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Intellectual Property Laws Amendment Bill 1998

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1997

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

INTELLECTUAL PROPERTY LAWS AMENDMENT BILL 1997

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

(Circulated by authority of the Minister for Industry, Science and Tourism,

 the Hon John Moore MP)

 

 

 

11162 Cat. No. 97 1694 7 ISBN 0644 368403

 

 



INTELLECTUAL PROPERTY LAWS AMENDMENT BILL 1997

 

OUTLINE

 

The Bill amends the Patents Act 1990 to give effect to the government’s decision to provide for an extension of term scheme for pharmaceutical patents.  An extension of up to five years will be available for a standard patent relating to a pharmaceutical substance that is the subject of first inclusion on the Australian Register of Therapeutic Goods.  The scheme will apply to all existing 20 year patents, as well as those patents granted after the commencement date.

 

The new arrangements make provision for ‘spring-boarding’ activities.  This allows manufacturers of generic drugs to undertake certain activities at any time after the extension is granted solely for the purposes of meeting pre-marketing regulatory approval requirements.

 

The Bill also amends the Copyright Act 1968, Patents Act 1990 , Trade Marks Act 1995 and the Designs Act 1906 to give effect to the revised regulatory regime for patent attorneys and the creation of a class of practitioner called trade marks attorneys.

 

These amendments create the new Professional Standards Board for Patent and Trade Marks Attorneys and allow for changes to the registration system. The partnership arrangements are changed to allow mixed partnerships including patent attorney members and a greater access to professional training.  Professional practice in trade marks and designs will be deregulated. The new registered trade marks attorney will have the same right of privilege over communication and the same exemptions from provisions of the copyright legislation as patent attorneys.  They will be subject to the same disciplinary provisions as patent attorneys. Restrictions on the use of the term “agent for obtaining trade mark” will be removed.

 

The Bill also introduces other minor amendments to the Patents Act 1990.  Amendments will allow employees of the Patent Office to provide a higher level of advice to applicants while not compromising their official duties and revise procedures for the payment of certain fees.

 

Financial Impact Statement

 

The extension of patent term scheme for pharmaceuticals will result in an additional cost to the Pharmaceutical Benefits Scheme (PBS).  This cost is incurred as a result of the delay in the introduction of lower price generic products onto the PBS and hence the reduction in prices of the originator products.  The first cost will be incurred in 2001-02 and is estimated at approximately $6 million, against total PBS costs of $4 000 million.  Costs escalate and peak at a maximum of around $160 million in 2005-06.  These costs should be regarded as indicative only as there is some difficulty in forecasting the availability and impact of generic drugs over a relatively long period.  Other costs associated with the scheme will be funded by increased revenue from annual maintenance fees on patents with extended terms.

 

There would be no direct costs to Government from the other amendments as the patents, trade marks and designs systems including regulation of the profession, operate on a cost recovery basis. Increased competition for the provision of professional advice should afford users of the trade marks and designs systems lower costs in respect of the provision of the advice.



REGULATION IMPACT STATEMENTS

 

 

1.         EXTENSION OF TERM SCHEME FOR PHARMACEUTICAL PATENTS

 

 

1.         Background

 

In 1993, the former Government announced that Australia would introduce an extension of term scheme for pharmaceutical patents.  A number of options were developed to provide extensions of up to five years to the standard 20 year patent term, however, a decision on which option should be implemented was not reached prior to the election in March 1996.  Since then, further consultations have been undertaken on both the impact of options for providing, as well as the impact of not providing, an extension of term scheme.

 

The Minister for Industry, Science and Tourism, in presenting the Government’s final response to the Industry Commission’s Report No. 51, The Pharmaceutical Industry , announced in April 1997 that the Patents Act 1990 would be amended to provide for an extension of term of up to five years for pharmaceutical patents.

 

Extensions of up to five years on the standard 20 year term are available for pharmaceutical patents in the United States, the European Union and Japan in recognition of the exceptionally long development time and regulatory requirements involved in developing and commercialising a new drug.  The aim is to provide an ‘effective patent life’, or period after marketing approval is obtained during which companies are earning a return on their investment, more in line with that available to inventions in other fields of technology.

 

The World Trade Organization (WTO) Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) obliges countries to provide certain exclusive rights to all patents for a minimum of 20 years.

 

 

2.         Problem or Issue Identification

 

The development of a new drug is a long process, estimated to average around 12 years, which requires a new chemical entity to be patented early in the process in order to secure its intellectual property rights.  However, considerable research and testing is still required before the product can enter the market.  As a consequence, patentees of new drugs usually have considerably fewer years under patent in which to maximise their return.

 

It is expensive to bring a drug to market, around US$380 million, and involves considerable risk.  As such, research based pharmaceutical companies rely heavily on patents to generate the substantial cash flows needed to finance the development of new drugs from the discovery stage, through the pre-clinical and clinical development phases, to eventual marketing.

 

A country’s patent system is also an important factor in contributing to a company’s decision on whether to invest or not.  If Australia has a weak patent system, relative to it’s competitors, there is a risk that investment in research and development will be lost to those offering stronger patent protection.



3.         Specification of the desired objective(s)

 

The objective of this proposal is to provide an ‘effective patent life’ ¾ or period after marketing approval is obtained, during which companies are earning a return on their investment ¾ more in line with that available to inventions in other fields of technology.  It is also intended to provide a patent system which is competitive with other developed nations.

 

 

4.         Identification of options (regulatory and non-regulatory)

 

The options which could be considered to address the issues arising out of the objective of this proposal are:

 

Option 1:         No specific action

Option 2:         Extension of term scheme for pharmaceutical patents:

·          Sub-option 2A—extension of term of up to five years for pharmaceutical patents, with no spring-boarding

·          Sub-option 2B—extension of term of up to five years for pharmaceutical patents, with spring-boarding during the extended term

·          Sub-option 2C—extension of term of up to five years for pharmaceutical patents, with spring-boarding at any time after the extension is granted

 

 

5.         Assessment of impacts (costs and benefits) of each option

 

Option 1         No specific action

 

Benefits and Costs to the Pharmaceutical Industry

 

If an extension of term scheme for pharmaceutical patents was not introduced, the pharmaceutical industry would still have access to a system which provides the owners of inventions with the legal right to prevent others from making or using their invention for the same period of time as for other technologies.

 

However for manufacturers and developers of patented drugs, the level of protection provided under the present patent system is less than that provided for other fields of technology, because of the longer time lost in developing and gaining marketing approval for new drugs.  The industry thus gains a limited return on its investment and is restricted in its capacity to invest in the development of new products.

 

A decision not to extend the patent term could send a negative signal about the Australian climate for investment in pharmaceutical research and development.  Australia would be less competitive in attracting research and development, with flow on effects to local research institutions, many of whom rely on funding through collaborations with global companies.



