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Tuesday, 8 August 2006
Page: 73

Senator VANSTONE (Minister for Immigration and Multicultural Affairs) (5:43 PM) —I move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—


This bill is an omnibus bill that amends several pieces of intellectual property legislation.

The bill amends the Patents Act 1990 to implement part of the Government’s response to two reports into the intellectual property system, and to broaden the patent ‘springboarding’ scheme for generic pharmaceuticals.

The bill also amends the Trade Marks Act 1995 to provide the Registrar of Trade Marks with the power to revoke trade marks which have been registered as a result of administrative errors or oversights. It will also simplify the process for making documents relating to trade marks more readily available to the public.

The bill also makes a number of other minor amendments to the Patents and Trade Marks Acts, and to the Designs Act 2003, the Plant Breeder’s Rights Act 1994 and the Olympic Insignia Protection Act 1987.

The bill implements several recommendations of a report by the Intellectual Property and Competition Review Committee, entitled “Review of the Intellectual Property Legislation under the Competition Principles Agreement”, which is commonly known as the “Ergas report”. The bill also implements a further recommendation of a report by the Advisory Council on Intellectual Property, commonly known as ACIP, entitled “Review of Enforcement of Industrial Property Rights”.

The Ergas report focussed on achieving an appropriate balance between intellectual property policy and competition policy. The ACIP report addressed issues concerning the enforcement of patent rights. By implementing these recommendations, the Government will increase the strength of granted patents, and will ensure that third parties are not adversely affected by the grant of patent rights.

Some of the recommendations of these reports have already been implemented by the Government, in the Patents Amendment Act 2001 and the Intellectual Property Laws Amendment Act 2003. Several of the outstanding recommendations of these reports are implemented in this bill.

The bill implements one recommendation of the Ergas report by amending the ‘prior use’ defence to patent infringement, which protects a person who was exploiting a product, method or process covered by a patent before the patent was filed. This provision balances the rights of the prior user and the person who is subsequently granted the patent. This amendment clarifies the operation of this defence to infringement, and overcomes some deficiencies in the drafting of the current provision.

The bill implements another recommendation of the Ergas Report by amending the Patents Act to add a new ground on which a compulsory licence to use a patent may be granted. Under the existing provisions of the Patents Act, a compulsory licence to use a patent may be granted if the patent owner is not meeting the reasonable requirements of the public in respect of the patented invention. This amendment to the Patents Act will retain this existing test for the grant of a compulsory licence, and will add an additional provision, making the compulsory licensing of patents subject to a competition test.

The bill implements a recommendation of the ACIP report by amending the Patents Act to specifically prescribe that a court can award exemplary damages in patent infringement actions, for example, in the case of flagrant or wilful infringement of a patent. This will be in addition to the currently prescribed remedies of an account of profits or damages to recover losses caused by infringement.

This is intended to serve as a deterrent against flagrant and wilful infringement of patents, which will in turn strengthen patent rights. This will also bring the Patents Act into line with the Designs Act and the Copyright Act 1968, under which exemplary damages may also be awarded.

The bill also implements a wider ‘springboarding’ scheme for generic pharmaceuticals than is currently provided under the Patents Act. Springboarding is a colloquial term that refers to using the subject matter of a patent to collect the data required to obtain regulatory approval of a generic version of the patented drug, when the patent is still in force. This allows generic pharmaceutical manufacturers to establish that their generic pharmaceutical product is bioequivalent to the original product before the patent expires and have it ready for the market upon patent expiry.

Previously, the Patents Act contained a limited provision that only allowed springboarding on pharmaceutical patents that had received an extension of patent term. Consequently, Australia’s springboarding provisions have been more limited than those in competitor countries. Without this amendment, generic pharmaceutical companies would be pushed into undertaking research and development work offshore and then bringing their product into Australia upon patent expiry. This amendment corrects this investment disincentive without impacting on the current market environment.

