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Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019
Administered by: Industry, Innovation and Science
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Registered 26 Jul 2019
Introduced Senate 25 Jul 2019
Table of contents.

2019

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

SENATE

 

 

 

 

 

INTELLECTUAL PROPERTY LAWS AMENDMENT (PRODUCTIVITY COMMISSION RESPONSE PART 2 AND OTHER MEASURES) BILL 2019

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

(Circulated by authority of the Minister for Industry, Science and Technology,
the Honourable Karen Andrews MP)



Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019

Background

The objective of the intellectual property (IP) rights system is to support innovation by encouraging investment in research and technology in Australia, and by helping Australian businesses benefit from their good ideas. The Australian Government proposes improvements to Australia’s IP rights legislation to better meet these objectives.

The Productivity Commission (PC) completed its public inquiry into Australia’s IP Arrangements and published the final inquiry report on 18 August 2016 (2016 PC Report).[1] The Government asked the PC in its inquiry to consider whether current IP arrangements provide an appropriate balance between access to ideas and products, and encouraging innovation, investment and the production of creative works. The then Minister for Industry, Innovation and Science and the Minister for Communications announced the release of the Government’s response to the 2016 PC Report on 25 August 2017. The 2016 PC Report included a number of recommendations on IP matters, which received support from the Government.[2]

In 2018, the Government introduced the Intellectual Property Laws Amendment (Productivity Commission Response Part 1 and Other Measures) Bill 2018 into the Commonwealth Parliament. That Bill received royal assent on 24 August 2018.The Intellectual Property Laws Amendment (Productivity Commission Response Part 1 and Other Measures) Act 2018 addressed several recommendations concerning the trade mark and the plant breeder’s rights systems made by the 2016 PC report. It also made a number of other changes to modernise certain aspects of the IP system.

Outline

The purpose of the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019 (the Bill) is to make improvements to implement the second set of legislative measures in response to the 2016 PC Report. The Bill also proposes a number of technical fixes to the Australian IP system.

The Bill’s proposed amendments to the Patents Act 1990 (Patents Act), Designs Act 2003 (Designs Act) and Trade Marks Act 1995 (Trade Marks Act) can be divided into eight categories, corresponding to the following eight schedules:

·         Schedule 1 – Responses to the Productivity Commission

·         Schedule 2 – Crown use of patents

·         Schedule 3 – Crown use of designs

·         Schedule 4 – Compulsory licences

·         Schedule 5 – Seals

·         Schedule 6 – Specifications

·         Schedule 7 – Protection of information

·         Schedule 8 – International applications

Schedule 1: Responses to the Productivity Commission

Schedule 1 to this Bill will give effect to two recommendations in the 2016 PC Report that are now ready for implementation. These measures have been drafted in light of stakeholder feedback that IP Australia received during public consultation from 30 August to 17 November 2017 and from 23 July to 31 August 2018.

These recommendations are:

·         Introduce an objects clause into the Patents Act (recommendation 7.1)

·         Abolishing the innovation patent system (recommendation 8.1)

The PC recommended that an objects clause be included in the Patents Act.[3] An objects clause is a provision, usually found at the beginning of legislation, which gives readers a general understanding of the legislation’s purpose, or sets out general aims or principles that help readers to interpret its detailed provisions. The PC considered that inclusion of an objects clause would help ensure that the patent system remains adaptable and fit-for-purpose, particularly as new technologies emerge and as economies and business models evolve. The PC also considered that an objects clause would help frame policy debates and reform. Part 1 of Schedule 1 to the Bill will insert an objects clause into the Patents Act.

The PC[4] and the former Advisory Council on Intellectual Property (ACIP)[5] have recommended that the innovation patent system be abolished. Both found that the innovation patent system is unlikely to provide net benefits to the Australian community or to the small and medium sized enterprises (SMEs) who are the intended beneficiaries of the system. The PC found that the majority of SMEs who use the innovation patent system do not obtain value from it, and that the system imposes significant costs on third parties and the broader Australian community. Given the overall lack of net benefits, the Government made the decision to abolish the innovation patent system.

Details of these amendments to the Patents Act are set out below in the notes on Schedule 1 to the Bill.

Schedules 2 and 3: Crown use of patents and designs

The Government’s response to the 2016 PC Report also noted that the Government would consult further on the following recommendation made by an earlier report by the PC, Compulsory Licensing of Patents in 2013 (2013 PC Report)[6]:

·         Amend the provisions for Crown use of patents (2013 PC Report recommendations 7.1 and 7.2)

Crown use is a mechanism in the Patents Act and the Designs Act that allows Australian Federal, State and Territory governments to access and use patented technology and registered designs without the authorisation of the patentee or registered owner. A number of reviews in the past have recognised problems with the existing Crown use provisions. Building on these earlier reviews, the 2013 PC Report made several arguments for reform of the Crown use provisions for patents.

From 30 August to 17 November 2017 and from 23 July to 31 August 2018, IP Australia consulted the public on proposed changes to the Crown use provisions in the Patents Act and the Designs Act, and has taken stakeholder feedback into account in drafting the proposed amendments. Since the provisions for Crown use in the Designs Act are equivalent to those in the Patents Act, equivalent amendments to the Crown use provisions in the Designs Act are proposed in Schedule 3 to the Bill.

Details of the amendments to the Patents Act and the Designs Act are set out below in the notes on Schedules 2 and 3 to the Bill respectively.

Schedule 4: Compulsory licenses

The Government’s response to the 2016 PC Report also noted that the Government would consult further on the following recommendation made by the 2013 PC Report:

·         Amend the provisions for compulsory licensing of patents (2013 PC Report recommendation 6.2)

Compulsory licencing is one of several safeguards in the Patents Act that allow a patented invention to be used without the authorisation of its owner. These safeguards can be invoked in exceptional circumstances where exercising the exclusive rights associated with a patent would not serve the best interests of the community.[7] The 2013 PC report and other reviews have raised issues with, and recommended amendments to, the compulsory licensing provisions.

From 30 August to 17 November 2017 and from 23 July to 31 August 2018, IP Australia consulted the public on proposed changes to the compulsory licensing provisions in the Patents Act and the Designs Act, and has taken stakeholder feedback into account in drafting the proposed amendments.

Schedule 4 to the Bill would amend the Patents Act to address these issues. Details appear in the notes on that Schedule below.

Schedules 5, 6, 7 and 8: Other measures

Schedules 5, 6, 7 and 8 to the Bill are proposed to make a number of minor technical fixes to the Patents Act and Trade Marks Act:

·         Schedule 5 – Seals (both Acts)

·         Schedule 6 – Specifications (Patents Act only)

·         Schedule 7 – Protection of information (Patents Act only)

·         Schedule 8 – International applications (Patents Act only)

Collectively, the measures in these schedules are proposed to address a small number of errors and inconsistencies in the IP legislation, and to improve the way IP Australia is able to deliver service to its customers by reducing the time both customers and IP Australia need to spend on administrative matters.

From 23 July to 31 August 2018, IP Australia consulted the public on proposed changes in Schedules 5-7. Stakeholders were subsequently consulted on the changes to Schedule 8.

Details of the amendments to the Patents Act and the Trade Marks Act are set out below in the notes on those Schedules.

Financial impact statement

The Bill is expected to have no financial impact on the Commonwealth.


 

Statement of compatibility with human rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019

This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Bill

The Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019 makes amendments to several areas of Australia’s IP legislation including the Designs Act, Patents Act and the Trade Marks Act.

The Bill makes the following amendments:

Schedule 1: Responses to the Productivity Commission[8]

·         Part 1 amends the Patents Act by inserting an objects clause to provide additional clarity and guidance on the purpose of the Patents Act.

·         Part 2 amends the Patents Act to phase out the innovation patent system, with arrangements to maintain existing rights.

Schedule 2: Crown use of patents

·         Schedule 2 amends the Crown use provisions in the Patents Act to clarify the circumstances in which Crown use can be invoked; to improve Government transparency and accountability when invoking Crown use by requiring Ministerial oversight to authorise this use; and to provide a more clearly defined remuneration standard to be paid to the patent owner.

Schedule 3: Crown use of designs

·         Schedule 3 amends the Crown use provisions in the Designs Act in the same manner as that described in Schedule 2; to maintain consistency between the Crown use provisions in the Designs Act and the Patents Act.

Schedule 4: Compulsory licences

·         Schedule 4 amends the Patents Act by introducing the ‘public interest’ test to replace the ‘reasonable requirements of the public’ test when the Court considers an application for a compulsory licence. The ‘public interest’ is also to be considered when determining the terms of the licence, including remuneration.

·         Schedule 4 also amends the Patents Act to clarify the operation of the additional provisions for the grant of a compulsory licence which must be satisfied where an applicant seeks a compulsory licence in order to exploit an invention which is dependent (‘the dependent invention’) on an earlier patented invention (‘the original invention’) and would be unable to exploit the dependent invention without infringing the original invention.

Schedule 5: Seals

·         Schedule 5 amends the Patents Act and Trade Marks Act to enable the Patent Office and the Trade Mark Office to keep and use their official seal in electronic form when supplying electronic certified copies of documents to customers.

Schedule 6: Specifications

·         Schedule 6 amends the Patents Act to provide for claims in patent specifications relying on references to descriptions or drawings that are not absolutely necessary to define the invention (‘omnibus claims’) to be removed at stages of consideration subsequent to examination.

Schedule 7: Protection of information

·         Schedule 7 amends the Patents Act to clarify the Commissioner of Patents’ power to redact sensitive information from patent documents, including the power to partially or wholly redact a document, and publish a redacted version.

Schedule 8: International applications

·         Schedule 8 amends the Patents Act to remove the requirement to file a certificate of verification for documents translated into English, unless the certificate is required by the regulations.

Human rights implications

The Bill engages the following human rights:

·         the right to privacy – Article 17 of the International Covenant on Civil and Political Rights (ICCPR)

·         the right to enjoy the benefits of scientific progress and its applications – Article 15(1)(b) of the International Covenant on Economic, Social and Cultural Rights (ICESCR)

·         the right to the protection of interests resulting from one’s scientific and artistic production – Article 15(1)(c) of the ICESCR

Right to privacy

Article 17 of the ICCPR provides that no one shall be subjected to an arbitrary or unlawful interference with their privacy, family, home, or correspondence, nor to unlawful attacks on his honour and reputation. The right to privacy is engaged when personal information is collected, used, stored and shared. In order for an interference with the right to privacy to not be ‘arbitrary’, the interference must be for a reason consistent with the provisions, aims and objectives of the ICCPR and be reasonable in the particular circumstances.

Schedule 7 – Protection of information

Schedule 7 amends the Patents Act to clarify the power held by the Commissioner of Patents when redacting sensitive information from patent applications and associated documents. The power to redact information is important as patent applications and associated documents can contain sensitive information, such as personal or commercial information, which is not appropriate for public consumption. As all patent applications are made publicly available, the Commissioner must ensure that the privacy of the applicants is protected, especially where such information is not essential to understanding the invention specified in the patent application. 

For patent applications received under the Patent Cooperation Treaty (PCT), both the International Bureau of the World Intellectual Property Organization (WIPO) and IP Australia has the power to omit sensitive information from such applications.

For standard and innovation patent applications, the Commissioner has the power to redact ‘documents’ under the Patent Regulations 1991 (Patent Regulations), rather than ‘information’. As a result, it is unclear whether the Commissioner has the power to redact parts of a patent document as opposed to an entire document.

The amendments will resolve the ambiguity by clarifying that the Commissioner is allowed to redact sensitive information from a patent document, regardless of whether it is partial or whole redaction of a patent document, and to publish the redacted version.

Therefore, Schedule 7 positively engages with the right to privacy as it clarifies the ability of the Commissioner to protect the privacy of patent applicants. The Schedule unequivocally grants the Commissioner the power to redact sensitive information from patent applications. This amendment promotes the right to privacy in accordance with Article 17 of the ICCPR.

Right to enjoy scientific progress and right to protection of interests resulting from scientific production

Article 15(1)(b) of the International Covenant on Economic, Social and Cultural Rights (ICESCR) recognizes the right of everyone to enjoy the benefits of scientific progress and its applications. Article 15(1)(c) of the ICESCR recognizes the right of everyone to benefit from the protection of the moral and material interests resulting from any scientific, literary, or artistic production of which he or she is the author.

Schedule 1, Part 2 – Innovation patents

Schedule 1, Part 2 of the Bill amends the Patents Act by abolishing the innovation patent system.