Benefits and Costs to Consumers

 

Continuation of the current arrangements results in earlier access of generic products onto the market.  In many cases, this does not have any impact on consumers but rather, generates savings to the Government.  In some cases however, consumers pay a brand premium because originator companies do not reduce their prices to that of the generic.

 

If companies are unable to achieve an appropriate return on products, the development and availability of new drugs could be compromised as the industry would have a lesser capacity to invest in research and development of new innovative drugs.

 

Benefits and Costs to the Government

 

The investment momentum being generated by the current arrangements and Australia’s comparative strengths which have been developed, for example through long term public investment in education and training, and support of world class medical research, may be dissipated as activity moves offshore to take advantage of arrangements available in developed other countries.

 

In 1996/97 the Pharmaceutical Benefits Scheme (PBS) cost the Government approximately $2.5 billion.  If there was no extension of term scheme introduced there would be no additional costs to the PBS.

 

Option 2         Extension of term scheme for pharmaceutical patents

 

Benefits and Costs to the Pharmaceutical Industry

 

A decision to provide patent protection comparable with that available in many developed countries would contribute positively to perceptions that Australia values an innovative pharmaceutical industry.

 

A domestic pharmaceutical industry provides valuable leverage for Australian subsidiaries of multinational companies to secure additional high value adding manufacturing activities and to establish longer term collaborative ventures with Australian researchers and companies.  A local presence also forges alliances to facilitate technology and knowledge transfer to Australia.

 

If the Government wishes to optimise Australian industry activity and employment, it will apply the extension of term scheme from a very early date.  Applying the scheme to all existing patents would maximise returns to research based companies in Australia which could be re-invested in further Australian research and development.  However, transitional arrangements would be required to ensure that generic manufacturers which have commenced spring-boarding on older ‘pre-TRIPS’ patents—being those expiring prior to 1 July 1999—are not commercially disadvantaged by being prevented from entering the market as planned.  Industry has advised that it would be inevitable that such transitional arrangements would give rise to prolonged legal disputes and further uncertainty.  This was the case when similar arrangements were introduced in the United States.

 

Applying the scheme to patents with a standard 20 year term would avoid or substantially reduce the need for transitional arrangements and would minimise impact on the generic market.  This needs to be set against the risk to Australian companies which have already made arrangements to source generic products from overseas in anticipation of entering the Australian market soon after patent expiry.  However, in the normal course of events, gearing-up for production or marketing would not occur in Australia until the last two years of the patent term, which generally would not be before the second half of 1997.

 

On balance, therefore, the preferred approach is to apply the scheme to all standard 20 year patents.

 

Benefits and Costs to Consumers

 

The introduction of an extension of term scheme could delay the introduction of lower priced generic drugs on the PBS, which in itself may not affect consumers.  However, in some cases, consumers pay a brand premium because originator companies do not reduce their prices to that of the lower priced generic.

 

However, these delays can be reduced by allowing spring-boarding prior to patent expiry so that generic products can access the market as soon as the patent expires.  With adequate spring-boarding provisions, the average delay of the introduction of generic products would be no more than four to five years (being the length of the average extension).

 

If companies are unable to achieve an appropriate return on products, the development and availability of new products could be compromised as the industry would have a lesser capacity to invest in the research and development of new innovative drugs.

 

Benefits and Costs to the Government

 

Extending the term of pharmaceutical patents will result in an increased cost to the PBS through the later availability of some generic drugs.  These drugs are generally listed on the PBS at a lower price than the originator products, and that lower price sets the level of the Government subsidy for all similar products.

 

In applying the extension to all 20 year patents and new patents, the first cost will be incurred in 2001-02 and is estimated at approximately $6 million, against total PBS costs of $4 000 million.  Costs escalate and peak at a maximum of around $160 million in 2005-06.  These costs should be regarded as indicative only as there is some difficulty in forecasting the availability and impact of generic drugs over a relatively long period.

 

If an extension of patent term was applied to new patents, that is those initiated after 1 July 1997, no costs would be incurred until 2018-19.  However, costs would escalate and peak in 2021-22 at approximately $210 million.

 

An extension of patent term scheme would result in some administrative costs for the Australian Industrial Property Organisation, which administers the Patents Act 1990 .  However, these would be offset by increased revenue from the annual maintenance fees on patents with an extended term.

 



Sub-option 2A           Extension of term of up to five years for pharmaceutical patents,                                   with no spring-boarding

 

‘Spring-boarding’, which allows generic drug producers to undertake activities solely for the purposes of meeting pre-marketing regulatory requirements prior to patent expiry, is not allowed in either the European Union or Japan.  It is allowed in the United States and Canada and was part of Australia’s previous extension of term scheme which expired in 1995.

 

If an extension of term without spring-boarding were introduced, delays in the marketing of generic products of at least two to three years after patent expiry can be expected, while generic development work is undertaken.  This would provide a de facto increase the effective patent period.

 

A patents regime which lacks the flexibility to allow spring-boarding would also put at risk generic development and manufacturing in Australia.  This is because of the significant advantage which derives from being first in the market with a generic product.  A lack of spring-boarding provisions in Australia will encourage generic drug importers to undertake development work offshore, in countries like the United States, which allows spring-boarding throughout the patent term, or in countries with weak patent protection and access the Australian market immediately the patent expires.

 

Given the link between drug development and manufacturing, it is likely that in the longer term most or all generic drug activity will be taken offshore, so companies can avoid being placed at a competitive disadvantage to their international competitors.  At risk is a generic drug sector currently worth approximately $600 million per annum to Australia, plus spillovers into employment and collaborative development work.

 

This sub-option complies with the TRIPS Agreement because it provides certain exclusive rights to patents for pharmaceuticals for a minimum of 20 years.

 

Sub-option 2B            Extension of term of up to five years for pharmaceutical patents,                                   with spring-boarding during the extended term

 

An extension of term scheme with spring-boarding provisions would assist in encouraging the continued development of the pharmaceutical research sector in Australia, while also enabling Australian generic producers to compete with offshore generic drug developers.

 

Allowing spring-boarding only during the extension would preserve intact the full rights of patentees throughout the initial 20 year term, sending a stronger signal internationally about the Australian climate for investment in research and development.  However, in some cases ¾ that is, where the extension of term is relatively short or the product is very complex ¾ Australian generic producers could be placed at a comparative disadvantage relative to their international competitors by allowing too little time for the development of generic drugs in Australia.

 

Spring-boarding could be open to challenge through the WTO dispute mechanism on the grounds that it does not comply with Article 28 of the TRIPS Agreement.  However, Article 30 of TRIPS allows Members to the Agreement to provide limited exceptions to the exclusive rights conferred by a patent, provided that such exceptions do not unreasonably conflict with the normal exploitation of the patent and do not unreasonably prejudice the legitimate interests of the patent owner.  The United States and Canada provide for spring-boarding under this exception.

