising the Bar corrections and Single Economic Market (SEM) reforms with only minor amendments, deletes the Crown Use amendments, and makes some substantive changes to the TRIPS provisions.  I have prepared a marked-up copy showing the differences between the 2013 Bill which passed in the House of Representatives, and the current exposure draft.

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Tags: Australia, Compulsory license, Crown use, Law reform, Legislation, New Zealand, Patent attorney profession, Politics

Election Stalls Further Patent Law Reform in Australia

On 4 August 2013, Australia’s Prime Minister, @KRuddMP (a.k.a. Kevin Rudd) announced that the country would go to the polls to elect a new Federal Government on 7 September 2013.  When that happened, the current government went into ‘caretaker mode’ (meaning that it cannot make any significant decisions without consulting the opposition), and all existing parliamentary business was suspended.

One consequence of this is that all legislation which has been introduced, but not yet passed in both houses of parliament, has lapsed, and will need to start the process all over again in the next parliament.  This is particularly unfortunate news for the Intellectual Property Laws Amendment Bill 2013, which was introduced in the House of Representatives on 30 May 2013, passed without amendment on 25 June 2013, and moved rapidly to the Senate, where it received its first and second readings (again without amendment) on 28 June 2013.  I can only suppose that had the Senate sat for even one more day before the election was called, the Bill would have passed.

The Bill was a bit of a grab-bag of both substantial and trivial amendments to the Patents Act 1990, along with a few minor amendments to the Trade Marks Act 1995, the Designs Act 2003, and the Plant Breeders Rights Act 1994.  The amendments affecting the Patents Act included:

1. amendments to the Crown use provisions of the Act, to implement recommendations made in the Productivity Commission Inquiry Report into Compulsory Licensing of Patents;
2. introduction of new compulsory licensing provisions, implementing Australia’s obligations under the TRIPS Protocol to enable pharmaceutical manufacturers to apply to the Federal Court for a compulsory licence to manufacture generic versions of patented medicines to export to developing countries, based on draft legislation which was released for consultation in August 2012;
3. new provisions required for the implementation of a single patent application and examination process for Australia and New Zealand;
4. amendments to enable the implementation of a single regulatory regime for patent and trade marks attorneys in Australia and New Zealand; and
5. some further minor amendments to repeal unnecessary document retention provisions, and correct some oversights in the Intellectual Property Laws Amendment (Raising the Bar) Act 2012.

To complicate matters further, the first two of these reforms (i.e. Crown use and the TRIPS compulsory licensing implementation) did not receive bipartisan support in the House of Representatives, being described by the opposition Member for Indi, Mrs Sophie Mirabella, as being ‘fine’ in basic intent, but poorly conceived and drafted, and ‘simply not ready for introduction into the parliament’.

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Tags: Australia, Compulsory license, Crown use, Law reform, Legislation, New Zealand, Patent attorney profession, Politics

Compulsory Licensing Inquiry Draft Report—Evolution, Not Revolution

The Australian Government’s Productivity Commission has released its draft report on the public inquiry into the Compulsory Licensing of Patents.

The inquiry was initiated in July this year (see Australian Public Inquiry into the Compulsory Licensing of Patents), and an issues paper was released in August, seeking public input by 28 September 2012 (see Compulsory Licensing Inquiry – Issues Paper Released).

The Commission is now inviting written comment on the draft report, prior to its finalisation and delivery to the government.  The deadline for public submissions is Friday, 8 February 2013.

We must confess that we are a little surprised – though not unpleasantly so – by the draft findings and recommendations in the report.  We had foreshadowed the possibility that the Commission’s remit of identifying ‘ways of achieving a more productive economy’ might lead to some significant proposals for change.  In fact, the draft report proposes only some relatively modest evolution and fine-tuning of the existing non-voluntary access provisions (i.e. compulsory licensing and Crown use).

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Tags: Australia, Compulsory license, Economics, Innovation policy, Law reform

Should Compulsory Licensing Provisions be Abolished?

We wrote recently about the ‘issues paper’ which has been released by the Australian Government’s Productivity Commission in relation to its inquiry into the compulsory licensing provisions in the Patents Act 1990 (see Compulsory Licensing Inquiry – Issues Paper Released).

On 15 August 2012, senior representatives of the Licensing Executives Society (Australia and New Zealand) – a.k.a. LESANZ – met with members of the Productivity Commission, at the Commission’s invitation.  Following the meeting, LESANZ published a summary, and an invitation to members to provide input to a formal written submission (currently available here, on the LESANZ web site, dated 16 August 2012).  This publication includes the intriguing statement that LESANZ proposed to the Commission that:

…consideration be given to replacing the existing statutory provisions with a streamlined, potentially deregulated access regime which better reflects market forces in technology transfer.

It is interesting to take this notion of ‘deregulation’ to its logical conclusion – the complete abolition of all of the non-voluntary access provisions (compulsory licensing, Crown use and compulsory acquisition) in the current Patents Act.

The fact is that these provisions are rarely used.  They are complex and expensive to invoke.  In many ways they are anachronistic, having their origins in an earlier time when there were genuine concerns that patent monopolies might be used by unscrupulous proprietors to slow the rate of industrialisation within the realm.  Such fears turned out to be largely unfounded – actually providing an increasingly affluent society with desired products and services has generally proven to be more lucrative than holding it to ransom!

So do we really have anything to fear from the abolition of non-voluntary access provisions, or would we be better off removing this burden from the statute books?  And how would someone go about persuading the Productivity Commission to recommend such radical reform?