The IPS was established with the intention of promoting innovation by protecting those innovations or inventions that would not meet the threshold of a standard patent. The policy intention of the IPS was to encourage SMEs to innovate and benefit from their scientific progress. In practice however, the innovation patent system has been found to have limited use by SMEs as 74 per cent of SMEs and private inventors filed once and never again; 83 per cent never received an enforceable right; and 78 per cent let their innovation patent expire early rather than pay the minor cost of the renewal fee.[9] The Productivity Commission found that the majority of SMEs who use the innovation patent system do not obtain value from it, and that the system imposes significant costs on third parties and the broader Australian community.[10] Given this, the innovation patent system has shown to be unlikely to provide net benefits to the Australian community or to the SMEs who are the intended beneficiaries of the system.

Abolishing the innovation patent system will improve the ability of the public to benefit from scientific and technical progress by ensuring that trivial or undeserving innovations are not the subject of an innovation patent. However, abolishing the innovation patent system will not prevent SMEs from being able to benefit from their scientific production. SMEs will be able to access the standard patent system, allowing them to gain greater protection for their inventions, and increasing the incentive for them to pursue higher level innovation. The abolition of the innovation patent system is consistent with Articles 15(1)(b) and 15(1)(c) of the ICESCR as SMEs and other scientific producers and innovators will still be able to protect their interests through the standard patent system, while the public will benefit from a better balanced IP system enhancing its ability to enjoy the benefits of scientific progress.

Schedule 2, Part 1– Crown use of patents

Schedule 2, Part 1 of the Bill amends the Patents Act to improve and clarify the operation of the Crown use provisions.

Crown use is a mechanism in the Patents Act that allows Australian Federal, State and Territory governments to access and use patented technology without the authorisation of the patent owner. These provisions are a rarely used safeguard which allow the Government to step in and access a particular technology, when such action is necessary to deal with an emergency or other public interest issue (for example, a pandemic).

The amendments will clarify the circumstances in which Commonwealth, State or Territory government agencies can utilise the Crown use provisions and will set out the new process a Government agency must satisfy to rely on these provisions.

The amendments will increase accountability, certainty, and transparency in the Crown use provisions to the benefit of patent owners. As a result, this will strengthen the ability of patent owners to protect their interests resulting from their scientific production and is consistent with Article 15(1)(c) of the ICESCR.

Schedule 3, Part 1 – Crown use of designs

Schedule 3, Part 1 of the Bill amends the Designs Act to improve and clarify the operation of the Crown use provisions and is consistent with the amendments made to the Crown use provisions of the Patents Act under Schedule 2, Part 1 of the Bill. As such, the amendments made under this Schedule will assist design owners to protect their interests resulting from artistic production, in accordance with Article 15(1)(c) of the ICESCR.

Schedule 4 – Compulsory licences

Schedule 4 of the Bill amends the compulsory licensing provisions of the Patents Act. 

A compulsory licence is an order made by the Federal Court for a patentee to grant a licence to another party to exploit an invention. Compulsory licensing provides a mechanism to prevent the patentee from restricting others from exploiting the invention in the local market, where it has failed to do so itself. It is a rarely used safeguard which provides confidence to the public that products which are in demand will continue to be available.

The amendments replace the existing ‘reasonable requirements of the public’ test with a ‘public interest’ test, which the Federal Court must take into account when deciding whether an application for a compulsory licence should be granted. The amendments will also require the court to ensure that the terms of the licence are consistent with the public interest. Unlike the term ‘reasonable requirements of the public’, the term ‘public interest’ is a commonly used legal term which has been interpreted in a wide variety of circumstances by the courts. This amendment will improve the clarity and certainty of the legislation.

The purpose of these amendments is to improve the balance between the rights of the patent owner and the interests of the broader public. These amendments will more effectively safeguard the right of the public to enjoy scientific progress, while providing a reasonable balance to ensure that the interests of the patentee are protected, including adequate remuneration for the use of their invention and the opportunity for judicial review. These amendments are consistent with Articles 15(1)(b) and (c) of the ICESCR.

Remaining parts do not raise any human rights issues

These parts are Schedule 1, Part 1; Schedule 2, Part 2; Schedule 3 Part 2; Schedule 5; Schedule 6; and Schedule 8.

Conclusion

The Bill is compatible with human rights because to the extent that it limits any human rights, those limitations are reasonable, necessary and proportionate.

The Hon Karen Andrews MP, Minister for Industry, Science, and Technology


 

Notes on clauses

Clause 1: Short title

1.                  Upon enactment, the Bill will be known as the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Act 2019.

Clause 2: Commencement

2.                  Schedule 1, Part 2 (innovation patents) in the Bill will commence 12 months after the day the Bill receives the Royal Assent. An extended commencement for Part 2 is necessary to ensure the existing rights of patent applicants are maintained.

3.                  Currently the timeframe for filing an innovation patent application that claims priority from a provisional or basic application is 12 months, so this commencement timeframe will ensure that applicants who have filed a provisional or basic application before the Royal Assent date will continue to have the full 12 months to file an innovation patent. Applicants whose provisional or basic application is filed sometime between Royal Assent and the commencement of Schedule 1, Part 2 will have whatever period remains until that commencement to file an innovation patent, but will still have 12 months to file a standard patent.

4.                  The commencement provisions specify a fixed date to give stakeholders certainty. It is preferable that there be no facility for the Executive to shorten the 12-month commencement period, as this would make it difficult for users of the patent system to plan how they will prosecute their patent applications and to maintain their existing rights. Accordingly, there is no Executive discretion to fix an earlier commencement date.

5.                  Schedule 8 will commence six months after the Royal Assent of the Bill. This change, along with associated regulations, will make changes to how applicants must file translations of international applications that were not filed in English. A six month commencement will give stakeholders time to consider how the changes to translations will affect their applications and to comply with the new requirements, given that translations may take applicants a few months to procure. However, the changes should in most cases reduce the burden on applicants providing translations, so six months reflects and appropriate balance between allowing time for applicants to adjust to the changes, and the desirability of introducing these changes as soon as possible.

6.                  The extended commencement will not apply to Schedule 1, Part 1 and Schedules 2 to 7. These items relate to matters which will not affect how applicants prosecute their applications. Given this, it is desirable to provide certainty sooner by commencing these provisions on the day after the Royal Assent.

Clause 3: Schedules

7.                  The Patents Act, the Designs Act and the Trade Marks Act are to be amended as set out below in Schedules 1 to 8 to the Bill.

Schedule 1 - Responses to the Productivity Commission

Part 1 - Object of the Act

Introduction

8.                  This Part amends the Patents Act to insert an objects clause to provide additional clarity and guidance on the purpose of the legislation.

9.                  Currently the Patents Act does not contain an objects clause. A number of reports,[11] including the 2016 PC Report, have recommended the introduction of an objects clause into the Patents Act, which the Australian Government has accepted.[12] These reports found that the patent system lacked a clear objective or overarching framework to guide decision makers and the community.

10.              The introduction of an objects clause will clarify the underlying purpose of the patent system and over time will reduce uncertainty in the operation of the Patents Act. It will also provide broad guiding principles that will help ensure that the patent system remains adaptable and fit-for-purpose as new innovations are developed in the future.

Patents Act 1990

Item 1: After section 2

[s 2A]

11.              This item inserts new section 2A to introduce an objects clause into the Patents Act. The text of the objects clause is as follows and the language used is explained below:

12.              ‘The object of this Act is to provide a patent system in Australia that promotes economic wellbeing through technological innovation and the transfer and dissemination of technology. In so doing, the patent system balances over time the interests of producers, owners and users of technology and the public.’

13.              The purpose of the objects clause is to articulate the underlying purpose of the patents system in Australia. The clause provides that the benefits of the patents system to society are primarily economic in nature, and these benefits are achieved through incentivising innovation and the dissemination of technology. Among other things, this results in better access to technology and new inventions, which will lead to improved economic wellbeing.

14.              These objects are not new, but reflect existing goals of the patent system. The clause is intended to clarify and clearly articulate these goals, and to assist courts in interpreting the Patents Act in cases where the text of the legislation is uncertain or ambiguous. Given this, the objects clause does not alter the ordinary meaning of the legislation or overturn existing case law and established precedent.

15.              Further, the objects will not have any effect on the existing requirements for the grant of a patent. The elements to be considered when assessing an application for a patent are clearly set out in the Patents Act and existing case law, and the objects clause is not intended to alter this. For example, patentable subject matter will continue to be assessed in accordance with section 18 of the Patents Act.

Economic wellbeing

16.              The term ‘economic wellbeing’ is intended to indicate that the benefits of the patents system are primarily economic in nature. This limits the application of the objects clause to only economic factors and excludes ethical and social considerations. It has been suggested,[13] and not specifically addressed or rebutted in other reports,[14] that the objects clause should impute ethical and social considerations into the patents system. However, ethical matters are difficult to consider objectively and including subjective considerations may lead to unintended adverse outcomes, particularly where the moral standard in which to judge an ethical matter is not defined or changes over time.

17.              Moreover, the inclusion of social considerations risks introducing an expectation that each single patent application will be examined on it its social merit as well as current requirements. This is not the intention of the objects clause. The objects clause is a broad guiding statement about the benefits of the patent system as a whole rather than an indication that that the grant of any specific patent should achieve these objects. The social benefit of the patents system is achieved through its overall effect of incentivising innovation and promoting dissemination and transfer of technology.

18.              As such, and to use patentable subject matter as an example, the current legislated exclusions (such as subsection 18(2) of the Patents Act), safeguard provisions (such as Crown use and acquisition), case law and specific Acts are better placed to address questions of morality.

Technological innovation

19.              The term ‘technological innovation’ in the objects clause is not intended to narrow or change the subject matter eligibility threshold for grant of a patent. The test for patentable subject matter in Australia is whether or not the invention is a ‘manner of manufacture’ under paragraph 18(1)(a) of the Patents Act.

20.              The term ‘technological innovation’ is intended to be interpreted broadly to mean the applications of scientific knowledge for practical purposes. This is consistent with the current patentable subject matter threshold under the Patents Act, interpreted in the light of case law handed down by the courts.

21.              The use of the term ‘technological’ or ‘technical’ is used internationally in the context of objects of IP systems. For example, the Agreement on Trade-Related Aspects of Intellectual Property refers to ‘technological innovation’[15] and that patents ‘shall be available…in all fields of technology’[16].


 

Part 2 – Innovation patents

Introduction

22.              This Part contains amendments to the Patents Act to commence the abolition of the innovation patent system by preventing the filing of new applications, subject to certain limited exceptions.

23.              The innovation patent system was established to provide Australian SMEs with a quicker and more affordable way to protect their innovations. However, the PC found that the majority of SMEs who used the system did not obtain much value from it and that the system imposes unreasonable costs on third parties. Both the PC and the former ACIP have recommended that the innovation patent system be abolished. The Government agreed with these assessments.

24.              Abolishing the innovation patent system is not intended to affect existing rights. The system will continue to operate for innovation patents that were filed before these amendments commence. In addition, existing rights to file divisional applications and convert a standard patent application to an innovation patent application will be maintained for any patent or application that was filed prior to the commencement date of these amendments. This is achieved under the legislation by requiring that any innovation patent filed after the commencement date must have a date of patent and a priority date for each claim that is before the commencement date.

Patents Act 1990

Items 2, 3 and 9: Definition of ‘priority date’

[ss 3, 43, Schedule 1]

25.              These amendments add the term ‘priority date’ to the dictionary in the Patents Act. They do not make any changes to the interpretation or function of the term ‘priority date’. They are intended only to improve the readability of the legislation.

26.              Item 2 adds ‘priority date’ to the list of words in section 3 to indicate that a definition of this expression is provided in Schedule 1 to the Patents Act.

27.              Item 3 adjusts the formatting of the words ‘priority date’ in subsection 43(2) to indicate that a definition is provided in Schedule 1 to the Patents Act.

28.              Item 9 adds the definition of ‘priority date’ to Schedule 1. The priority date is determined in two ways, according to subsection 43(2) of the Patents Act. If subsection 43(2A) applies to the claim, the priority date is the date determined under the Patents Regulations. If subsection 43(2A) does not apply to the claim, the priority date is the date the specification was filed.

Item 4: Section 52

[s 52]

29.              This item inserts a new requirement into the formalities check for innovation patent applications. Under this new requirement, the date of the patent for an innovation patent application (if granted) must be earlier than the commencement date of this item. If the date of the patent would be on or after the commencement of this item, the innovation patent will not be granted.

30.              Note 1 added by this item helps the reader identify the commencement date of this item by directing them to the amending legislation.

31.              Note 2 added by this item directs the reader to section 65 of the Patents Act, which provides for the determination of the date of the patent.

32.              Note 3 added by this item directs the reader to the other requirements of the formalities check, which are provided for in regulations made under paragraph 228(2)(ha) of the Patents Act.