 

As the activities allowed during spring-boarding are limited to matters pertaining to obtaining pre-marketing regulatory approval for the generic drugs and not the manufacturing for sale or use of the drug, spring-boarding under this sub-option complies with the TRIPS Agreement.

 

Sub-option 2C           Extension of term of up to five years for pharmaceutical patents,                                   with spring-boarding at any time after the extension is granted

 

Allowing spring-boarding at any time after an extension is granted would place Australian companies on a more equal footing with their international competitors.  It would do so without reducing the period during which the originator company retains an exclusive right to sell its product on the Australian market.

 

This option also reduces the risk of pushing development work on generic drugs offshore, either to the United States where spring-boarding is allowed, or to countries providing weak patent protection.  It also gives the industry more flexibility in preparing to access the Australian market

 

As such, this option would be of particular benefit to Australia’s fledgling pharmaceutical active ingredient manufacturers as well as to Australian producers of ‘innovative’ generic drugs.

 

This sub-option is in line with the extension of term scheme provided in the United States.  That is, the United States provides for an extension of a drug’s patent term equal to the period of regulatory review, to a maximum of five years, to a maximum effective patent period of 14 years from marketing approval.  Generic activities solely for uses related to the development and submission of information to the Food and Drug Authority can take place at any time.

 

As with the previous sub-option, this may be open to a WTO challenge, however Australia is confident that spring-boarding is allowable as an exception under Article 30 of the TRIPS Agreement.

 

 

6.         Consultation

 

In 1993, the former Government announced that Australia would introduce an extension of term scheme for pharmaceutical patents.  A number of options were developed to provide extensions of up to five years to the standard 20 year patent term.

 

Extensive public consultations on options for the provision and implementation of an extension of term scheme were undertaken with the pharmaceutical industry, the Australian Pharmaceutical Manufacturers Association and the legal profession.

 

In addition, a number of Government Departments and agencies were involved in developing the new extension of term scheme, namely the Department of the Prime Minister and Cabinet, the Treasury, the Department of Finance, the Department of Foreign Affairs and Trade, the Attorney-General’s Department and the Department of Health and Family Services.

 

Overall the pharmaceutical industry has been supportive of the extension of term scheme as it sends a strong message both domestically and internationally that the Government is committed to a stable, consistent and positive environment for the industry in Australia.

 

 

7.         Conclusion and recommended option

 

Although there are some costs to the Government and the generic pharmaceutical industry if an extension of term scheme is implemented.  A strong patent system is an important contributor to the competitiveness of Australia’s investment climate.  This was confirmed by the Industry Commission, which agreed that, in most circumstances, it would be undesirable for Australia to be out of step with the periods of protection offered to most other developed countries.  To do otherwise would send a highly visible and particularly strong negative signal about the Australian climate for innovation and research and development.

 

Therefore on balance given the importance of an extension of term scheme to the pharmaceutical industry and to consumers who will have improved access to new innovative drugs because of increased investment in research and development, it is preferred that an extension of term scheme, with spring-boarding at any time after the extension is granted, as per sub-option 2C be implemented.

 

For the reasons set out above, this scheme will apply to all patents with a standard 20 year term as this would optimise industry activity and employment in Australia, and also maximise the returns to research based companies in Australia for investment.

 

 

8.         Implementation and review

 

The Patents Act 1990 is to be amended to provide an extension of term scheme for pharmaceutical patents with the following features:

·       extensions of up to five years for standard patents in relation to a pharmaceutical substance that is the subject of the first registration as a therapeutic good on the Therapeutic Goods Act 1989 ;

·       extensions being in relation to product claims for substances and for product by process claims when produced by recombinant DNA technology;

·       exclusive rights during extensions limited to the use of the substances for therapeutic purposes in humans;

·       allowing producers of generic drugs to engage in spring-boarding only after the extension is granted; and

·       to be applied to all standard 20 year patents, as well as to patents granted on applications made on or after the commencement of the scheme.

 



The patents regime is a key part of Australia’s long term policy environment for pharmaceuticals.  Accordingly, an evaluation with regard to the appropriateness of the extension of term scheme would need to be undertaken no earlier than five years from the start of the first extended term.  Broadly, such an evaluation would need to assess:

·       whether the proposal continues to provide a patent term in line with international norms and relevant international agreements; and

·       whether the patent regime continues to be a key factor in encouraging pharmaceutical investment in Australia.

 

Efficiency and effectiveness should not be evaluated until after 10 years, to enable the collection of data about the operation of the new scheme and the pattern of pharmaceutical investment.  Broadly, this would assess:

·       whether the scheme has been effective in encouraging investment in Australia; and

·       the extent to which administration of the extension of term scheme has been streamlined.

 

 

 

2.         REGULATORY REGIME FOR PATENT ATTORNEY PROFESSION

 

 

A         PROBLEM IDENTIFICATION/REGULATORY OBJECTIVE

 

a           Problem Identification

 

1.          The existing regulation confers benefits on the patent attorney profession which could result in their charges being higher than if market forces prevailed.

 

b          Objective

 

2.         The objective of the proposed initiative is to increase competition, and therefore put downward pressure on the prices charged by the profession while maintaining existing quality.

 

c          Background



3.         Intellectual property is an area where Governments in the western world have intervened for centuries with the primary aim of promoting technological innovation by protecting inventions.  Intellectual property protection is a major concern of modern governments worldwide in the context of both economic and trade policies.  While it is not possible to accurately calculate its worth, in 1994, the BIE indicated that world trade in intellectual property was of the order of $US300 billion per annum.

 

4.         In Australia separate colonial acts to protect inventions were in force before Federation. In the early years following federation, the Commonwealth introduced separate Acts to cover patents, trade marks and designs.  The regulation of the patent attorney profession is an aspect of the wider system for the protection of intellectual property, these acts inter alia regulate who may act for gain in preparing documents and conducting proceedings for the purposes of the Acts.  The matter under review, viz ., the regulatory regime for patent attorneys is an important element of the overall protective system; a quality profession is integral to an efficient protective system.  Similar to the case in a number of professions in Australia and other countries, regulation of this profession is aimed primarily at maintaining quality

 

5.         The proposed Government action is in response to a report from a committee which was established to examine the regulatory regime for patent attorneys in the context of the national competition policy principles.  The proposals will modify the existing system, by widening the qualifications for entry to and registration of the profession and by devolving examination processes to the tertiary education sector.  It will maintain some regulation to ensure that the profession engaged in advising on and participating in the systems relating to patents, trade marks and designs continues to be of good quality while freeing up entry into that profession.