The new provision allows springboarding as an exception to patent infringement on any pharmaceutical patent at any time, for purposes solely in connection with gaining regulatory approval of a pharmaceutical product in Australia or another territory, to the extent allowed by Australia’s international obligations.

Under the amended provisions, generic pharmaceutical companies would not be able to manufacture quantities of the product for export, set up to manufacture quantities prior to patent expiry or stockpile quantities for later sale while the patent is still in force, as these activities would be inconsistent with Australia’s international obligations in relation to the World Trade Organization’s Agreement on the Trade-Related Aspects of Intellectual Property Rights, which is commonly known as the TRIPS Agreement.

The objective of this change to the springboarding provisions is to encourage generic pharmaceutical development in Australia, consistent with the National Medicines Policy objective of maintaining a responsible and viable medicines industry.

The bill also amends the Trade Marks Act to allow the Registrar of Trade Marks to revoke the registration of trade marks in circumstances in which the trade mark should not have been registered in the first place. This provision would be used, for example, when a trade mark is registered as a result of an error or oversight on the part of the Trade Marks Office while assessing an application for registration of a trade mark. While such errors are rare, they do occur from time to time. They have the potential to cause confusion in the marketplace, and to give the owner of the trade mark that was registered in error some benefits to which they are not legitimately entitled under the Trade Marks Act. This situation does not serve the interests of owners of other registered trade marks who are affected by incorrectly registered trade marks, nor of the public generally.

The amendments will provide a quick and simple way for the Trade Marks Office to have administrative errors and oversights of this nature rectified, which will be more efficient than having to seek redress in the courts. The provisions balance the rights of the owner of the registered trade mark by limiting the time and circumstances in which the Registrar is able to revoke the mark. They will achieve this by specifying factors the Registrar of Trade Marks will have to take into account when deciding whether to revoke a registration, and by allowing the decision of the Registrar of Trade Marks to be appealed to the Federal Court.

The bill also amends the Trade Marks Act to make the majority of documents held by the Trade Marks Office that relate to applications for registration of trade marks publicly available and easily accessible. Members of the public frequently find it necessary to access such documents for a variety of reasons. The most common reason is in the case of a party that is considering opposing the registration of a particular trade mark. There is a strong public interest in keeping invalid trade marks off the Register of Trade Marks, so there is a public interest in ensuring that oppositions of this nature proceed quickly and efficiently. The amendment will also have the effect of increasing the transparency of the functions of the Trade Marks Office.

This amendment will provide a quick and efficient system of accessing relevant documents on trade mark files, which will increase the efficiency of the administration of the trade marks system.

Businesses frequently have to file commercially sensitive information when seeking registration of trade marks. The amendments will also enable the Trade Marks Office to accept information of this nature in confidence, to ensure that the new system for access of trade marks documents will protect the interest of persons supplying sensitive information to the Trade Marks Office.

This bill also makes a number of other minor and technical amendments to the Patents Act, the Trade Marks Act, the Designs Act, the Plant Breeder’s Rights Act and the Olympic Insignia Protection Act, including clarifying the effect of the Patent, Trade Marks, Designs and Plant Breeder’s Rights Offices not being open for business, for example, due to an emergency situation such as a bushfire. The amendments will allow a prescribed person to declare that the offices are not open for business in such circumstances. These amendments ensure that parties doing business with these Offices are not adversely affected by closures of these Offices. The bill also makes some technical amendments to the Plant Breeder’s Rights Act to increase the efficiency of the administration of the plant breeder’s rights system, and to facilitate integration of the administration of the Plant Breeder’s Rights Act within IP Australia.

The amendments in this bill will result in stronger registered intellectual property rights and improve the administration of the intellectual property system. The bill reflects the Government’s commitment to encouraging innovation and providing Australia with a strong intellectual property system that meets the needs of Australians.

Debate (on motion by Senator Vanstone) adjourned.