Items 5 and 6: Section 101B

[s 101B]

33.              Item 5 inserts a new requirement into the examination criteria for innovation patents. New paragraph 101B(2)(ha) requires the Commissioner to examine and report on whether each claim in the complete specification for an innovation patent has a priority date that is before the commencement date of this item.

34.              The note added by item 6 helps the reader identify the commencement date of this item by directing them to the amending legislation.

Items 7 and 8: Section 101E

[s 101E]

35.              Item 7 inserts a new requirement into the criteria that must be met before an innovation patent can be certified. Section 101E requires that the Commissioner must be satisfied, on the balance of probabilities, of a number of matters before issuing a certificate of examination to the patent owner. New subparagraph 101E(1)(a)(viiia) includes the requirement that the priority date of each claim in the specification must be earlier than the commencement date of this amendment.

36.              The note added by item 8 helps the reader identify the commencement date of these amendments by directing them to the amending legislation.

 

 

 

 


 

Schedule 2 - Crown use of patents

Part 1 - Amendments

Introduction

37.              This schedule amends the Patents Act to improve and clarify the operation of the Crown use provisions in Chapter 17 of that Act.

38.              Crown use permits governments to exploit a patented invention without authorisation by the patentee, where exploitation of the invention is necessary for the proper provision of services of the Commonwealth or a State. Crown use provisions provide a rarely-used safeguard where the patent system may otherwise hinder government in taking necessary action to deal with urgent or major issues of concern to the public.

39.              The Crown use provisions in the Patents Act allow the Commonwealth or a State or Territory, or a person authorised by the Commonwealth or a State or Territory, to use an invention without infringing a patent (or the rights that a nominated person would have if a patent is later granted on an application for a patent). However, where the provisions are invoked, the patent owner is entitled to remuneration for such use. This ensures that the rights of patent owners are taken into account, as well as the needs of the Australian public.

40.              The provisions were reviewed by the 2013 PC Report.[17] The PC was concerned that aspects of the process in using these provisions created uncertainty and that there was also a lack of transparency in the way in which they operated.

41.              The amendments made by this Schedule provide several modifications.

42.              To reduce uncertainty, the amendments will make it clear that Crown use can be invoked for the provision of a service that any Commonwealth, State or Territory Government has the primary responsibility for providing or funding. This will ensure that the full range of services the public expects the government to provide is covered by the legislation.

43.              At the moment, Crown use can be invoked without any prior notice to the patentee – although there is provision for subsequent discussion about remuneration. To improve transparency and accountability, the amendments will provide that governments are required to first seek a negotiated outcome (such as a licence to use the patent) with the patent owner. These requirements to first attempt to negotiate with the patent owner do not apply in an emergency.

44.              Should negotiation be unsuccessful, or if access to a patented invention is required in an emergency situation, the amendments will provide that Ministerial authorisation for invoking Crown use must be sought. Should it be approved, the patent owner must be notified of the reasons for the decision. The reasons must be given to the patent owner prior to exploitation under the Crown use provisions, or if an emergency, as soon as practicable.

Patents Act 1990

Items 1 to 4: Section 3 (list of definitions)

[s 3]

45.              Section 3 provides a list of expressions that are defined in the Patents Act. Item 1 inserts ‘exploited for Crown purposes’, item 2 inserts ‘relevant Minister’, and item 3 inserts ‘services’ into that list. Item 4 omits the term ‘State’ from the definition.

46.              These insertions are consequential to amendments made to the operation of the Crown use provisions in items 5, 7 and 26 (below).

Item 5: When an invention is exploited for Crown purposes

[s 160A]

47.              This item introduces new section 160A before section 161 of the Patents Act. New section 160A provides a definition for the term that an invention is ‘exploited for Crown purposes’. New section 160A also restructures and remakes some parts of existing section 163, and defines the term ‘services’.

48.              Currently, section 163 provides that Crown use applies where the invention is exploited for the services of the Commonwealth or a State. The main change introduced by new section 160A is to clarify that those services include services that the Commonwealth, State and/or Territory Governments have the primary responsibility for providing or funding. The intention is that this primary responsibility test would take account of all providers of similar services. This is discussed further below.

Exploitation for Crown purposes

49.              New subsection 160A(1) provides that an invention is exploited for Crown purposes if the invention is exploited by a relevant authority or by a person authorised by a relevant authority, if the exploitation is for the services of the Commonwealth or a State or Territory. The term ‘relevant authority’ is defined in the dictionary in Schedule 1 of the Patents Act and is amended by item 25 (below) to mean the Commonwealth or a State or a Territory or an authority thereof.

Authorisation to exploit for Crown purposes

50.              Currently, section 163 provides that non-government bodies may be authorised by the Commonwealth or a State to exploit an invention for the services of the Commonwealth or State. The authorisation must be in writing. New paragraph 160A(1)(b) and subsection 160A(2) will continue to allow governments to authorise non-government bodies to exploit an invention under the Crown use provisions, on the same terms as under current subsection 163(2).

For the services of a relevant authority

51.              New subsection 160A(3) remakes previous subsection 163(3) and updates the language used as a consequence of subsection 160A(1). It provides that, subject to section 168, an invention is taken to be exploited for the services of the relevant authority if the exploitation of the invention is necessary for the proper provision of those services within Australia.

52.              New subsection 160A(4) includes an important clarification of the meaning of “services of a relevant authority”. The amended definition makes it clear that Crown use can be invoked for the provision of a service that the Commonwealth, State and/or Territory Governments have the primary responsibility for providing or funding.

53.              Previous reviews of the Crown use provisions have identified uncertainty about the extent to which the infringement exemption arising under Crown use would extend to third-party
non-government entities providing public services.
[18] The amendments made by this item addresses this uncertainty by making clear that the term ‘services’ in relation to the Commonwealth, a State or a Territory includes services primarily provided or funded by government. The intention is that this primary responsibility test will take account of all providers of similar services to those provided or funded by a government, including non-government providers.

54.              For example, in a scenario where the patented invention concerns diagnostic genetic testing, genetic testing undertaken by private providers for private patients would be included in an assessment of whether governments have primary responsibly for providing or funding such testing. As governments are responsible for providing or funding the vast majority of genetic tests in the health care sector, they would have primary responsibility. As a result, genetic testing would be eligible for Crown use, including when it is undertaken by private providers for private patients, provided that when authorised by the Crown, private providers do not make a profit from their use of the invention. In this scenario, private providers could be authorised to exercise Crown use on behalf of a government, as is presently allowed under existing subsection 163(1) of the Patents Act.

55.              Including a test based on primary responsibility for providing or funding the service is not intended to limit the scope of “for the services of the Commonwealth or a State” (or “for the services of a relevant authority” as represented in new subsection 160A(4)), or to remove the existing right of individual government bodies to exploit an invention under Crown use, regardless of their share of the relevant market.

Item 6: Section 162

[s 162]

56.              This item repeals section 162 as a consequence of amendments made by item 25 (below).

Item 7: Crown exploitation of inventions

[ss 163 & 163A]

57.              This item repeals section 163 as a result of the restructuring of the provisions and introduces new sections 163 and 163A. These two new sections implement additional requirements that must be satisfied in order for the exploitation of an invention by the relevant authority to be exempt from infringement of a patent or of rights in a patent application for the invention.

58.              Section 163 provides the general rule for non-emergency situations. These amendments ensure that prior to exploitation of an invention by a relevant authority, governments are required to attempt to negotiate with the patent owner for an authorisation to exploit the invention. Should the negotiation attempt be unsuccessful, the relevant authority will need to seek approval from the relevant Minister (the Minister responsible for administering the Patents Act or the State or Territory Attorney-General) to rely on the Crown use provisions. If that approval is given, written approval and a statement of reasons for the approval must be provided to the patent owner.

59.              New section 163A provides an exemption to deal with emergency situations. In emergency situations, several of the requirements in section 163 do not apply.

60.              New subsection 163(1) provides that Crown exploitation of an invention is not an infringement of a patent, or the nominated person’s rights in the invention (if subject to a patent application), if several conditions are met. These conditions are set out in new subsection 163(3).

Terms to be complied with for Crown exploitation

61.              New subsection 163(2) provides that if terms relating to the exploitation of the invention have been agreed or determined in accordance with section 165, the exploitation is an infringement unless the terms are complied with. This item makes it clear that the scope of the exploitation of the invention is limited to the terms agreed by the parties or determined by the court.

62.              Terms may be agreed or determined at any point in time, including after the exploitation has commenced. A specific provision stating that terms do not need to be agreed before exploitation starts is not necessary, because new subsection 163(2) will only operate if the terms have been agreed or determined. New subsection 165(3) makes it clear that terms can be agreed or determined at any time (discussed below in relation to item 13).

Prior negotiation

63.              This item amends the Patents Act to introduce new paragraph 163(3)(a) which requires a relevant authority to first attempt for a reasonable period to negotiate with the patent owner for authorisation to exploit the invention on reasonable terms.

64.              The current provisions do not require the Crown to obtain consent from, or inform, the patent owner of its intention to exploit a patented invention before exploitation has commenced. Currently, the Crown can voluntarily seek consent before, during or after it has exploited a patent.

65.              Instituting a requirement to seek prior consent in Crown use should help achieve better outcomes for all parties. The requirement could result in a superior outcome for government because the agreement could, for example, incorporate other know-how of the patent owner. This would further ensure more efficient exploitation of the patented invention in addressing the situation at hand and provide greater transparency on the intentions of the Crown to exploit the invention.

66.              New paragraph 163(3)(a) further provides that the relevant Minister must consider whether the relevant authority has attempted to negotiate with the applicant and the nominated person, or the patentee for an authorisation to exploit the invention. The introduction of a requirement for prior negotiation does not apply where the situation requiring the exploitation of the patented invention is for an emergency situation under section 163A (discussed below).

Ministerial oversight

67.              This item also amends the Patents Act to insert new paragraph 163(3)(b) which introduces the condition that Ministerial approval must be obtained before a relevant authority can rely on the infringement exemption provided by the Crown use provisions.

68.              Previous reviews have contended that there was a lack of clarity about which entities constituted the Crown.[19] A number of entities could potentially qualify as the Crown, including: employees; commissions; statutory authorities; statutory corporations; government business entities; government owned corporations; and private corporations under contract to the government. Similar concerns of ambiguity relate to whether some research institutes have sufficient government involvement to be considered the Crown.[20]This lack of clarity about which entities constituted the Crown may also lead to a lack of certainty as to who may authorise exploitation by non-government entities under the Crown use provisions.

69.              The requirement in new paragraph 163(3)(b) for Ministerial approval will provide greater certainty for government or semi-government entities and for patent owners that the Crown use provisions apply to the exploitation of an invention. This will ultimately lead to a more effective application of Crown use. Ministerial consideration will ensure that Crown use is only invoked where the benefits outweigh the costs, will improve the clarity and certainty surrounding prior use, and give greater certainty to patent owners that the Crown use provisions will not be used inappropriately.

Requirements for Crown use to be authorised

70.              New paragraph 163(3)(c) provides the condition that the invention must be exploited for Crown purposes for the Minister to authorise Crown use of the invention. The circumstances in which an invention is exploited for Crown purposes are set out in new section 160A, discussed at item 5.

71.              New paragraph 163(3)(d) provides that a person must be authorised to exploit an invention under the Crown use provisions before any act covered by that authorisation is done. Currently a person could be authorised before or after the act has been done.

Notification of Crown use

72.              New paragraph 163(3)(e) provides that where a Minister has approved an instance of Crown use, the relevant authority is required to provide the applicant and the nominated person, or the patentee at least 14 days before the commencement of exploitation:

(i)                 a copy of the Minister’s approval to the Crown exploitation of the invention under new paragraph 163(3)(b); and

(ii)               a written statement of reasons as to why the approval was given.

73.              Providing the statement of reasons to the applicant and the nominated person, or the patentee, prior to the commencement of Crown exploitation will provide greater transparency to the patent owner about the decision to invoke Crown use.

74.              New subsection 163(4) provides that the instrument of approval made by the relevant Minister under paragraph 163(3)(b) is not a legislative instrument under paragraph 8(6)(a) of the Legislation Act 2003. This subsection is intended as a declaratory statement of the law rather than representing a departure from the requirements of the Legislation Act. The instrument of approval has the effect of approving a particular person to take a particular action or act in a particular way. As such, the approvals are administrative in character; they facilitate the carrying out of particular powers and functions. This is aligned with item 4 of regulation 6 of the Legislation (Exemptions and Other Matters) Regulation 2015 which provides that an instrument that has the effect of authorising or approving a particular person to take a particular action is not legislative in character.

Definition of relevant minister

75.              New subsection 163(5) introduces a new definition into the Act. The subsection defines “relevant Minister” which is referred to in section 163 and in several following sections. In the case of exploitation by or on behalf of the Commonwealth, the relevant Minister is the Minister responsible for the administration of the Patents Act, as provided for in Section 19 of the Acts Interpretation Act 1901. In the case of exploitation by or on behalf of a State or Territory, the relevant Minister is the appropriate State or Territory Attorney-General.