 

6.         In 1995-96, 21,509 patent applications, 34,166 trademarks applications and 4,094 designs applications were lodged in Australia.  Approximately one third of patent applications emanated from overseas.  Furthermore, about 60 per cent of patents were lodged by attorneys compared to about 40 per cent which were self filed.

 

B         ALTERNATIVES



7.         There are three major options open to the Government in considering the recommendations in the report from the Committee established to report on the regulatory regime for patent attorneys:

(1)        Complete deregulation

(2)        Partial deregulation

·       improved education

·       certification

·       professional indemnity insurance

·       self regulation

·       negative listing

·       proposed response

(3)        Maintenance of the present system



 

C         IMPACT ANALYSIS

 

a          Impact group identification

 

8.         The groups affected and the likely impact on them are as follows:

·       patent attorneys and lawyers— would face increasing competition under deregulation, which should force their charges downward, but could result in a lowering of quality,

·       other practitioners—lawyers and other service providers in the intellectual property system such as trainees and persons in the corporate sector would be able to provide increased services under deregulation;

·       users of services— Australian users, including SMEs, could face lower charges, but may also increase their own risk because their rights may not be fully secured.

·       patent office —whose costs may increase if deregulation leads to poorly prepared applications.

 

Option 1

 

9.         Under option 1 there would be no restriction or limitation on who may perform any tasks associated with preparing and managing applications for seeking the granting of patents and the obtaining of registrations in respect of trade marks and designs.  At present the major barriers to entry are the requirement to have prior technical qualifications, pass examinable subjects set by the Patent Attorney Professional Standards Board, and to serve for a period as a technical assistant to a registered patent attorney.  If these barriers were eliminated, competitors could come initially from sources already close to the profession, viz ., solicitors, technical assistants in patent attorney firms and persons employed in corporate patent departments.  Over time other professions such as accountants and financial planners may find it attractive to enter, although because of the technical nature of patenting work, entry of new professions would be more likely in trademarks and designs.

 

10.       A serious diminution in the quality of the profession in Australia would leave Australian users and developers of technology in a disadvantageous position compared with their counterparts in countries which are major trading partners.  Australia's income from abroad and in some cases the viability of Australian firms may be threatened, because unqualified persons are more likely to make mistakes, sometimes resulting in the loss of protection for potentially valuable Australian intellectual property.  Overseas firms may also question the reliability of the intellectual property system with detrimental effects on Australia's ability to import the latest technological developments, the use of the latest and best technologies is fundamental to Australia's development.

 

11.       There are also aspects of market failure in the relationship between the profession and its clients not dissimilar from other cases where regulation is deemed necessary.  There is a marked disparity in knowledge of users and the profession.  The risks for the client are significant as there is no going back once a patent application is lodged.  The information is then on the public register and if the specification is wrong then the client loses all protection with no chance to recover rights through the intellectual property system.  There are also limited sources of appropriate insurance available to the client and redress is costly and uncertain.  In some cases the intellectual property may be the firm's competitive advantage.

 

12.       Furthermore, it is important that our major trading partners have confidence in the Australian system.  Western nations on whom Australia depends for the inflow of new technologies have themselves highly regulated regimes for patent attorneys.  Asian countries with the encouragement of international bodies such as the International Federation of Patent Attorneys (FICPI) increasingly look to Australia as the role model and Australia is also exporting educational services in the patent field to Asian countries.

 

13.       It could be argued that there would be a net saving in the cost of administering the intellectual property system from complete deregulation.  AIPO estimate that the registration of patent attorneys is cross subsidised from other AIPO sources to an amount of about $70,000 per year.  This saving would be partly offset if the quality of applications to AIPO fell as the cost of processing application would rise. There could also be significant cost to the community arising from uncertainty and increased legal actions where the validity of the rights come into doubt.

 

14.       On the question of cost it is significant that while users of the protective system argue that SMEs are put off by the high cost, they recognise that there is a trade-off and that the potential costs from an incompetent profession are enormously high.  In this regard the committee established to examine the regulatory regime concluded: 'Most data show that Australia is competitive in terms of its fees, both public and private, in international terms.'

 

15.       As pointed out above opening up the system could exert downward pressure on prices, although it is not possible to quantify this; the spread of services that patent attorneys deliver is disparate and their market diffuse.  In addition, it does not necessarily follow that the prices charged to Australian inventors for such services in Australia would decrease.  At present the prices charged to Australian clients are similar to those to overseas firms taking action to protect their products on the Australian market.  With complete deregulation it could be expected that overseas firms, aware of the substantial risks in these areas would deal with the established profession.  The established profession may leave the Australian business particularly the SME section which is less aware of the risks in protecting property rights to new entrants who would need to charge full cost; heavy overheads can be involved in preparing new applications as opposed to overseas initiated work which may build on already prepared product specifications.  The quality of the profession could also decrease although at the same time users would face increased choice .

 

16.       The balance between benefits and cost is not clear and users certainly see a trade off between the price and quality.  They would like to see lower prices but recognise that this could mean a lessening of quality.  They are fearful of a drop in quality because the nature of work in patenting is such that mistakes are by and large irrecoverable.  It is considered that the potential risk to the quality of the profession is so high that the option of complete deregulation is unacceptable.  This position is influenced by the fact that the people who face the greatest risk are SMEs.

 

Option 2



17.       There are many sub options available under option 2 including adoption of the committee's recommendations.  By opening up the profession there should be minor cost savings to the using industries although for the reasons outlined above it does not follow that the full effect would be passed on to Australian users.  On the downside the risks of diminishing quality in the profession increase with deregulation.

 

18.       Currently the Patent, Trade Marks and Designs Acts stipulate that certain matters relating to patents can only be processed for gain by a registered patent attorney and certain matters relating to trade marks and designs by a lawyer or a patent attorney.  In addition patent attorneys are required to be registered with the Commissioner for Patents after meeting a set of criteria.

 

19.       There are other ways that quality could be preserved and these are discussed below.

 

Improved education

 

20.       Improved education for Australian industry concerning the risks of not safeguarding intellectual property would work towards encouraging the use of properly qualified practitioners which should maintain quality in the profession.  The Australian Industrial Property Organisation (AIPO) is already stepping up its promotional activity and this overall program will include the risk aspect.  AIPO research shows that both large Australian and international companies have a good understanding of the need for and processes involved in intellectual property protection, that sole inventors recognise the need but do not understand well the processes, and, that SMEs understand neither the need nor the processes.  The Institute of Patent Attorneys also conducts promotional work on behalf of the profession.  The shortcomings in this approach are that the target market particularly that made up by SMEs is quite diffuse and the effectiveness of promotion is difficult to monitor.

