Australia’s Innovation Patent to be abolished by legislation now passed in Federal Parliament

Australia’s second-tier “innovation patent” – rumours of its demise have (unfortunately, not) been greatly exaggerated.

 

 

The Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019 has now passed with a clear majority through both houses of Australia’s Federal Parliament.  The headline act of the new legislation is that it contains provisions to abolish the innovation patent system.  As explained below, these will now come into effect in a little over 18 months’ time.  However, significantly, existing innovation patent rights (and those applied for in the interim) will not be affected.

 

What you need to know

“Abolish” is probably too strong a term to describe the changes.  Rather, the innovation patent system is to be “phased out” over the best part of the next decade.  Importantly, though, applications for new innovation patents will need to be filed within 18 months of the date of commencement of the new legislation (the day Royal Assent is provided; this is anticipated within the next month).  The Government’s original proposal had been for a 12-month commencement window, but this was changed to 18 in part-exchange for the Opposition’s support in passing the legislation.

Can I still file innovation patent applications?

 Yes, subject to the following transitional provisions:

  1. The legislation is passed into law (i.e., receives the required Royal Assent) on “date-X”. For the purposes of filing new innovation patents, it takes effect from “date-Y”, which is 18 months from date-X.
  1. At any time prior to date-Y (i.e., between now and date-X, and then between dates X and Y), new innovation patent applications can be filed. In other words, nothing changes until the legislation takes effect on date-Y.
  1. As of date-Y, no new innovation patent applications can be validly granted. However, an existing standard patent application (i.e., having a filing date prior to date-Y) can still be converted into an innovation patent, or can have a divisional innovation patent filed from it.
  1. With innovation patents having an 8-year term, it will be appreciated that all innovation patents will have expired by “date-Z” (effectively, date-Y+8 years).

 

Innovation patent timeline

 

Is this a popular move?

The Institute of Patent and Trade Mark Attorneys of Australia (IPTA) is the peak professional body charged with representing the views of our local profession.  IPTA has always maintained a position diametrically opposed to that now adopted formally by the Government:

IPTA remains of the view that the innovation patent system remains an appropriate means to stimulate innovation by Australian small to medium business enterprises and that it is an appropriate means for protecting lower level inventions that may not be entitled to standard patent protection. IPTA also believes that the innovation patent system also continues to serve the function of providing a fast route to a granted and certified patent which can be used in enforcement action in a similar manner to the former petty patent.

A more recent prescription of IPTA’s position was provided in an article published by my colleague, Dr Grant Shoebridge.  Grant has been especially prominent in IPTA’s lobbying to retain the innovation patent:

IPTA opposes the abolition of the innovation patent system and rather supports revision of the system, which includes raising the threshold of innovative step and introduction of mandatory examination. This view is supported by a number of industry groups, including the Australia Chamber of Commerce and Industry, which represents more than 300,000 Australian businesses.

We understand that there remains strong support for the innovation patent system within Australia’s patent attorney profession as a whole.

Need more information about innovation patents?

A few months back, I published a bit of a SWOT analysis of Australia’s innovation patent.  My conclusion was that the “punishment” (abolition/phasing out) should fit the “crime” (three principal failings, two of which were readily correctable).

Next steps?

As noted above, the next step in the legislative process is that the Bill receives Royal Assent. In Australia, this is generally a formality and often takes place within a month of new legislation being passed.

Once Royal Assent is obtained, we will then know our “Date-X”, “Date-Y” and sunset “Date-Z”.  Of course, we will keep readers apprised of developments.

What else was included in the legislation?

Although the phasing out of the innovation patent was unquestionably the headline act of the new legislation, it certainly wasn’t the only feature.  The Bill further amends the Patents Act 1990 to: introduce an objects clause; replace the “reasonable requirements of the public” test in relation to applications for a compulsory licence with a public interest test; provide that only the patentee of a dependent patent can seek a compulsory licence over the use of the original patent; provide for omnibus claims in patent specifications to be removed at stages of consideration subsequent to examination; clarify the Commissioner of Patents’ power to redact sensitive information from patent documents; remove the requirement to file a certificate of verification for documents translated into English, unless required by the regulations; clarify 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; require governments to seek negotiated outcomes with patent owners before invoking Crown use; and require ministerial authorisation for invoking Crown use if a negotiated outcome is unsuccessful or in emergency situations.  The Bill amends the Designs Act 2003 to modify provisions relating to Crown use consistently with the changes to the Patents Act 2003; and Patents Act 1990 and Trade Marks Act 1995 to enable the Patent Office and Trade Mark Office to keep and use their official seal in electronic form when supplying electronic certified copies of documents to customers.