Emergency situation

76.              The amendments made by this item also introduce section 163A which provides for a modified approval process where the exploitation of the invention by the relevant authority is required due to an emergency.

Terms to be complied with for Crown exploitation

77.              New subsection 163A(2) provides that if terms relating to the exploitation of the invention have been agreed or determined in accordance with section 165, the exploitation is an infringement unless the terms are complied with. This item makes it clear that the scope of the exploitation of the invention is limited to the terms agreed by the parties or determined by the court. As with exploitation in the non-emergency situation above, the terms can be agreed or determined at any time.

Conditions for Crown exploitation in an emergency

78.              New subsection 163A(3) provides the preconditions for relying on the Crown use safeguard. These are that the Minister considers that the exploitation is necessary because of an emergency, and that the Minister approves the proposed exploitation before the exploitation starts. It also states that the invention must be exploited for Crown purposes and that a person must be authorised to exploit an invention under the Crown use provisions before any act covered by that authorisation is done. During a period of emergency, and in contrast to the non-emergency approval process of new section 163, the requirement for prior negotiation and the requirement to provide the statement of reasons prior to Crown exploitation do not apply.

79.              An emergency would include an unforeseen occurrence or a sudden and urgent occasion for action[21]. It could include a public health crisis such as a plague or epidemic, or a medical emergency such as a pandemic. It could also include war, national security situations, perceived threats to law and order, natural disasters and other situations of urgency. It includes, but is not limited to, situations where a state of emergency has been declared by a government. The amendments do not specify any considerations as to what constitutes an emergency, as the nature of emergency situations is inherently unpredictable, and in such situations it is important that a government can act quickly and that all possible situations are covered by the legislation.

80.              It is expected that this would be a rarely exercised power, particularly given that there have only been two reported cases in which Crown use has been contested in court.[22] Given this and the urgency inherent in the situation, a decision to authorise Crown use in an emergency is not subject to merits review.

81.              However, this power is not without constraint. Although the requirements to negotiate and to provide the statement of reasons prior to exploitation do not apply in emergencies, new subsection 163A(4) requires that in all cases the relevant Minister must as soon as practicable provide the patentee with a statement of reasons for approving the Crown exploitation.

82.              The patentee is also able to challenge the Minister’s decision through the judicial review processes under the Administrative Decisions (Judicial Review) Act 1977 (Cth). The patentee is as also able to apply for a court order under amended section 165A of the Patents Act to declare that the exploitation is no longer necessary for the proper provision of services of the relevant authority concerned. If the court makes such an order under section 165A, it can further order that the government cease exploiting the invention. This ensures that the rights of patentees are not unduly compromised, and provides appropriate safeguards on the use of this power.

83.              New subsection 163A(5) provides that the instrument of approval made by the relevant Minister under paragraph 163A(3)(b) is not a legislative instrument under paragraph 8(6)(a) of the Legislation Act 2003. This subsection is intended as a declaratory statement of the law rather than representing a departure from the requirements of the Legislation Act. The instrument of approval has the effect of approving a particular person to take a particular action or act in a particular way. As such, the approvals are administrative in character; they facilitate the carrying out of particular powers and functions. This is aligned with item 4 of regulation 6 of the Legislation (Exemptions and Other Matters) Regulation 2015 which provides that an instrument that has the effect of authorising or approving a particular person to take a particular action is not legislative in character.

Items 8 and 9: Section 164

[s 164]

84.              Item 8 revises the heading for section 164 to more appropriately reflect the role this section provides in requiring the relevant authority to notify the applicant and nominated persons, or patentee of approval and proposed exploitation under Crown use.

85.              Item 9 amends section 164 to omit the words “under subsection 163(1)” and replace them with “in the circumstances mentioned in subsection 163(3) or 163A(3).” This amendment is consequential upon item 7 which inserts new subsections 163(3) and 163A(3).

Items 10 and 11: Crown exploitation of inventions—terms (including remuneration)

[s 165]

86.              Item 10 revises the heading for section 165 to reflect more appropriately the role this section provides in determining the terms for Crown use.

87.              Item 11 repeals the previous subsection 165(2) and inserts a new subsection 165(2) which modifies how remuneration for exploitation of an invention is to be determined.

88.              Currently, section 165 gives no guidance how remuneration is to be determined.[23] Existing subsection 165(2) provides that, when parties fail to come to an agreement, either party can apply to a prescribed court for a determination on any terms of the exploitation, including remuneration. In the 2013 PC Report, the PC referred to previous reviews of the Crown use provisions[24], where it was contended that the lack of guidance on pricing can leave patentees disadvantaged, and that the lack of an applied standard or criterion to refer to in negotiations could weaken their bargaining position in seeking to obtain fair and equitable agreement. This was particularly the case for small and medium enterprises, which did not have the negotiating power or skills of large businesses.[25]

89.              Item 11 addresses these concerns by reforming the manner in which remuneration is determined under Crown use.

90.              New subsection 165(1) will remake existing subsection 165(2), with some editorial changes to improve readability.

91.              New subsection 165(2) provides that in determining the amount of remuneration, the prescribed court must determine an amount of remuneration that is just and reasonable and must take into account the economic value of the exploitation of the invention and any other matter the court considers relevant. This remuneration standard is a combination of the standard recommended by the PC[26] and that of the former ACIP.[27] It strikes an appropriate balance between ensuring compliance with international requirements as well as being sufficiently wide to take account of other considerations apparent in the circumstances of each case.

92.              The new standard for remuneration allows consistency with existing subsection 165(4), which will be unchanged. It should also be noted that remuneration is only one of the terms of the Crown exploitation. A reduced remuneration may be negotiated or ordered because of other more advantageous terms.

Item 12: Subsection 165(3)

[s 165]

93.              This item is consequential upon item 11, which amends section 165. This item amends the reference to ‘subsection (2)’ of section 165 to instead refer to ‘this section’.

Item 13: Subsection 165(3)

94.              This item inserts the phrase “or determined” into subsection 165(3). The effect is that, for the purpose this section, the terms, method, or determination by the court may be agreed, before, during, or after the exploitation.

Item 14: Subsection 165A (heading)

[s 165A]

95.              This item revises the heading for section 165A to more appropriately reflect the role this section provides.

Items 15 to 18: Subsections 165A(1) and 165A(2)

[s 165A]

96.              Item 15 removes a reference to “by the Commonwealth or State” and substitutes “in the circumstances mentioned in subsection 163(3) or 163A(3)”. This amendment is consequential upon item 7, which replaces the existing section 163 and introduces new section 163A.

97.              Items 16 to 18 are consequential upon item 5, and replace references to “the Commonwealth or the State” with references to the “relevant authority” in relation to the exploitation of the invention for Crown purposes.

Item 19: Section 166

[s 166]

98.              Item 19 repeals existing section 166 and substitutes new section 166. New section 166 has an amended heading to more appropriately reflect the role this section provides. This item also updates references to other provisions, simplifies the language used, and breaks down the clause into two subsections for readability.

99.              The new subsection 166(1) provides that an agreement or licence setting the terms on which a person other than a relevant authority may exploit an invention is inoperative with respect to the exploitation of the invention in the circumstances described in new subsections 163(3) and 163A(3). These requirements currently exist, however, these amendments simplify the language to increase readability and ensure consistency with the new provisions.

100.          The new subsection 166(2) provides that subsection (1) does not apply if the agreement or licence has been approved in writing by the relevant Minister, retaining the exception which currently exists.

Item 20: Subsections 167(1) and (2)

[s 167]

101.          Item 20 amends a reference to “under subsection 163(1)” and replaces it with “under subsection 163(1) or 163A(1)”. This amendment is consequential upon item 7, which inserts new subsections 163(1) and 163A(1).

Item 21: Section 169

[s 169]

102.          This item repeals section 169 of the Patents Act. Section 169 allows a patent owner who considers that the patented invention has been exploited by a government for the services of the Commonwealth or a State to apply to a prescribed court for a declaration to that effect. If a court made such a declaration, the requirements for terms for the exploitation (including remuneration) in current section 165 would be enlivened. Existing section 169 also allows the alleged relevant government authority to make a counter-claim that the patent is invalid and should be revoked.

103.          Under the new arrangement set out in new sections 163 and 163A, this section is no longer needed. The infringement exemption for government use of a patented invention will be conditional on the relevant Minister approving the use as Crown exploitation and notifying the patentee. As such, Crown exploitation cannot take place without the patent owner being made aware of it.

104.          If a patentee has concerns about government use of its invention, remedies remain available. Where the Minister has given this approval, a patent owner can apply to a prescribed court to determine the terms for the Crown exploitation under section 165 of the Patents Act, or order the Crown exploitation to cease under section 165A of the Patents Act. If the Minister has not given prior approval, the patent owner can take action under the infringement provisions in Chapter 11 of the Patents Act.

Items 22 and 23: Section 170

[s 170]

105.          These items amend section 170 to include a reference to ‘Territory’ as well ‘State’. These amendments are consequential on item 27 (below) which repeals the definition of ‘State’ allowing it to take its ordinary meaning.

Item 24: Schedule 1 (definition of exploited for Crown purposes)

[Schedule 1]

106.          This item amends Schedule 1 of the Patents Act to insert the definition for ‘exploited for Crown purposes’ (which has the meaning given by new subsection 160A(1)).

Item 25: Schedule 1 (definition of relevant authority)

[Schedule 1]

107.          This item repeals the definition of ‘relevant authority’ and replaces it with a new definition which incorporates provisions repealed by items 6 and 27.

108.          This item incorporates repealed section 162 (item 6 above). Current section 162 states that a reference to the Commonwealth includes a reference to a Commonwealth authority, and reference to a State includes a reference to a State authority. In the new Crown use provisions, references to the ‘Commonwealth’ and the ‘State’ (where needed) have been replaced with the term ‘relevant authority’ to reflect the new terminology introduced by item 5 (above). As a result, section 162 was repealed and incorporated into the definition of ‘relevant authority’ for ease of readability.

109.          This item also incorporates changes consequential to the repealed definition of ‘State’ at Schedule 1 (item 27 below). As a result, a separate reference to ‘Territory’ is required and has been incorporated into this item. It provides that the definition of ‘relevant authority’ also includes a Territory or an authority of a Territory.

Item 26: Schedule 1 (definition of relevant Minister and services)

[Schedule 1]

110.          This item amends Schedule 1 of the Patents Act to insert definitions for ‘relevant Minister’ (which has the meaning given by new subsection 163(5)) and ‘services’ (which has the meaning affected by new subsection 160A(4)) to account for the amendments made to the operation of the Crown use provisions in items 5 and 7 (above).

Item 27: Schedule 1 (definition of State)

111.          This item repeals the definition of ‘State’ from Schedule 1.

112.          Currently, Schedule 1 defines ‘State’ for the purposes of Chapter 17 only so that the expression includes the Australian Capital Territory, the Northern Territory and Norfolk Island. As a result of the specific inclusion of ‘Territory’ in the definition of ‘relevant authority’ (item 25 above) and in sections where reference to the Commonwealth and State have been retained (for example items 22 and 23), the expanded definition of ‘State’ is not required and so has been repealed.


 

Part 2 - Application and transitional provisions

Item 28: Definition

113.          This item introduces the term ‘amended Act’ for use in Part 2 of Schedule 1 for the application and transitional provisions (items 29 to 32 below).

Item 29: Application of amendments

114.          The principles underpinning the application provisions are that the changes should:

·         take effect as soon as possible, to quickly improve the operation and transparency of the Crown use provisions; and

·         not unduly prejudice users of the system, particularly with respect to not affecting any existing or in-force terms for Crown use of an invention, whether these are agreed between the parties or determined by a court.

115.          Subitem (1) of item 29 applies to amendments made by Part 1 of Schedule 2, excluding section 166. The amendments made by Part 1 of Schedule 2 relate to the restructuring and modification of the requirements that must be met prior to an act of exploitation being considered authorised under Crown use. These changes are to apply in relation to Crown exploitation which starts, or is proposed to start, on or after the commencement of Schedule 2.

116.          Subitem (2) of item 29 applies to the amendment made to section 166. This application provision ensures that section 166 can apply to agreements made or licences given before, on or after the day this Schedule commences provided the exploitation of inventions occurs on or after the day this Schedule commences. This avoids the situation where, for example, an exclusive licencing arrangement made with another party prior to the amendments could prevent Crown exploitation from taking place after the commencement of Schedule 2.