 

Certification

 

21.       A listing or certification scheme could be introduced which is not linked to a requirement to meet specified standards.  It is difficult to see how such a listing scheme would have the desired effect of maintaining quality, although an effective information dissemination scheme may overcome this deficiency.  Furthermore, it is difficult to see savings.  Presently the Australian Industrial Property Organisation (AIPO) charges fees which largely offset its costs and its cost are not substantially increased by the checking against the standards.  AIPO would need to charge even if the listing had no standards requirements.

 

Professional Indemnity Insurance

 

22.       Users could be protected by a requirement that all persons operating in the profession take out professional indemnity insurance.  To the extent that the profession does not already take out such insurance this would involve costs to users.  Monitoring such a requirement would be feasible only where a listing scheme is in operation.  It may restrict new entrants as it may be difficult for new entrants to obtain insurance because they would not be able to demonstrate past performance  It could also effectively hand over the regulation to the insurance industry.

 

Self Regulation

 

23.       Industry self regulation could be used to maintain quality in the profession.  This would involve a system of registration administered by the profession.  The issue here however is whether this would lead to any substantive opening up of the profession.  The profession is small, consisting of about 60 firms employing 250 registered patent attorneys.  Furthermore the 10 largest firms employ about 60 per cent of all registered attorneys.  It is considered that the profession is too small for effective self regulation that it could be used to entrench the establishment and that better results would be achieved by leaving registration in the hands of AIPO.

 

Negative Listing

 

24.       Negative listing where patent attorneys are not prior screened but are prohibited from practising where they caused some offence could be utilised.  Malpractice or incompetency in intellectual property matters are usually not manifest for quite some time after the service is rendered.  In addition the setting of benchmarks against which the malpractice or incompetency is measured is difficult; enforcement is even more difficult and the cost falls to the administering agency.  There would also be a need for an appeals mechanism which would add to costs.

 



Response to Review

 

25.       The review committee has recommended a number of changes to the regulatory regime It is proposed to implement the thrust of the committee's recommendations with two broad exception.

 

26.       The committee recommends deregulation in the case of trade marks and designs, so that any person be allowed to lodge trade marks and designs applications.  The basis of the recommendation is that such applications are more simple and less technical than in the case of patents.  It also recommends that only qualified persons can carry the title of 'trade marks attorney'.  It is proposed to adopt this recommendation.  However, the entry and qualifications for trade marks will be made less rigorous than is recommended by the committee.  This should encourage new practitioners including entrants from other professions such as accountants and financial planners, increase the level of competition amongst the profession and put downward pressure on their charges with consequent benefits to users.

 

27.       The review committee also recommended a new structure of the existing Patent Attorney Professional Standards Board (PAPSB) together with two new committees dealing with education and discipline respectively.  This is seen as overly bureaucratic and the same result ,at lower cost can be achieved by reconstituting and revamping the existing PAPSB and in particular to have membership from the legal profession and the tertiary education sector.  The intention is to move the role of the board to accreditation with universities taking over the education role.

 

Option 3

 

28.       The review committee produced no evidence that the existing regime was leading to illegal price agreements.  It stated that the profession's code of ethics appears to be consistent with the Trade Practices Act, in permitting open and competitive advertising by patent attorneys.  It also concluded that there was a greater degree of competition in the market for trade marks and designs services than in the market for patent services.

 

29.       There are some aspects of the administration of the present regulatory system which are not conducive to freeing up entry to the profession.  There is a need to widen the membership of the PAPSB to include members from the legal profession and the tertiary education sector.  There is a need to widen the perquisite technical qualification.  There is a need to devolve the examination process from Government and the profession to the tertiary education sector and their is a need to examine the disciplinary provisions.  Finally there is a need to widen the experience requirement.  For all these reasons to continue the existing regime is considered an unsatisfactory option.

 

D         OTHER

 

Consultation

 

30.       The proposals before Government follow widespread consultation. In June 1996 the Minister released a report entitled ' Review of the Regulatory Regime for Patent Attorneys'. This report was based on comprehensive consultation. Submissions were called for and received from the profession, users and educational institutions. A working draft of the report was widely disseminated and discussed at seminars held in Melbourne, Sydney, Adelaide, Perth and Brisbane.

 

31.       At the time of release of the report general a seminar was held in the Melbourne and following that submissions were once again invited from interested parties.  In the preparation of the Government's response to the review report, further consultations were held with key organisations such as the Law Council of Australia, the Institute of Patent Attorneys of Australia, the International Federation of Industrial Property Attorneys (Australian Section) the Australian Manufacturers' Patents, Industrial Design, Copyright and Trade Mark Association and universities known to have an interest in the area.

 

E         Implementation and Review

 

32.       The regulatory regime should be examined again in 2001 to ascertain whether regulation is justified and if so self regulation could apply.



NOTES ON CLAUSES

 

Clause 1 - Short title

 

1.         Provides for the Act to be cited as the Intellectual Property Laws Amendment Act 1997 .

 

Clause 2 - Commencement

 

2.         Provides that Schedules 1 and 2 of the Act shall commence on a day to be fixed by proclamation or on the first day after the period of six months from the day it receives Royal Assent.  Schedule 3 of the Act is to commence on the day the Act receives Royal Assent.

 

Clause 3 - Schedule(s)

 

3.         This clause provides that each of the Acts specified in a Schedule shall be amended or repealed as set out in the provisions contained in the Schedule and any item in a Schedule has the effect in accordance to those provisions.

 

 

SCHEDULE 1 - EXTENSION OF PHARMACEUTICAL PATENTS

 

 

Patents Act 1990

 

Item 1 - Section 3

 

4.         Provides for a definition of the expression “Australian Register of Therapeutic Goods” to be included in the dictionary in Schedule 1 of the Patents Act 1990 .

 

Item 2 - Before section 69

 

5.         This item provides for the formation of two divisions in “Part 3 - Extension of Term” of Chapter 6 of the Patents Act 1990.   Division 1 of this part provides for the extension of term of petty patents.

 

Item 3 - Division 2 - Standard patents relating to pharmaceutical substances

 

6.         This item introduces Division 2 of Part 3 of Chapter 6 which provides for the extension of term for standard patents relating to pharmaceutical substances.  The item introduces sections 70 to 79A.

 

7.         Section 70 sets out the substantive conditions that must be satisfied for a patent to be eligible for an extension of term.  Extensions of term will be available only for patents containing claims to pharmaceutical substances per se or claims to pharmaceutical substances when produced by recombinant DNA technology.  Paragraph 70(2)(a) requires that one or more pharmaceutical substances per se must be both in substance disclosed in the complete specification and in substance fall within the scope of the claim or claims of that specification.  Paragraph 70(2)(b) requires that one or more pharmaceutical substances when produced by a process that involves the use of recombinant DNA technology must be both in substance disclosed in the complete specification and in substance fall within the scope of the claim or claims of that specification. 

