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11 September 2017

Government releases response to Productivity Commission’s report on Australia’s intellectual property arrangements

The government supports the majority of the Commission’s recommendations in its report into Australia’s IP arrangements, and will undertake further public consultation before seeking to implement some of the recommendations.

The Commission’s inquiry

In its inquiry, the Commission sought to assess whether Australia’s current IP arrangements strike an appropriate balance between offering incentives to innovation, investment and the production of creative works whilst also enabling appropriate access to ideas and products and facilitating further innovation, competition and investment.

The Commission’s report which was publicly released on 20 December 2016 concluded that Australia’s IP arrangements require a number of reforms to achieve these objectives. There is a summary of this report.

The government released its response to the recommendations on 25 August 2017.

Response to recommendations

The government’s response addresses all of the Commission’s major proposals and:

  • supports 11 recommendations in full and 4 in principle
  • partly supports and partly rejects 3 recommendations
  • notes 7 recommendations without proposing further action.

Key reforms

IP policy

The government supports the recommendation that Australian Government IP policy be informed by a robust evidence base that it is guided by the principles of effectiveness, efficiency, adaptability and accountability. The government considers that these principles encompass key economic factors while recognising the importance of balancing the interests of innovators, investors and creators with the welfare and interests of consumers and Australian society as a whole.

Copyright

Fair use

The government notes the Commission’s recommendation to replace the current fair dealing provisions with a fair use exception, and acknowledges that Australian exceptions have been considered narrow by international standards and may not permit some reasonable fair uses.

However, the government acknowledges the complexity of the issue and that there are different approaches available to address it. As such, the government plans to publicly consult on this issue in early 2018 before taking further action.

Orphan works

The government supports the proposal to limit liability for the use of orphan works where the user has been unable to identify the author through diligent searches. It proposes to consult on the most appropriate way to limit liability for use of these works.

The government also highlighted the recent amendments in the Copyright Amendment (Disability and Other Measures) Act 2017 (Cth) limiting the term of protection for unpublished works, including orphan works.

Contracting out and TPMs

The government supports in principle the recommendation to amend the Copyright Act 1968 (Cth) to:

  • make unenforceable any part of an agreement restricting or preventing a use of copyright material that is permitted by a copyright exception
  • permit consumers to circumvent technological protection measures (TPMs) for legitimate uses of copyright material.

The response recognises the inefficiencies and uncertainty that can arise from agreements which seek to limit or exclude permissible uses of copyright material. The government will consult on how to implement these proposals.

The government will also consider creating new TPM exceptions (including those relating to geoblocking) as part of a forthcoming review of the Copyright Regulations 1969 (Cth).

Collecting societies

The government supports the recommendation to strengthen the governance and transparency arrangements for collecting societies. It supports a review of the voluntary Code of Conduct for Copyright Collecting Societies to ensure the efficient, effective and transparent administration of copyright licences.

Parallel importation of books

The government supports in principle the repeal of parallel import restrictions on books, subject to further consultation with the book industry to develop a reform pathway that is in the public interest.

Safe harbours for online service providers

The government supports in principle the recommendation to expand the ‘safe harbour’ scheme to all providers of online services (not just carriage service providers). However, it is engaging in further consultation before deciding whether to amend the CopyrightAct.

Patents

The government is in favour of amending the Patents Act 1990 (Cth) to:

  • include an objects clause to provide a clear statement of legislative intent designed to balance the interests of producers, owners and users of technology following further public consultation
  • align the test for ‘inventive step’ with the approach taken by the European Patent Office
  • abolish the innovation patent system
  • require applicants to identify the technical features of their claimed invention.

However, it does not currently intend to implement the Commission’s recommendations to restructure patent fees or to restrict extensions to pharmaceutical patent terms. 

The government supports in principle a system for transparent reporting and monitoring of potentially anti-competitive conduct between pharmaceutical patent holders and generic manufacturers to detect pay-for-delay agreements.

Trade marks

The government supports reducing the ‘grace period’ for non-use actions from 5 to 3 years and supports in principle a requirement that applicants certify their intention to use a relevant mark to reduce ‘trade mark cluttering’ on the Trade Marks Register.

However, it plans to retain the presumption of registrability for marks in relation to all grounds of rejection.

The government also supports the Commission’s proposal to link the business registration portal with the Australian Trade Mark Search, but raised concerns that the technology could not accurately and comprehensively generate automated trade mark infringement warnings.

IP and competition law

The government supports repealing s 51(3) of the Competition and Consumer Act 2010 (CCA), which currently exempts certain IP licensing and assignment arrangements from the prohibitions on anti-competitive practices in Part IV of the Act. However, it supports doing so in conjunction with giving effect to the Competition Policy Review recommendations on per se prohibitions in Part IV of the CCA.

Administration of IP policy

The government supports promoting a coherent and integrated approach to IP policy development by:

  • establishing and maintaining greater IP policy expertise in the Department of Industry, Innovation and Science (DIIS) (A dedicated DIIS IP Policy Unit was established in April 2016.)
  • establishing and maintaining a standing (interdepartmental) IP Policy Group and formal working arrangements to support a coordinated approach to IP policy development. (This group has been established and currently comprises senior officials from 9 departments and agencies. It is chaired by the Deputy Secretary of DIIS.)

Public institutions

The government supports the recommendation to provide open access arrangements for all publicly funded research within 12 months of publication.

Further information

AGS will also be hosting an IP forum in which we will discuss various aspects of this topic in more detail. If you would like to be on our mailing list for that forum, please email michelle.easte@ags.gov.au.

For further information please contact:

Rachel Chua
Senior Executive Lawyer
T 02 6253 7086
rachel.chua@ags.gov.au

Kenneth Eagle
National Manager Commercial
T 03 9242 1290 M 0419 562 390
kenneth.eagle@ags.gov.au

Adrian Snooks
National Leader Commercial
T 02 6253 7192
adrian.snooks@ags.gov.au

Important: The material in Express law is provided to clients as an early, interim view for general information only, and further analysis on the matter may be prepared by AGS. The material should not be relied upon for the purpose of a particular matter. Please contact AGS before any action or decision is taken on the basis of any of the material in this message.