Item 30: Transitional—authorised person

117.          This item relates to authorisation of a person by a relevant authority to exploit an invention under Crown use. Previously a person could be authorised before or after the act had been done. The amendments at items 5 and 7 operate so that a person needs to be authorised, in writing, prior to exploiting an invention for Crown purposes.

118.          The transitional provision is consequential upon the changes that insert section 160A and repeal existing section 163 and remake it as new section 163. The provision ensures that an authorisation of a person under existing section 163 has the same force as it had before the changes were made, and as an authorisation provided under the amended provisions will have.

Item 31: Transitional—negotiations

119.          This item relates to the new pre-condition introduced at item 7 that prior to Crown exploitation under new subsection 163(3), the relevant authority is required to attempt to negotiate for a reasonable period and under reasonable terms with the patent owner for authorisation to exploit the invention. If negotiation is unsuccessful, the relevant authority is to seek approval from the relevant Minister to invoke Crown use under new paragraph 163(3)(b).

120.          The requirement for prior negotiation in paragraph 163(3)(a) is a new pre-condition that did not exist under the previous Crown use provisions. Nevertheless, a government agency may have entered into negotiations to gain the patent owner’s permission to use a patented invention.

121.          The transitional provision ensures that, if a relevant authority has engaged in negotiation with the patent owner for authorisation to exploit an invention prior to commencement of this Schedule, the relevant authority is not required to repeat the negotiation process upon commencement of this Schedule.

Item 32: Transitional—agreements and determinations

122.          This item relates to an agreement or determination of the terms for exploitation of the invention between the relevant authority and the patent owner for the purposes of exploitation of an invention under Crown use.

123.          The transitional provision relates to the amendments made by item 11 above. The provision ensures that an agreement or determination under existing subsection 165(2) has the same force as it had before the changes were made, and as an agreement or determination made under new subsections 165(1) and 165(2) will have.


 

Schedule 3 - Crown use of designs

Part 1 - Amendments

Introduction

124.          This schedule amends the Designs Act to improve and clarify the operation of the Crown use provisions in Chapter 8 of that Act.

125.          The amendments made by this Schedule provide several modifications and are consistent with those made under Schedule 2 to the Crown use provisions in the Patents Act. 

Designs Act 2003

Item 1: Section 5 (definitions)

[s 5]

126.          This item amends section 5 of the Designs Act to insert a definition for ‘relevant authority’. The definition is consistent with the definition in the Patents Act as amended by Schedule 2 item 25 above. The definition provides that a relevant authority is, in relation to the use of a design by or for the Commonwealth, the State or a Territory, the Commonwealth, that State, or that Territory respectively.

127.          This item also provides definitions for ‘relevant Minister’ (which has the meaning given by new subsection 96(5)), ‘services’ (which has the meaning affected by new subsection 95(5)), and ‘used for Crown purposes (which has the meaning given by new subsection 95(2)) to account for the amendments made to the operation of the Crown use provisions in items 2 and 3 below.

Item 2: When a design is used for Crown purposes

[s 95]

128.          This item repeals subsection 95(2) and introduces new subsections 95(2), (3), (4) and (5) to the Designs Act. New subsections 95(2) and (3) provide a definition for the term “used for Crown purposes”. New section 95(2) also restructures and remakes some parts of existing section 96, and defines the term “services”.

129.          Currently, section 96 provides that Crown use applies where the design is used for the services of the Commonwealth or a State. The main change introduced by new section 95 is to clarify that those services include services that the Commonwealth, State and/or Territory Governments have the primary responsibility for providing or funding. The intention is that this primary responsibility test would take account of all providers of similar services. This is discussed further below.

Use for Crown purposes

130.          New subsection 95(2) provides that a design is used for Crown purposes if the design is used by a relevant authority or by a person authorised by a relevant authority, if the use is for the services of the Commonwealth or a State or Territory. The term ‘relevant authority’ is defined in the dictionary in section 5 of the Designs Act and is amended by item 1 (above) to mean the Commonwealth or a State or a Territory or an authority thereof.

Authorisation to use for Crown purposes

131.          Currently, section 96 provides that non-government bodies may be authorised by the Commonwealth or a State to use a design for the services of the Commonwealth or State. The authorisation must be in writing. New paragraph 95(2)(b) and subsection 95(3) will continue to allow governments to authorise non-government bodies to use a design under the Crown use provisions, on the same terms as under current subsection 96(2).

For the services of a relevant authority

132.          New subsection 95(4) remakes previous subsection 96(3) and updates the language used as a consequence of subsection 95(2). It provides that, subject to section 105, a design is taken to be used for the services of the relevant authority if the use of the design is necessary for the proper provision of those services within Australia.

133.          New subsection 95(5) includes an important clarification of the meaning of ‘services of a relevant authority’. The amended definition makes it clear that Crown use can be invoked for the provision of a service that the Commonwealth, State and/or Territory Governments have the primary responsibility for providing or funding.

134.          Previous reviews of the Crown use provisions in the Patents Act (and which are also applicable to the designs system) have identified uncertainty about the extent to which the infringement exemption arising under Crown use would extend to third-party non-government entities providing public services.[28] The amendments made by this item addresses this uncertainty by making clear that the term ‘services’ in relation to the Commonwealth, a State or a Territory includes services primarily provided or funded by government. The intention is that this primary responsibility test will take account of all providers of similar services to those provided or funded by a government, including non-government providers.

135.          Including a test based on primary responsibility for providing or funding the service is not intended to limit the scope of “for the services of the Commonwealth or a State” (or “for the services of a relevant authority” as represented in new subsection 95(5)), or to remove the existing right of individual government bodies to use a design under Crown use, regardless of their share of the relevant market.

Definition of State

136.          This item also repeals the definition of ‘State’ from subsection 95(2).

137.          Currently, subsection 95(2) defines ‘State’ for the purposes of Part 2 of Chapter 8 only and outlines that the definition includes the Australian Capital Territory, the Northern Territory and Norfolk Island. As a result of the specific inclusion of ‘Territory’ in the definition of ‘relevant authority’ (item 1 above) and in sections where reference to the Commonwealth and State have been retained (for example items 17, 18 and 19), the expanded definition of ‘State’ is not required and so has been repealed.

Item 3: Crown use of designs

[ss 96 & 96A]

138.          This item repeals section 96 as a result of the restructuring of the provisions and introduces new sections 96 and 96A. Currently, section 100 provides that infringement proceedings do not lie in relation to the use of a design under section 96. These two new sections incorporate current section 100 and implement additional requirements that must be satisfied in order for the use of the design by the relevant authority to be exempt from infringement of a registered design.

139.          Section 96 provides the general rule for non-emergency situations. These amendments ensure that prior to the use of a design by a relevant authority, governments are required to attempt to negotiate with the design owner for an authorisation to use the design. Should the negotiation attempt be unsuccessful, the relevant authority will need to seek approval from the relevant Minister (the Minister responsible for administering the Designs Act or the State or Territory Attorney-General) to rely on the Crown use provisions. If that approval is given, written approval and a statement of reasons for the approval must be provided to the design owner.

140.          New section 96A provides an exemption to deal with emergency situations. In emergency situations, several of the requirements in section 96 do not apply.

141.          New subsection 96(1) provides that Crown use of a design is not an infringement of a registered design, if several conditions are met. These conditions are set out in new subsection 96(3).

Terms to be complied with for Crown use

142.          New subsection 96(2) provides that, despite subsection (1), if terms relating to the use of the design have been agreed or determined in accordance with section 98, the use is an infringement unless the terms are complied with. This item makes it clear that the scope of the use of the design is limited to the terms agreed by the parties or determined by the Court.

143.          Terms may be agreed or determined at any point in time, including after the use has commenced. A specific provision stating that terms do not need to be agreed before use starts is not necessary, because new subsection 96(2) will only operate if the terms have been agreed. New subsection 98(5) makes it clear that terms can be agreed or determined at any time (discussed below in relation to item 7).

Prior negotiation

144.          This item amends the Designs Act to introduce new paragraph 96(3)(a) which requires a relevant authority to first attempt for a reasonable period to negotiate with the registered owner of the design for authorisation to use the design on reasonable terms.

145.          The current provisions do not require the Crown to obtain consent from, or inform, the design owner of its intention to use a design before use has commenced. Currently, the Crown can voluntarily seek consent before, during or after it has used a design.

146.          Instituting a requirement to seek prior consent in Crown use should help achieve better outcomes for all parties. The requirement could result in a superior outcome for government because the agreement could, for example, incorporate other know-how of the design owner. This would further ensure more efficient use of the design in addressing the situation at hand and provide greater transparency on the intentions of the Crown to use the design.

147.          New paragraph 96(3)(a) further provides that the relevant Minister must consider whether the relevant authority has attempted to negotiate with the applicant or entitled person, or the registered owner of the design for an authorisation to use the design. The introduction of a requirement for prior negotiation does not apply where the situation requiring the use of the design is for an emergency situation under section 96A (discussed below).

Ministerial oversight

148.          This item also amends the Designs Act to insert new paragraph 96(3)(b) which introduces the condition that Ministerial approval must be obtained before a relevant authority can rely on the infringement exemption provided by the Crown use provisions.

149.          Previous reviews have contended that there was a lack of clarity about which entities constituted the Crown[29] in the Patents Act (and these concerns are equally applicable to the Designs system). A number of entities could potentially qualify as the Crown, including: employees; commissions; statutory authorities; statutory corporations; government business entities; government owned corporations; and private corporations under contract to the government. Similar concerns of ambiguity relate to whether some research institutes have sufficient government involvement to be considered the Crown.[30] This lack of clarity about which entities constituted the Crown may also lead to a lack of certainty as to who may authorise use by non-government entities under the Crown use provisions. 

150.          The requirement in new paragraph 96(3)(b) for Ministerial approval will provide greater certainty for government or semi-government entities and for registered owners of designs that the Crown use provisions apply to the use of a design. This will ultimately lead to a more effective application of Crown use. Ministerial consideration will ensure that Crown use is only invoked where the benefits outweigh the costs, will improve the clarity and certainty surrounding prior use, and give greater certainty to design owners that the Crown use provisions will not be used inappropriately.

Requirements for Crown use to be authorised

151.          New paragraph 96(3)(c) provides the condition that the design must be used for Crown purposes for the Minister to authorise Crown use of the design. The circumstances in which a design is used for Crown purposes are described in new subsection 95(2), discussed above at item 2.

152.          New paragraph 96(3)(d) provides that a person must be authorised to use a design under the Crown use provisions before any act covered by that authorisation is done. Currently, a person could be authorised before or after the act has been done.

Notification of Crown use

153.          New paragraph 96(3)(e) provides that where a Minister has approved an instance of Crown use, the relevant authority is required to provide the applicant and the entitled person, or the registered owner at least 14 days before the use starts:

(i)                 a copy of the Minister’s approval to the Crown use of the design under new paragraph 96(3)(b); and

(ii)               a written statement of reasons as to why the approval was given.

154.          Providing the statement of reasons to the applicant and the entitled person, or the registered owner, prior to the commencement of Crown use will provide greater transparency to the owner of the registered design about the decision to invoke Crown use.

155.          New subsection 96(4) has been included to assist readers. The subsection provides that the instrument of approval made by the relevant Minister under paragraph 96(3)(b) is not a legislative instrument, as it is exempt under item 4 of regulation 6 of the Legislation (Exemptions and Other Matters) Regulation 2015. Subsection 96(4) is a declaratory statement of the law in the Legislation (Exemptions and Other Matters) Regulation 2015, rather than representing a departure from the requirements of the Legislation Act 2003.

Definition of ‘relevant Minister’

156.          New subsection 96(5) introduces a new definition into the Act. The subsection defines ‘relevant Minister’ which is referred to in section 96 and in several following sections. In the case of use by or on behalf of the Commonwealth, the relevant Minister is the Minister responsible for the administration of the Designs Act, as provided for in Section 19 of the Acts Interpretation Act 1901. In the case of use by or on behalf of a State or Territory, the relevant Minister is the appropriate State or Territory Attorney-General.

Emergency situation

157.          The amendments made by this item also introduce section 96A which provides for a modified approval process where the use of the design by the relevant authority is required due to an emergency.

158.          New subsection 96A(2) provides that, despite subsection (1), if terms relating to the use of the design have been agreed or determined in accordance with section 98, the use is an infringement unless the terms are complied with. This item makes it clear that the scope of the use of the design is limited to the terms agreed by the parties or determined by the Court.

159.          Terms may be agreed or determined at any point in time, including after the use has commenced. A specific provision stating that terms do not need to be agreed before use starts is not necessary, because new subsection 96A(2) will only operate if the terms have been agreed. New subsection 98(5) makes it clear that terms can be agreed or determined at any time (discussed below in relation to item 7).