 

8.         A “pharmaceutical substance” is defined in Schedule 1 of the Patents Act 1990 and may comprise combinations of active ingredients or single active ingredients.

 

9.         The extension of term provisions will be available for patents that include claims to pharmaceutical substances per se (provided that the other criteria are met).  These claims to pharmaceutical substances per se would usually be restricted to new and inventive substances.  Patents that claim pharmaceutical substances when produced by a particular process (product by process claims) will not be eligible unless that process involves the use of recombinant DNA technology.  Claims which limit the use of a known substance to a particular environment, for example claims to pharmaceutical substances when used in a new and inventive method of treatment, are not considered to be claims to pharmaceutical substances per se.

 

10.       An extension of term will not be available for claims to new processes of making pharmaceutical substances or new methods of using pharmaceutical substances where the substances themselves are already known.

 

11.       Subsection 70(3) provides that goods containing or comprising at least one of the substances must be included in the Australian Register of Therapeutic Goods and that the first regulatory approval date must be at least 5 years from the date of the patent.

 

12.       Subsection 70(4) provides that only one extension of term is available for each patent. 

 

13.       Subsections 70(5) and 70(6) define the term “first regulatory approval date”.  For pharmaceutical substances that had not received marketing approval, or approval to be imported into Australia for general marketing, prior to being included in the Australian Register of Therapeutic Goods the first regulatory approval date is the date of commencement of the first inclusion in the Australian Register of Therapeutic Goods.  For pharmaceutical substances that had already received marketing approval, or approval to import into Australia for general marketing, prior to inclusion in the Australian Register of Therapeutic Goods the first regulatory approval date is the date of the first such approval. 

 

14.       Section 71 sets out the requirements of the form and timing of the application.  The extension of time provision under section 223 of the Patents Act 1990 will apply to all acts required to be done under the extension of patent term scheme provided that the relevant criteria are satisfied .

 

15.       Section 72 requires that the Commissioner publish a notice in the Official Journal that an application has been made and is open to public inspection.  These documents are documents filed in relation to the patent and are open to public inspection according to the provisions of paragraph 55(2)(a) of the Patents Act 1990 .

 

16.       Section 73 allows for an application to be withdrawn by a patentee and publication by the Commissioner of a notice of that withdrawal.

 

17.       Section 74 provides that the Commissioner must accept the application if the Commissioner is satisfied that the requirements of section 70 and 71 are satisfied.  If the Commissioner is not so satisfied the Commissioner must refuse the application.  The Commissioner must notify the applicant of the decision and publish a notice in the Official Journal

 

18.       Section 75 provides a mechanism whereby the grant of an extension of term may be opposed.  There is no standing requirement for the opponent.  The grant may be opposed on the ground that the requirements of sections 70 and/or 71 are not satisfied.  An appeal against a decision of the Commissioner under this section is to the Federal Court.

 

19.       Section 76 requires that the Commissioner must grant an extension of term if there is no opposition or if the opposition does not succeed.  The Commissioner is required to publish a notice of the grant.

 

20.       Section 77 sets out how the length of the extension of term is to be calculated.  The maximum length of the extension will be 5 years.  The length of the extension is equal to the period between the date of the patent and the date of the first regulatory approval less 5 years.  For example, where the period between those two dates is 5 years or less, a patent will not be eligible for an extension of term, while a period of 10 years or more would allow a full 5 year extension.

 

21.       Section 78 sets out how the exclusive rights of the patentee are limited if an extension is granted.  Section 13 of the Patents Act 1990 provides that subject to the Act a patent gives the patentee the exclusive rights, during the term of the patent, to exploit the invention.  “Exploit” is defined in Schedule 1 to the Patents Act 1990 .  Up to the date on which the extension of term is granted the patentee has the full exclusive rights to exploit the invention but after the extension is granted the exclusive rights enjoyed by the patentee are limited.

 

22.       Subsection 78(1) sets out what activities do not infringe the patent during the extended term.  The effect of these provisions is that the exclusive rights of the patentee are limited to exploiting the invention as defined in claims to a pharmaceutical substance per se , or exploiting claims to a pharmaceutical substance when produced by a process that involves the use of recombinant DNA technology, for therapeutic use.  The term “therapeutic use” is defined in Schedule 1 to the Patents Act 1990 and is limited to therapeutic use in relation to humans.  The other forms of the invention referred to in paragraph 78(1)(b) could include, for example, intermediate compounds with no pharmaceutical activity or methods of treatment using known substances claimed in the same patent as the pharmaceutical substances.  The other forms of the invention could be claimed in the same claims as the pharmaceutical substances or could be the subject of different claims.  The terminology “form of an invention” is used in subsection 43(3) of the Patents Act 1990 in respect of priority dates .

 

23.       Subsection 78(2) sets out the so-called “spring-boarding” provisions whereby from the date of the extension being granted third parties will be able to undertake otherwise infringing activities solely for the purposes of meeting pre-marketing regulatory requirements for therapeutic use in humans.  This has the effect of enabling a generic manufacturer to produce a generic pharmaceutical formulation containing the patented pharmaceutical substance solely for the purpose of obtaining regulatory approval while the patent is still in force.  It therefore prevents a patentee from ending up with a further de facto extension of term which would occur if a generic producer could not commence any work on the patented pharmaceutical substance to meet these requirements until the extended term expired.

 

24.       Section 79 provides for the rights of a patentee if the extension is granted after the patent expires.  In these circumstances the patentee has the same rights as if the extension had been granted at the expiration of the unextended term of the patent.

 

25.       Section 79A requires that the Commissioner must not make any decision under the Division without the leave of the court if relevant proceedings are pending (“relevant proceedings” is defined in Schedule 1 to the Patents Act 1990 ).

 

Item 4 - Section 83

 

26.       This item replaces Section 83 which sets out the term of patents of addition.  The general rule is that a patent of addition remains in force for so long as the patent for the main invention remains in force. 

 

27.       The term of a patent of addition may be extended even though the patent for the main invention is not extended.  A patent of addition could be granted for a pharmaceutical substance in situations where the substance is not patentable as a separate invention because it does not involve an inventive step in respect of the disclosure of the patent for the main invention.  If a pharmaceutical substance registered on the Australian Register of Therapeutic Goods is only in substance disclosed in the patent of addition and not the patent for the main invention it will be only the patent of addition which is eligible to have its term extended.  In this case the patent of addition will become an independent patent after the unextended term of the patent for the main invention.

 

28.       If the patent for the main invention is extended and the term for the patent of addition is not extended the general rule for the term of a patent of addition is not followed and the term of the patent of addition expires at the end of the unextended term of the main patent.

 

Item 5 - Paragraph 224(1)(a)

 

29.       Item 5 provides for an application to be made to the Administrative Appeals Tribunal for a review of a decision of the Commissioner under subsection 74(3).