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Tags: Australia, Compulsory license, Economics, Innovation policy, Law reform

Pharmaceutical Compulsory Licences to Assist Developing Nations

IP Australia has released an ‘exposure draft’ of proposed legislation named the Intellectual Property Laws Amendment Bill 2012.  The main purpose of the legislation is to implement additional compulsory licencing provisions consistent with Australia’s obligations under the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Protocol.  The Protocol is aimed at helping developing nations to tackle diseases such as malaria and HIV/AIDS using affordable generic medicines from other countries. 

IP Australia is currently welcoming submissions on the exposure draft, up until 5.00pm, on 1 October 2012.

The Australian Government (then Innovation Minister Senator Kim Carr and Trade Minister Dr Craig Emerson) originally announced, in March last year, its intention to have this legislation drafted and in place by the end of 2011.  It then disappeared without a trace, until now!

We recently wrote about the Productivity Commission’s inquiry into the compulsory licensing provisions of the Australian Patents Act 1990, which is currently accepting public submissions (see Compulsory Licensing Inquiry – Issues Paper Released).  This inquiry is concerned with the domestic impacts of patents and compulsory licences – the primary focus of the Productivity Commission is on ways of achieving a more productive Australian economy, which is seen as the key to higher living standards for the country’s citizens.

Australia’s existing compulsory licensing provisions are consistent with the World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property (the TRIPS Agreement).  According to TRIPS, products made under compulsory licence must be predominantly for the supply of the domestic market and are not allowed to be exported. 

This restriction makes sense to protect rights-holders in advanced economies, which do not wish to see an influx cheap imported goods from countries where they are manufactured under favourable compulsory licence terms. 

However, the WTO recognises that less-developed member countries may find themselves facing problems in the event of a public health crisis, such as an HIV/AIDS, malaria or influenza epidemic, if they have insufficient capacity to manufacture pharmaceuticals themselves, and can not afford to purchase the required drugs on the open market.  Such countries cannot obtain patented pharmaceuticals produced under compulsory licence in another WTO country, even if they are more affordable, because these products could not be exported under current laws.

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Tags: Australia, Compulsory license, Law reform, Legislation, Pharmaceuticals

Compulsory Licensing Inquiry – Issues Paper Released

As we have reported previously, the Australian Government has asked its Productivity Commission to conduct a nine-month inquiry into the compulsory licensing provisions in the Patents Act 1990 (see Australian Public Inquiry into the Compulsory Licensing of Patents).

As a first step in this inquiry, the Commission released an issues paper on 9 August 2012. The purpose of the issues paper is to clarify the scope of the inquiry, and to assist interested parties in preparing submissions to the Commission.  The paper covers a range of issues on which the Commission is seeking information and feedback.

The deadline for submissions is Friday, 28 September 2012.  Details of how to make a submission are provided in the issues paper, and on the Commission’s web site.

COMPULSORY LICENSING

As the issues paper points out, most countries have adopted mechanisms – including compulsory licensing – to enable, in limited circumstances, access to patented inventions without the permission of the patent holder.  The mechanisms are generally seen as a safeguard for exceptional cases in which the patent system may fail to provide the best outcome for the community as a whole.  Examples include the failure of a patent holder to exploit the patented invention so that it is made sufficiently available to the public, the need to satisfy important public health or security objectives, and cases in which a patent is used in an anticompetitive manner.

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Tags: Australia, Compulsory license, Economics, Innovation policy, Law reform

Australian Public Inquiry into the Compulsory Licensing of Patents

The Australian Government has asked its Productivity Commission to conduct a nine-month inquiry into the compulsory licensing provisions in the Patents Act 1990. 


The stated purpose of the inquiry is to ‘assess, advise and recommend on the impacts and mechanisms of compulsory licensing invoked by the Patent Act's public interest and anti-competitive safeguard.’

The Terms of Reference require the Commission to:

1. assess whether the current Australian provisions can be invoked efficiently and effectively;
2. recommend any measures to efficiently and effectively exercise these safeguard provisions, in a manner consistent with Australia's international obligations; and
3. recommend any alternative mechanisms, to ensure that the balance between incentives to innovate and access to technology best reflects the objectives of reasonable access to health care solutions, maximising economic growth and growing the Australian manufacturing industry.

The inquiry will be relatively wide-ranging, taking into account an number of specific areas of sensitivity and public interest, including access to affordable healthcare, impact of gene patents, climate change mitigation, food security and alternative energy technologies, and technical standards essential patents.  It will also look at comparisons with compulsory licensing provisions in other jurisdictions, and consider how the provisions interact with crown use (i.e. provisions enabling government authorities to compulsorily acquire patent licenses) and the new research exemption to infringement introduced by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (see Bar Raised, as IP Law Reforms Signed Into Law).

The Commission is inviting submissions from interested stakeholders, and will be conducting public hearings.

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Tags: Australia, Compulsory license, Economics, FRAND, Genetic technology, Innovation policy

Surprise! New Pharmaceutical Compulsory Licenses Proposed

We cannot speak for any other interested parties (although we will gladly quote them – see below) but we were blind-sided by the joint announcement yesterday by Senator Kim Carr (the Australian Minister for Innovation, Industry, Science and Research) and the Hon Dr Craig Emerson MP (Minister for Trade) of the Government’s intention to ‘introduce legislation to allow Australian courts to grant compulsory licences to manufacture and export patented pharmaceuticals to countries trying to deal with epidemics and other types of health crises.’

According to the joint media release:

The new system implements an international agreement on public health in the World Trade Organization, amending the Agreement on Trade-Related Aspects of Intellectual Property Rights (the TRIPS Protocol).

Developing countries and other interested organisations will now be able to apply to the Federal Court for a licence to manufacture and export patented pharmaceuticals from Australia to countries in need.

Apparently (and this is entirely independent of the reforms currently in-train on the initiative of IP Australia), the Government intends that the new system will be in-place by the end of 2011.

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Tags: Australia, Compulsory license, Law reform, Legislation, Pharmaceuticals