160.          New subsection 96A(3) provides the preconditions for relying on the Crown use safeguard. These are that the Minister considers that the use is necessary because of an emergency, and that the Minister approves the proposed use before the use starts. It also states that the design must be used for Crown purposes and that a person must be authorised to use a design under the Crown use provisions before any act covered by that authorisation is done. During a period of emergency, and in contrast to the non-emergency approval process of new section 96, the requirement for prior negotiation and the requirement to provide the statement of reasons prior to Crown use do not apply.

161.          An emergency would include an unforeseen occurrence or a sudden and urgent occasion for action[31]. It could include a public health crisis such as a plague or epidemic, or a medical emergency such as a pandemic. It could also include war, national security situations, perceived threats to law and order, natural disasters and other situations of urgency. It includes but is not limited to situations where a state of emergency has been declared by a government. The amendments do not specify any considerations as to what constitutes an emergency, as the nature of emergency situations is inherently unpredictable, and in such situations it is important that a government can act quickly and that all possible situations are covered by the legislation.

162.          It is expected that this would be a rarely exercised power, particularly given that there are no reported cases of Crown use of designs being contested in court. Given this and the urgency inherent in the situation, this decision to authorise Crown use is not merits reviewable.

163.          However, this power is not without constraint. Although the requirements to negotiate and to provide the statement of reasons prior to use do not apply in emergencies, new subsection 96A(3) requires that in all cases the relevant Minister must as soon as practicable provide the design owner with a statement of reasons for approving the Crown use.

164.          The owner of the registered design is also able to challenge the Minister’s decision through the judicial review processes under the Administrative Decisions (Judicial Review) Act 1977 (Cth). The owner of the registered design is also able to apply for a court order under amended section 102 of the Designs Act to declare that the use is no longer necessary for the proper provision of services of the relevant authority concerned. If the court makes such an order under section 102, it can further order that the government cease using the design. This ensures that the rights of design owners are not unduly compromised, and provides appropriate safeguards on the use of this power.

165.          New subsection 96A(5) has been included to assist readers. The subsection provides that the instrument of approval made by the relevant Minister under paragraph 96A(3)(b) is not a legislative instrument, as it is exempt under item 4 of regulation 6 of the Legislation (Exemptions and Other Matters) Regulation 2015. Subsection 96A(5) is a declaratory statement of the law in the Legislation (Exemptions and Other Matters) Regulation 2015, rather than representing a departure from the requirements of the Legislation Act 2003.

Items 4, 5 and 6: Subsections 97(1) and (2)

[s 97]

166.          Item 4 amends subsection 97(1) consequential upon item 3 that inserts new sections 96(2) and 96A(2). 

167.          Items 5 and 6 are consequential upon item 2, which updates references in new section 95 to use ‘relevant authority’ when referring to use of the design under Crown use.

Item 7: Crown use of designs—terms (including remuneration)

[s 98]

168.          Item 7 repeals the current section 98 and inserts a new section 98 which modifies how remuneration for use of a design is to be determined. This item also revises the heading for section 98 to reflect more appropriately the role this section provides in determining the terms for Crown use.

169.          Currently, section 98 gives no guidance on how remuneration is to be determined[32]. Existing subsection 98(1) provides that, when parties fail to come to an agreement, either party can apply to a prescribed court for a determination on any terms of the use, including remuneration. The PC referred to previous reviews of the Crown exploitation provisions in the Patents Act[33], where it was contended that the lack of guidance on pricing can leave patentees disadvantaged, and that the lack of an applied standard or criterion to refer to in negotiations could weaken their bargaining position in seeking to obtain fair and equitable agreement. This was particularly the case for small and medium enterprises, which did not have the negotiating power or skills of large businesses.[34] These considerations of the Crown exploitation provisions in the Patents Act are equally applicable to the designs system.

170.          Item 7 addresses these concerns by reforming the manner in which remuneration is determined under Crown use.

171.          New subsection 98(1) will remake existing subsection 98(1), with some editorial changes to improve readability, and to include references to the new subsections 96(3) and 96A(3).

172.          New subsection 98(2) provides that in determining the amount of remuneration, the prescribed court must determine an amount of remuneration that is just and reasonable and must take into account the economic value of the use of the design and any other matter the court considers relevant. This remuneration standard is a combination of the standard recommended by the PC[35] and that of the former ACIP[36] in considering Crown use of patents. It strikes an appropriate balance between ensuring compliance with international requirements as well as being sufficiently wide to take account of other considerations apparent in the circumstances of each case.

173.          This new standard for remuneration allows consistency with existing subsection 98(2), which will be substantively unchanged but renumbered as subsection 98(4). It should also be noted that remuneration is only one of the terms of the Crown use. A reduced remuneration may be negotiated or ordered because of other more advantageous terms.

174.          Existing section 98(3) is retained and remains substantively unchanged.

175.          New subsection 98(4) remakes existing subsection 98(2), which remains substantively unchanged.

176.          This item inserts a new subsection 98(5) which provides that, for the purposes of this section, the terms, method, or determination by the court may be agreed, before, during, or after the use of the design. This is consistent with the amendment made to section 165(3) of the Patents Act by item 13 of Schedule 2.

Item 8: Section 99

[s 99]

177.          Item 8 repeals existing section 99 and substitutes new section 99. New section 99 has an amended heading to more appropriately reflect the role this section provides. This item updates references and simplifies the language used for readability.

178.          The new subsection 99(1) provides that an agreement or licence setting the terms on which a person other than a relevant authority may use an design is inoperative with respect to the use of the design in the circumstances described in new subsections 96(3) and 96A(3). These requirements currently exist, however, these amendments simplify the language to increase readability and ensure consistency with the new provisions.

179.          The new subsection 99(2) provides that subsection (1) does not apply if the agreement or licence has been approved in writing by the relevant Minister, retaining the exception which currently exists.

Item 9: Sections 100 and 101

[ss 100 & 101]

180.          Item 9 repeals sections 100 and 101.

181.          The repealing of section 100 is consequential upon new subsection 96(1) (item 3 above). Currently, section 100 provides that infringement proceedings do not lie in relation to the use of a design under section 96. New section 96(1) incorporates this provision and provides that use of a design in the circumstances mentioned in subsection 96(3) is not an infringement of a registered design.

182.          Current section 101 allows a registered owner of a design (where a certificate of examination has been issued) who considers that the design has been used by a government for the services of the Commonwealth or a State to apply to a prescribed court for a declaration to that effect. If a court made such a declaration, the requirements for terms for the use (including remuneration) in section 98 would be enlivened. Existing section 101 also allows the alleged relevant government authority to make a counter-claim that the design is invalid and should be revoked.

183.          Under the new arrangement set out in new sections 96 and 96A this section is no longer needed. The infringement exemption for government use of a design will be conditional on the relevant Minister approving the use as Crown use and notifying the owner of the registered design. As such, Crown use cannot take place without the design owner being made aware of it.

184.          If an owner of a registered design has concerns about government use of its design, remedies remain available. Where the Minister has given this approval, an owner of a registered design can apply to a prescribed court to determine the terms for the Crown use under section 98 of the Designs Act, or order the Crown use to cease, under section 102 of the Designs Act.

185.          If the Minister has not given prior approval, the design owner can take action under the infringement provisions in Chapter 6 of the Designs Act.

Item 10: Section 102 (heading)

[s 102]

186.          This item revises the heading for section 102 to more appropriately reflect the role this section provides.

Items 11 to 14: Subsections 102(1), 102(3) and 102(4)

[s 102]

187.          Item 11 removes a reference to “by the Commonwealth or State” and substitutes “in the circumstances mentioned in subsection 96(3) or 96A(3)”. This amendment is consequential upon item 3, which replaces the existing section 96 and introduces new section 96A.

188.          Items 12 to 14 are consequential upon item 2, and replace references to “the Commonwealth or the State” with references to the “relevant authority” in relation to the exploitation of the invention for Crown purposes.

Items 15 and 16: Section 103

[s 103]

189.          Item 15 amends section 103 to remove the words “under section 96” and replace them with “in the circumstances mentioned in section 96(3) or 96A(3)”. This item is consequential upon item 3, which inserts new sections 96 and 96A.

190.          Item 16 amends section 103 to replace a reference to “the Commonwealth or the State” with a reference to the “relevant authority”.

Items 17, 18 and 19: Section 104

[s 104]

191.          These items amend section 104 to include a reference to ‘Territory’ as well ‘State’. These amendments are consequential of item 2 (above) which repeals the definition of ‘State’.

Part 2 - Application and transitional provisions

Item 20: Definitions

192.          This item introduces the term ‘amended Act’ for use in Part 2 of Schedule 3 for the application and transitional provisions (items 21 to 24 below).

Item 21: Application of amendments

193.          The principles underpinning the application provisions are that the changes should:

·         take effect as soon as possible, to quickly improve the operation and transparency of the Crown use provisions; and

·         not unduly prejudice users of the system, particularly with respect to not affecting any existing or in-force agreements or licences negotiated by a relevant authority and an applicant or entitled person, or the registered owner.

194.          Subitem (1) of item 21 applies to amendments made by Part 1 of Schedule 3, excluding section 99. The amendments made by Part 1 of Schedule 3 relate to the restructure and modification of the requirements that must be met prior to an act of use being considered authorised under Crown use. These changes are to apply in relation to Crown use which starts, or is proposed to start, on or after the commencement of Schedule 3.

195.          Subitem (2) of item 21 applies to the amendment made to section 99. This application provision ensures that section 99 can apply to agreements made or licences given before, on or after the day this Schedule commences provided the use of the design occurs on or after the day this Schedule commences. This avoids the situation where, for example, an exclusive licensing arrangement made with another party prior to the amendments could prevent Crown use from taking place after commencement of Schedule 3.

Item 22: Transitional—authorised person

196.          This item relates to authorisation of a person by a relevant authority to use design under Crown use. Previously a person could be authorised before or after the act had been done. The amendments at items 2 and 3 operate so that a person needs to be authorised, in writing, prior to use of a design for Crown purposes.

197.          The transitional provision is consequential upon the changes that insert section 95 and repeal existing section 96 and remake it as new section 96. The provision ensures that an authorisation of a person under existing section 96 has the same force as it had before the changes were made, and as an authorisation provided under the amended provisions will have.

Item 23: Transitional—negotiations

198.          This item relates to the new pre-condition introduced at item 3 that prior to Crown use under new subsection 96(2), the relevant authority is required to attempt to negotiate for a reasonable period and under reasonable terms with the owner of the registered design for authorisation to use the design. If negotiation is unsuccessful, the relevant authority is to seek approval from the relevant Minister to invoke Crown use under new paragraph 96(3)(b).

199.          The requirement for prior negotiation in paragraph 96(3)(a) is a new pre-condition that did not exist under the previous Crown use provisions. Nevertheless, a government agency may have entered into negotiations to gain the owner of the registered design’s permission to use a design.

200.          The transitional provision ensures that, if a relevant authority has engaged in negotiation with the registered owner of the design for authorisation to use a design prior to commencement of this Schedule, the relevant authority is not required to repeat the negotiation process upon commencement of this Schedule.

Item 24: Transitional—agreements and determinations

201.          This item relates to an agreement or determination of the terms for use of the design between the relevant authority and the owner of the registered design for the purposes of use of a design under Crown use.

202.          The transitional provision is consequential upon the changes that repeal existing subsection 98(1) and remake it as new subsection 98(1). The provision ensures that an agreement or determination under existing subsection 98(1) has the same force as it had before the changes were made, and as an agreement or determination made under the amended provisions will have.


 

Schedule 4 - Compulsory licenses

Introduction

203.          This Schedule amends the Patents Act to replace the ‘reasonable requirements of the public’ test with a ‘public interest’ test when the Federal Court considers an application for a compulsory licence. This Schedule also introduces amendments that require the court to consider the public interest when specifying the terms of the licence, including remuneration.

204.          A compulsory licence is an order made by the Federal Court for a patentee to grant a licence to another party to exploit an invention. Compulsory licensing provides a mechanism to prevent the patentee from restricting others from exploiting the invention in the local market, where it has failed to do so itself.

205.          The 2013 PC Report found that there was potential to conflate the ‘reasonable requirements of the public’ with the interests of Australian industry, which is inconsistent with promoting community-wide welfare. As a result, the PC recommended that the ‘reasonable requirements of the public’ test be replaced with a ‘public interest’ test.

206.          This Schedule also amends the Patents Act to clarify the operation of the compulsory licensing provisions for dependent patents.

207.          As currently drafted, subsection 133(3B) of the Patents Act does not limit who can apply for a compulsory licence in order to exploit a ‘dependent patent’ – one which can only be exploited by also exploiting an earlier patent (the ‘original patent’) . This has the effect that a third party can apply for a compulsory licence in relation to a dependent patent, leading to inequitable and illogical outcomes:

·         Under subparagraph 133(3B)(b)(i) a third party applicant who has only satisfied the grounds for a compulsory licence over a dependent patent would also be able to automatically obtain a compulsory licence over the original patent, to the extent necessary to work the invention. This outcome is illogical and provides the applicant with an unfair advantage.