 

Item 6 - Schedule 1

 

30.       Item 6 provides for the inclusion of the definition of the term “Australian Register of Therapeutic Goods” in Schedule 1 of the Patents Act 1990 .

 

Item 7 - Schedule 1 (definition of patent of addition)

 

31.       Item 7 makes it clear a patent of addition that is also an independent patent because its term has been extended under section 83, is still considered to be a “patent of addition” for the purposes of the other provisions of the Patents Act 1990.

 

 



Item 8 - Application of amendments

 

32.       Item 8 provides that the extension of term provisions apply to standard 20 year patents that have already been granted prior to the commencement of the new extension of term scheme (including “transitional standard patents” defined in subsection 3(1) of the Patents (World Trade Organization Amendments) Act 1994) as well as patent applications yet to be granted and new patent applications.

 

 

 

SCHEDULE 2 - PATENT ATTORNEYS AND TRADE MARKS ATTORNEYS

 

Copyright Act 1968

 

Item 1- Subsection 43(2)

 

33.       This item remakes the existing section to include registered trade marks attorneys along with legal practitioners and registered patent attorneys as persons who will not infringe fair dealing provisions of copyrighted material where the material is used for the purpose of giving professional advice.

 

Item 2 -At the end of paragraph 104(a) 

Item 3 - Paragraph 104(b) and (c)

 

34.       Items 2 and 3 insert into the section the new class of practitioner, a registered trade marks attorney and provide them with the same rights as legal practitioners and registered patent attorneys in the use of copyrighted material for the purposes of seeking or giving professional advice.

 

Designs Act 1906

 

Item 4 - Subsection 4(1)

Item 5 - Subsection 4(1)

 

35.       Items 4 and 5 insert into the Designs Act 1906 definitions for patent attorney and trade marks attorney by defining them as persons registered in accordance the Patents Act 1990 or the Trade Marks Act 1995 , respectively.

 

Item 6 - Section 32G

 

36.       Includes trade marks attorneys along with patent attorneys and legal practitioners as persons not liable under section 32C relating to an application for relief from unjustified threats for acts done in a professional capacity.



Item 7 - Section 44

Item 8 - Section 44

 

37.       Amends existing section 44 which provided that the Registrar of Designs may recognise agents to allow any person a right to act for any other person in designs matters before the Designs Office.

 

Item 9 - After section 44

 

38.       The new section provides that regulation making power to allow for the granting of the same powers of lien over documents and property in matters relating to designs for patent and trade marks attorneys as are given to solicitors.

 

Patents Act 1990

 

Item 10 - Section 3 (after the entry relating to “Deputy Commissioner”)

Item 11- Section 3 (after the entry relating to “prior art information”)

Item 12 - Section 3 (after the entry relating to “registered”)

 

39.       These items insert the new terms “Designated Manager”, “Professional Standards Board” and “registered patent attorney” into the listing of definitions for the Patents Act 1990 .

 

Item 13 - Section 198

 

40.       This item repeals existing section 198 which provided for the register of patent attorneys and the registration of patent attorneys and substitute a new section. The new section 198 provides that the Register of Patent Attorneys is to be kept by the Designated Manager and allows for the register to be kept wholly or partly by the use of computers. The item provides that the designated manager must register a person who is an ordinary resident of Australia which is defined, holds qualifications specified in or ascertained by the regulations, has been employed for a prescribed time, is of good fame and integrity, and has not been convicted of a prescribed offence in the past 5 years or is imprisoned for an offence. Registration is by entering the name of qualified persons on the Register of Patent Attorneys. The amending provision will enable the making of regulations for the Professional Standards Board to assess qualifications offered by tertiary institutions as meeting both the technical and professional qualifications required for registration.

 

Item 14 - Section 200

 

41.       Changes the reference to “patent attorneys” to “registered patent attorneys” to ensure consistent terminology.

 

Item 15 - Section 200(2)

Item 16 - At the end of section 200(2)

 

42.       These items ensures that privilege applies to communications between registered patent attorneys and their clients in intellectual property matters. Item 13A defines intellectual property matters to be matters relating to patents, trade marks and designs or related matters.



Item 17 - After section 200

 

43.       This item defines “Designated Manager” for the purpose of the Act as being the holder or occupier of a Senior Executive Service office specified in writing by the Secretary and the person holding, occupying or performing the duties of the office or position.

 

 

Item 18 - Subsection 201(2)

Item 19 - Subsection 201(4)

 

44.       These items change the partnership arrangements for persons carrying on business as a patent attorney to require only one member of the partnership to be a patent attorney. Where one partner is a registered patent attorney that partnership may described its partnership as a patent attorney partnership.

 

Item 20 - Subsection 201(7)

 

45.       This item repeals the existing subsection and replaces it with new provisions that deem a person or a company to be carrying on a business, practicing or acting as a patent attorney if the person or company does or undertakes on behalf of another person to apply for a patent in Australia or elsewhere, to prepare specifications or other documents for the purposes of the Act or the patent law of another country or gives advice (other than advice of a scientific or technical nature) about the validity or infringement of a patent. The item also authorises a person to undertake those functions in their capacity of an employee for their employers or for related companies in the employers’ group of companies. Related companies are defined with reference to the Corporations Law as being companies where there is a majority ownership in the group of two or more companies. In undertaking such functions for related companies, a member of the group will not commit an offence against subsection (5) which prohibits companies from practicing or holding themselves out as patent attorneys or agents for obtaining patents. The item in no way preclude an applicant from filing or prosecuting their own application.

 

Item 21 - After section 202

Item 22 - Section 204

 

46.       These item provides that only registered patent attorney members of a partnership have responsibility for the preparation of specifications or documents relating to the amendment of a specification. Where amendments are directed by a court under section 105 the restriction does not apply. The time for starting prosecution is 5 years in line with the existing provisions. 

 

Item 23 - Section 213

Item 24 - Section 220

 

47.       These item remove references to “person entitled under the Act to practice as a patent attorney” and “patent attorney” and substitute “registered patent attorney”.



Item 25 - Section 224(1)(b)

 

48.       Repeals the existing provision in respect of appeals to the Administrative Appeals Tribunal against decision not to register a person and inserts an equivalent provision authorising appeals against the decisions of the “Designated Manager” not to register a person.

 

Item 26 - After section 227

 

49.       Inserts a new provision establishing the Professional Standards Board for Patents and Trade Marks Attorneys and giving the Board its functions. The item provides that the Professional Standards Board should undertake such functions as are conferred by the Patents Act 1990 , the Trade Marks Act 1995 and such regulations in accordance with sections 199 (deregistration of patent attorneys) and 228(2)(r) (professional conduct of patent attorneys) of the Patents Act 1990, and 228B (deregistration of trade marks attorneys ) and 231(2)(ha) (professional conduct of trade marks attorneys) of the Trade Marks Act 1995. In addition the Professional Standards Board is charged with doing anything incidental to or conducive to the performance of any of the above functions.