·         Under subparagraph 133(3B)(b)(ii) the owner of the dependent patent may be required to compensate the owner of the original patent by granting a cross-licence, even where the applicant for the compulsory licence is a third party. This outcome is not logical and disadvantages the patentee of the dependent patent, as it is the third party who is making use of the original patent, not the patentee of the dependent patent.

208.          These amendments rectify this problem by providing that only the patentee of a dependent patent can seek a compulsory licence over the use of the original patent.

Patents Act 1990

Item 1: Section 132B

[s 132B]

209.          This item removes the term “to work” from section 132B and replaces it with the term “to exploit”. This amendment ensures consistency between the compulsory licensing provisions and with the Patents Act generally.

Item 2: Section 132B

[s 132B]

210.          This item amends the simplified outline of Part 2 of Chapter 12 of the Patents Act set out in section 132B to replace a reference to the ‘reasonable requirements of the public’ test with a reference to the new requirements for a compulsory license in item 6, including the ‘public interest’ test. It also provides an overview of compulsory licences for dependent patents. This change is consequential to amendments made by item 6.

Item 3: Before subsection 133(1)

[s 133]

211.          This item inserts the subheading ‘Application for an order granting a compulsory licence’. This change has been made to assist in reading section 133.

Item 4: Subsection 133(1)

[s 133]

212.          This item removes the term “to work” from section 133(1) and replaces it with the term “to exploit”. This amendment ensures consistency between the compulsory licensing provisions and with the Patents Act generally.

Item 5: Subsection 133(1)

[s 133]

213.          This item inserts the term ‘(the original invention)’ after ‘patented invention’. This change is consequential to amendments made by item 6.

Item 6: Subsections 133(2), (3) and (3B)

[s133]

214.          This item repeals subsections 133(2), (3) and (3B) and introduces new subsections 133(2), (3), (3A), (3B) and (3C) to amend the requirements for the court to make an order for a compulsory licence and to amend the requirements for the form of the order.

Making an order

215.          Currently, subsection 133(2) provides that ‘the court may…make the order [requiring the patentee to grant a compulsory licence] if satisfied that:

(a)    all the following conditions exist:

                                               (i)      the applicant has tried for a reasonable period, but without success, to obtain from the patentee an authorisation to work on the invention on reasonable terms and conditions;

                                             (ii)      the reasonable requirements of the public with respect to the patented invention have not been satisfied;

                                           (iii)      the patentee has given no satisfactory reason for failing to exploit the patent; or

(b)   the patentee has contravened, or is contravening, Part IV of the Competition and Consumer Act 2010 or an application law (as defined in section 150A of that Act) in connection with the patent.’

216.          New subsection 133(2) still sets out the circumstances in which the court can make an order for a compulsory licence. In the new subsection 133(2), former paragraph 133(2)(a) has been replaced with new conditions but the current paragraph 133(2)(b) is retained.

217.          New subsection 133(3) lists the conditions which must be satisfied before the court can make an order for a compulsory licence under new paragraph 133(2)(a).

Demand for the invention

218.          New paragraphs 133(3)(a) and (b) require that for the grant of a compulsory licence, there must be unmet demand in Australia for an original patented invention and that authorisation to exploit this original patented invention is required to meet that demand.

219.          New paragraphs 133(3)(a) and (b) are to be considered as consistent with, but in addition to, the public interest test at paragraph 133(3)(e). The inclusion of these considerations will retain protection for trade and industry against market failure in respect of the invention currently set out under subsection 135(1), but will strike a better balance between the needs of industry and the broader public.

Attempt to gain authorisation

220.          New paragraph 133(3)(c) retains the condition in current subparagraph 133(2)(a)(i) that the applicant must have attempted, for a reasonable amount of time, but without success, to obtain authority from the patentee to use the invention. However, under the new paragraph 133(3)(c) the requirement has changed from obtaining authority to work the invention to obtaining authority to exploit the original invention. This has been amended for consistency with other parts of the Act, including Part 3 of Chapter 12.

Failure to exploit the patent

221.          New paragraph 133(3)(d) retains the condition in current subparagraph 133(2)(a)(iii) that the patentee has given no satisfactory reason for not exploiting the patent. The circumstances for which the patentee must provide an explanation for failing to exploit the patent have been limited to the failure to exploit the patent to the extent necessary to meet the demand for the original invention in Australia.

Public interest

222.          New paragraph 133(3)(e) provides that the grant of the licence must be in the public interest, and sets out factors for a court to consider when determining whether the public interest will be met.

223.          Current subparagraph 133(2)(a)(ii) provides that the court must be satisfied that the ‘reasonable requirements of the public’ with respect to a patent have not been satisfied, before it can make an order for a compulsory licence. Subsection 135(1) of the Patents Act sets out the circumstances in which the reasonable requirements of the public are taken not to have been satisfied.

224.          This test is not used elsewhere in Australian legislation, and there is limited case law to provide guidance on its interpretation, causing uncertainty. Furthermore, the ‘reasonable requirements of the public’ test appears to focus on the interests an individual trade or industry, preventing grant of a compulsory licence if industry would be prejudiced, even at a net cost to the broader community.

225.          This amendment replaces the ‘reasonable requirements of the public’ test with a ‘public interest’ test to determine if a compulsory licence should be granted. Unlike the term the ‘reasonable requirements of the public’, the term ‘public interest’ is a commonly used legal term with an existing body of case law which applies this terminology in a wide range of circumstances and will assist in its interpretation.

226.          The intent of the ‘public interest’ test is to recognise the balance required between the rights of the patent holder and the interests of the broader public.[37] New paragraph 133(3)(e) sets out three factors for the court to have regard to when considering the public interest:

(i)                 the benefits to the public from meeting the relevant unmet demand for the original patented invention;

(ii)               the commercial costs and benefits to the patentee and the applicant from providing authorisation to exploit the original patented invention;

(iii)             any other matters the court considers relevant, including those relating to greater competition and any impact on innovation.

Dependent patents

227.          New paragraph 133(3)(f) clarifies who can apply for a compulsory licence in the case of a dependent patent. The amendments make it clear that, in circumstances involving a dependent patent, it is only the patentee of the dependent patent who can seek a compulsory licence from the patentee of the original patent. Therefore, where an applicant, who is not the owner of the dependent patent, seeks a compulsory licence to exploit more than one patent, these should be made as separate applications.

228.          The additional circumstances in which a compulsory licence to exploit the original patent can be granted remain the same as in current subsection 133(3B): that the dependent patent cannot be exploited by the applicant without exploiting the original invention, and that the dependent invention involves an important technical advance of considerable economic significance on the original invention.

229.          As above, the previously used term ‘work’ has been replaced with ‘exploit’ for consistency with the rest of the Act.

Form of order

Dependent patents

230.          New subsection 133(3A) provides requirements for an order granting a compulsory licence to exploit an original patent where the applicant is the patentee of a dependent patent. These requirements are equivalent to those in current paragraph 133(3B)(b): that the patentee of the original invention must grant the compulsory licence only insofar as it is necessary to work the dependent invention, and that the patentee of the dependent invention must grant that patentee of the original invention, if he or she so requires, a cross licence to exploit the dependent invention.

231.          Combined with new paragraph 133(3)(f) above, this ensures that the cross-licence provides a form of reasonable compensation for the patentee of the original patent who is the subject of the compulsory licensing order, as the cross-licensing arrangements will only apply between the patentee of the original patent and the patentee of the dependent patent.

232.          As above, the previously used term ‘work’ has been replaced with ‘exploit’ for consistency with the rest of the Act.

General conditions

233.          New subsection 133(3B), for the most part, retains the text of current subsection 133(3) which provides requirements that an order for a compulsory licence must fulfil. Currently, an order for a compulsory licence must not give the licensee the exclusive right to exploit the original invention, and does not allow the licence to be assigned except in connection with an enterprise or goodwill with which the licence is used.

234.          New subsection 133(3B) retains these requirements. However, current subsection 133(3B) only applies to a compulsory licence for an original patent, not a dependent patent, leaving a gap in the legislation about how a court must direct a cross- licence must be granted. New subsection 133(3B) amends the term ‘the licence’ in current subsection 133(3) with ‘a licence’, thereby extending its application to licences which exploit the original invention or the dependent invention.

Public interest

235.          New subsection 133(3C) provides a mechanism for ensuring that the court is able to grant a licence on any other terms specified in the order that the court thinks fit. Such terms must be consistent with the public interest, having regard to the matters specified in paragraph 133(3)(e). This will provide the court with flexibility to take into account the individual circumstances of each case.

Item 7: Paragraph 133(5)(b)

[s 133]

236.          This item repeals paragraph 133(5)(b) and substitutes a new paragraph, which will amend the standard to which the Federal Court must have regard when determining the amount of remuneration to be paid to the patentee.

237.          When an order requiring the patentee to grant a compulsory licence to the applicant is made, the patentee is entitled to remuneration. Where the patentee and the applicant cannot agree, the Federal Court may determine the amount to be paid to the patentee.

238.          Currently, the standard of remuneration is determined on what is ‘just and reasonable having regard to the economic value of the licence and the desirability of discouraging contraventions of Part IV of the Competition and Consumer Act 2010 or an application law (as defined in section 150A of that Act).’

239.          The current remuneration standard does not adequately balance the interests of the patentee to obtain an appropriate economic return on their investment, and those of the public in having the demand for the invention met. This is particularly important in light of the changes to the conditions that must exist for a court to order the patentee to grant a compulsory licence made under item 6 of this Schedule.

240.          To remedy this problem, these amendments will require that where the Federal Court is to determine the remuneration to be paid to the patentee, the Federal Court must have regard to:

·         The economic value of the licence;

·         If the order is made because the court is satisfied that the patentee has contravened, or is contravening, the Competition and Consumer Act 2010, then the court will have regard to the desirability of discouraging contraventions of that Act;

·         The right of the patentee to obtain a return on investment commensurate with the regulatory and commercial risks involved in developing the invention; and

·         The public interest in ensuring that demand in Australia for the original invention is met on reasonable terms.

241.          This will provide guidance to the court on the principles for determining the remuneration to be paid to the patentee, whilst retaining flexibility for the court to take into account the individual circumstances of each case.

Item 8: Before subsection 133(6)

[s 133]

242.          This item inserts the subheading ‘Revocation of licence’ before subsection 133(6) to assist in the reading of section 133.

Item 9: Subsection 133(6)

[s 133]

243.          This item amends subsection 133(6) to replace the term ‘revoke the licence’ with ‘revoke a licence’. Currently subsection 133(6) only allows the court consider whether to revoke the compulsory licence for the original invention, but does not allow a cross-licence granted under paragraph 133(3B) to be revoked. This leads to a potentially inequitable situation. This change will allow cross-licences ordered under new paragraph 133(3B)(b) to be revoked by the court if the circumstances that justified its grant have ceased to exist.

Item 10: At the end of section 133

[s 133]

244.          This item is consequential on item 9 above, and provides that where the court revokes a licence under new subsection 133(6) of the Act, the court must also consider whether to revoke a cross-licence on a dependent patent made under new paragraph 133(3A)(b). Where the circumstances that necessitated the grant of a compulsory licence no longer exist, it is likely that the cross-licence will also no longer be required.

Item 11: Subparagraph 134(2)(a)

[s 134]

245.          This item repeals subparagraph 134(2)(a) and substitutes a new subparagraph. New subparagraph 134(2)(a) provides that, in order to make the order revoking the patent, the court must be satisfied that all of the conditions in subparagraphs (i) to (iii) apply. This change is consequential to the amendments described at item 6.

Item 12: Subsection 134(3)

[s 134]

This item inserts new subsection 134(3) which sets out the factors that the court must consider in determining whether it is in the public interest to revoke the patent. These factors are the same as those set out in section 133(3)(e), which are described above at item 6.

Item 13: Section 135

[s 135]

246.          This item repeals section 135, which sets out the circumstances in which the reasonable requirements of the public, with respect to a patented invention, are taken to not have been satisfied.

247.          This item is consequential to the changes described in item 6 as the ‘reasonable requirements of the public’ test will no longer be used.

Item 14: Schedule 1 (definition of work)

[Schedule 1]

248.          This item repeals the definition of the term “work” in Schedule 1 of the Patents Act, to ensure consistency with the rest of the Patents Act. This item is consequential to the repeal of section 135, discussed above at item 13.

Item 15: Application of Amendments

249.          Subitem 15(1) provides that the amendments made to section 133 of the Patents Act will apply to application for an order for a compulsory licence made on or after the day this Schedule commences.

250.          Subitem 15(2) clarifies that the amendment made to section 134 of the Patents Act will apply to applications for an order revoking a patent made on or after the day this Schedule commences, if the order granting a compulsory licence relating to the patent was made under section 133 of that Act after that day.

251.          Application provision 15(3) is a savings provision that ensures that the repeal of section 135 of the Act does not apply to applications for an order made under section 133 or 134 of the Act, if the application was made before the Schedule commences. This will allow a court to complete proceedings commenced relying on the ‘reasonable requirements of the public’ test.


 

Schedule 5 - Seals

Introduction

252.          This Schedule amends the Patents Act and the Trade Marks Act to allow for seals of the Patents and Trade Marks Offices to be kept in electronic form.

253.          IP Australia supplies certified documents to customers who request them for various reasons, such as a certified copy of a patent specification to establish a priority date for overseas filings, certificates for trade marks and designs, or as evidence for legal or other proceedings.

254.          The Designs Act allows for the seal of Designs Office to be kept and used electronically, which means that IP Australia can supply electronic certified copies of designs documents to its customers. In contrast, the Patents Act and the Trade Marks Act do not allow this. Receipt of paper copies is often inconvenient for customers, and the manual effort of sealing, signing and dispatching of the documents is time consuming and inefficient for IP Australia.

Patents Act 1990

Item 1: Patent Office Seal

[s 206]

255.          This item formats section 206 for the introduction of new subsection 206(2) by item 2 below.

Item 2 – Electronic seal – new provision

[s 206]

256.          This item inserts a new subsection 206(2) to allow the Patent Office to keep and use the official seal in electronic form. This will facilitate IP Australia supplying electronic certified copies of patent documents to customers.

Trade Marks Act 1995

Item 3 – Seal of Trade Marks Office

[s 200]

257.          This item formats section 200 for the introduction of new subsection 200(2) by item 4 below.

Item 4 – Electronic seal – new provision

[s 200]

258.          This item inserts a new subsection 200(2) to allow the Trade Mark Office to keep and use the official seal in electronic form. This will facilitate IP Australia supplying electronic certified copies of trade marks documents to customers.

Schedule 6 - Specifications

Introduction

259.          This Schedule amends the Patents Act to correct an oversight in the drafting of the Raising the Bar Act 2012 (Raising the Bar Act).

260.          Some types of patent claim make reference to the features of the invention disclosed in the description, drawings or examples. Such claims are known as ‘omnibus’ claims. Amendments to the Patents Act implemented under the Raising the Bar Act abolished omnibus claims in Australia. Section 40(3A) of the Patents Act now provides that claims must not rely on references to descriptions or drawings unless absolutely necessary to define the invention.

261.          However, due to drafting oversight the Raising the Bar Act only allowed this requirement to be considered and reported on during examination of standard and innovation patent applications. It failed to allow reporting on this requirement in various other stages such as amendment after acceptance of an application or after grant of a patent, re-examination, opposition or revocation proceedings, where currently other requirements under section 40 are considered.

Patents Act 1990

Items 1 to 6: requirements relating to complete specifications

[ss 59, 98, 101G, 101M, 102 & 138]

262.          Items 1 to 6 amend paragraphs 59(c), 98(a), 101G(3)(a), 101M(b), 102(2)(b) and 138(3)(f) to include reference to the requirement in subsection 40(3A). This allows for standard and innovation patent specifications to be assessed for their compliance against the requirement of subsection 40(3A) during re-examination, opposition or revocation proceedings, or when amendments are proposed to the specification.

Item 7: Application of amendments

263.          This item provides that the amendment of sections 59, 98, 101G, 101M, 102 and 138 applies only to patent specifications to which subsection 40(3A) of the Patents Act applies as a requirement during examination.

264.          Subitem 133(7) of Schedule 6 to the Raising the Bar Act provided that subsection 40(3A) of the Patents Act only applies to the applications and patents that meet the criteria specified in that item. That is, subsection 40(3A) only applies to standard patents and patent applications with an examination request date or filing date on or after commencement of Schedule 6 of the Raising the Bar Act, and innovation patents granted or certified, or innovation patent applications filed on or after commencement of Schedule 6 of the Raising the Bar Act. Schedule 6 to the Raising the Bar Act commenced on 15 April 2013.

265.          These application provisions allow the Commissioner and the courts to now consider compliance with subsection 40(3A) of the above patents or patent applications at re-examination, opposition, revocation or when amendments are proposed, from the day following the Royal Assent to this Bill.

266.          An immediate commencement is appropriate because it was never intended that applicants could prosecute the above categories of patents without complying with subsection 40(3A). Applications and patents for which this amendment applies are already required to satisfy subsection 40(3A) in order to be accepted. This amendment is therefore aligning all stages of the patent life-cycle to be consistent, as was originally intended in the Raising the Bar Act.

267.          It is appropriate that the Commissioner should be able to re-examine, and consider oppositions in respect of the full range of substantive grounds on which a patent was originally examined, regardless of when the application for the patent was filed, or the patent granted. It is also appropriate that applicants should not be able to amend their specification after examination such that it would not be acceptable if it were examined. Similarly, it is appropriate that the courts should be able to revoke a patent in respect of the full range of substantive grounds on which the patent was granted. This achieves the objective of increasing certainty in the validity of granted patents. It does not affect legitimate expectations of patentees, as it only applies to actions that take place after commencement, in respect of patents and patent applications that were always required to comply with subsection 40(3A) of the Patents Act.


 

Schedule 7 - Protection of information

Introduction

268.          This Schedule amends the Patents Act to improve the handling of sensitive information by the Commissioner of Patents.

269.          Patent applications and associated documents are published or made publicly available to ensure that the public benefits from knowledge of the invention. However, some patent applications can contain sensitive information that can be either commercial or personal in nature which is not essential to understanding of the invention, where publication is not appropriate.

270.          To avoid having to publish this information for patent applications under the PCT, the Patents Regulations were amended in 2016 by the Intellectual Property Legislation Amendment (Single Economic Market and Other Measures) Regulation 2016. The amendments allow both the International Bureau of WIPO and IP Australia to omit this sensitive information from publication for PCT applications, and instead allow publishing redacted versions.

271.          For standard and innovation patent applications and related documents, the Commissioner of Patents currently utilises a broad power under regulation 4.3 of the Patents Regulations to not publish certain documents. However the regulation focuses on ‘documents’ and not ‘information’ which means that the Commissioner does not clearly have the authority to redact parts of a document as opposed to an entire document. These amendments will resolve that ambiguity by providing clarification to allow the Commissioner to partially redact sensitive information from a patent document, and publish a redacted version.

Patents Act 1990

Item 1 – Documents open to public inspection

[s 55]

272.          Section 55 sets out which documents must be published when an application is open to public inspection. This item explains that section 55 is subject to the new provision to be introduced by item 3 below.

Item 2 – Certain documents and information not to be published or open to public inspection

[s 56]

273.          This is a consequential amendment as a result of item 3. The new heading clarifies that certain documents, as well as certain information contained within a document, are not to be published or be open to public inspection.

Item 3 – Certain documents and information not to be published or open to public inspection – new provision

[s 56]

274.          This item inserts new subsection 56(3) to provide the Commissioner with the power not to publish certain information contained within a document associated with a standard or innovation patent application if the Commissioner reasonably believes that information should not be published or open to public inspection. The amendments also provide that the Commissioner may arrange for a redacted version of the document to be published or be open to public inspection, which does not contain the information that should not be published. This will align the treatment of sensitive information of a document associated with a standard or innovation patent application with that of a PCT application under Rules 48.2(l), 94.1(d) and (e) of the Regulations under the PCT.

275.          It is intended that the test for withholding information would be analogous to the one in subregulation 4.3 of the Patents Regulations which allows the Commissioner to withhold a whole document on reasonable grounds. As with subregulation 4.3, the types of information that should not be published are not precisely circumscribed, because it is not possible to predict exactly what forms of information that should not be published might be included in documents. The amendments instead allow the Commissioner to exercise a reasonable discretion. Commercial or personal information that is not relevant to the working of an invention should not be published or be open to public inspection. For example, such information could include credit card details, or details of a person’s medical conditions.


 

Schedule 8 – International applications

Introduction

276.          This Schedule amends the Patents Act to remove the requirement to file a certificate of verification in relation to documents translated into English, unless the translation is required to be certified by the regulations.

Patents Act 1990

Item 1: International applications not filed in the receiving Office in English

[s 10]

277.          This item repeals subsection 10(2) and replaces it with new subsection 10(2). This new subsection provides a requirement that section 10 does not apply to an international application that was not filed in the receiving Office in English unless a translation of the application into English has also been filed. If required by the regulations, a certificate of verification (within the meaning of the regulations) must also be filed.

278.          This amendment replaces the existing requirement that a translation of the application into English, verified in accordance with the regulations, must be filed. This is an enabling provision that will allow the Patents Regulations to be amended so as to no longer prescribe certificates of verification must be filed in circumstances where certificates are unnecessary.

Item 2: Application of amendments

279.          This item provides that the amendment of subsection 10(2) applies only to an application filed on or after the day this Schedule commences.



[1] Productivity Commission 2016, Intellectual Property Arrangements, Inquiry Report No. 78, Canberra.

[2] Australian Government Response to the Productivity Commission Inquiry into Intellectual Property Arrangements, August 2017, accessible at https://www.industry.gov.au/innovation/Intellectual-Property/Pages/default.aspx

[3] Ibid, p 219, Recommendation 7.1

[4] Ibid, p 262, Recommendation 8.1

[5] Advisory Council on Intellectual Property 2015, Statement on the economic impact of the innovation patent system, accessible at https://www.ipaustralia.gov.au/about-us/public-consultations/archive-ip-reviews/ip-reviews/Review-of-the-Innovation-Patent-System

[6] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, Accessed 30 January 2018

[7] Productivity Commission, Inquiry Report, Compulsory Licensing of Patents, 2013, p.47

[8] Productivity Commission, 2016, Intellectual Property Arrangements, Inquiry Report No. 78, Canberra, pp 257

[10] Productivity Commission 2016, Intellectual Property Arrangements, Inquiry Report No. 78, Canberra, pp 239-262

[11] The Senate Community Affairs References Committee, 2010, Gene Patents, Canberra; Advisory Council on Intellectual Property, 2010, Patentable Subject Matter; Productivity Commission, 2016, Intellectual Property Arrangements, Inquiry Report No. 78, Canberra.

[12] Department of Industry, Innovation and Science, 2017, Australian Government Response to the Productivity Commission Inquiry into Intellectual Property Arrangements, p. 8.

[13] Advisory Council on Intellectual Property, 2010, Patentable Subject Matter, pp. 27-28.

[14] Productivity Commission, 2016, Intellectual Property Arrangements, Inquiry Report No. 78, Canberra.

[15] Article 7 of the Agreement on Trade-Related Aspects of Intellectual Property.

[16] Article 27 of the Agreement on Trade-Related Aspects of Intellectual Property.

[17] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra.

[18] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, p. 173.

[19] Advisory Council on Intellectual Property 2005, Review of Crown Use Provisions for Patents and Designs, Australian Government, Canberra.

[20] Australian Law Reform Commission 2004, Genes and Ingenuity: Gene Patenting and Human Health, Report no. 99.

[21] The Macquarie Dictionary Online © Macquarie Dictionary Publishers Pty Ltd.

[22] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, pp. 165-166.

[23] Patents Act 1990 (Cth), s. 165(2)

[24] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, p.178.

[25] Advisory Council on Intellectual Property, 2005, Review of Crown Use Provisions for Patents and Designs, p. 28.

[26] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, p.181.

[27] Advisory Council on Intellectual Property, 2005, Review of Crown Use Provisions for Patents and Designs, p. 4.

[28] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, p. 173.

[29] Advisory Council on Intellectual Property 2005, Review of Crown Use Provisions for Patents and Designs, Australian Government, Canberra.

[30] Australian Law Reform Commission 2004, Genes and Ingenuity: Gene Patenting and Human Health, Report no. 99.

[31] The Macquarie Dictionary Online © Macquarie Dictionary Publishers Pty Ltd.

[32] Designs Act 2003 (Cth), s. 98(1)(b)

[33] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, p.178.

[34] Advisory Council on Intellectual Property, 2005, Review of Crown Use Provisions for Patents and Designs, p. 28.

[35] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, p.181.

[36] Advisory Council on Intellectual Property, 2005, Review of Crown Use Provisions for Patents and Designs, p. 4.

[37] Productivity Commission 2013, Compulsory Licensing of Patents, Inquiry Report No. 61, Canberra, Accessed 30 January 2018, p 151