 

50.       The regulations made under the Patents Act 1990 may include provisions for the constitution and membership of the Professional Standards Board, the manner in which the Board performs its functions and the procedures to be followed by the Board in respect to convening meetings, quorums, presiding members and the way in which decisions are made. Members are to be paid remuneration determined by the Remuneration Tribunal or in the absence of a determination, prescribed remuneration and allowances are to be prescribed, but  the provisions on remuneration and allowances are subject to the effect of the Remuneration Tribunals Act 1973.

 

Item 27 - Schedule 1

Item 28 - Schedule 1

Item 29 - Schedule 1

Item 30 - Schedule 1

 

51.       The items insert into the definitions contained in Schedule 1 the meanings of “Designated Manager” by reference to section 200A, “Professional Standards Board” by reference to section 227A, remakes the definition of “registered” so that it applies only to patents and inserts a new definition of “registered patent attorneys”.

 

Item 31 - Transitional - Register of Patent Attorneys

Item 32 - Transitional - registered patent attorneys

 

52.       The items ensure that the existing Register of Patent Attorneys remains in force and that existing registrations of patent attorneys are unaffected by the changes made to the Patents Act 1990 .



Trade Marks Act 1995

 

Item 33 - Section 6

 

53.       The item inserts into the definitions in Schedule 6 “registered trade marks attorney” as a person registered under the Act.

 

Item 34 - Subsection 129(6)

Item 35 - Subsection 129(6) (note)

 

54.       The items add to the existing provision a registered trade marks attorney so that they have the same exemption from liability for acts done in a professional capacity on behalf of a client as is granted to lawyers and patent attorneys.

 

Item 36 - Section 155

Item 37 - Section 155 (note 4)

 

55.       The items repeal the existing provisions with the exception of note 4 which is moved to the end of subsection 156(2). The repeal of the section will have the effect of allowing any person to practice on behalf of a trade marks applicant before the Trade Marks Office in respect of trade marks matters. Note 4 is relocated as it specifies provisions of the repealed Trade Marks Act 1955 relating to trade mark agents which remain in force and the provisions are referred to in paragraph 156(2) of the Act.

 

Item 38 - Subsection 156(1)

 

56.       The subsection is repealed as a consequence of the repeal of section 155 to ensure that all persons have the right to practice on behalf of others in respect of trade marks matters. A new subsection is substituted that prohibits people from describing themselves as trade marks attorneys unless they are registered patent or trade marks attorneys.  Thirty penalty points are prescribed for an offence against the provision and notes are added explaining the penalty points and referring the reader to the definitions of registered trade marks attorney and patent attorney.

 

Item 39 - Paragraph 156(2)

Item 40 - Subsection 156(2) (note 2)

 

57.       The items ensure that a person must not hold themselves out to be a trade marks agent unless they are a registered trade marks attorney, a patent attorney or a lawyer and inserts “registered trade marks attorney” into note 2 which refers the reader to the definition for the meaning of the relevant terms.

 

Item 41 - Subsection 156(2) (note 3)

 

58.       This item removes note 3 which refers to note 4 of the repealed section 155 as a consequence of the repeal of that section and the relocation of note 4 to subsection 156(2). 



Item 42 - Subsection 156(5)

 

59.       The item repeals subsection 156(5) as a consequence of the repeal of section 155 removing restrictions on who can practice in trade marks.

 

Item 43 - Section 212

 

60.       The item repeals the section which restricts who could take action on behalf of another person to obtain trade marks registration. A new section is inserted that allows any person to act as an agent for any other person in trade mark matters before the Trade Marks Office.

 

Item 44 - After section 228

 

61.       The item inserts two new sections 228A and 228B providing for the registration of trade marks attorneys and the removal of a trade marks attorney from the Register. Section 228A provides that the Register of Trade Marks Attorneys is to be kept by the Designated Manager and allows for the Register to be kept wholly or partly by the use of computers. The item provides that the Designated Manager must register a person who holds qualifications specified or ascertained in accordance with the regulations, is of good fame and integrity and has not been convicted of a prescribed offence in the past 5 years or is imprisoned for a prescribed offence. Registration is effected by placing the person’s name on the Register of Trade Marks Attorneys. The item also provides that a person may apply to the Administrative Appeals Tribunal for the review of a decision by the Designated Manager not to register a person as a Trade Marks Attorney. The amending provision will enable the making of regulations for the Professional Standards Board to assess qualifications offered by relevant tertiary institutions as meeting the requirements for registration. Section 228B provides for the removal of the name of a person registered as a trade marks attorney in the prescribed manner and on the prescribed grounds.

 

Item 45 - Section 229

 

62.       The item repeals the existing section which specifies the right of practice for patent attorneys as all persons now have those rights and substitutes a section providing rights of privilege for communication between registered trade marks attorneys and their clients. The new section affords registered trade marks attorneys the same privileges in respect of communications in intellectual property matters as exists between solicitors and their clients. The section provides regulation making power for the granting of powers of lien for patent and trade marks attorneys as are given to solicitors. Intellectual property matters are defined as matters relating to patents, trade marks or designs or any related matters.

 

Item 46 - After paragraph 231(2)(h)

 

63.       The item inserts provisions allowing for the making of regulations for matters relating to discipline and complaints against registered trade marks attorneys including the provision for the making and hearing of complaints about professional conduct, the imposing of penalties on registered trade marks attorneys, the summonsing of witnesses, the gathering of both written and oral evidence, the administering of oaths to witnesses and the production of documentation or articles in the course of the conduct of the complaint.

 



SCHEDULE 3 - MISCELLANEOUS AMENDMENTS OF THE PATENTS ACT 1990

 

Patents Act 1990

 

Item 1 - Subparagraph 6(c)(ii)

 

64.       This item repeals subparagraph 6(c)(ii) of the Patents Act 1990 . This removes the requirement for a patent specification to include the date on which the microorganism deposit was made.

 

Item 2 - Section 185

 

65.       This item repeals section 185 of the Patents Act 1990 and introduces a new section to allow an employee of the Patent Office to render higher levels of assistance to the public by removing the prohibition on preparing or helping to prepare a document which is an approved form other than a specification. It also provides an exemption to the restrictions on Patent Office employees preparing or helping to prepare a specification or a document relating to a specification when the employee is the inventor in respect of the specification.

 

66.       The item also removes the administratively cumbersome requirement of a written direction of the Commissioner or an order of the court to allow a Patent Office employee to search the records of the Patent Office in an official capacity.

 

Item 3 - Subsection 227(5)

 

67.       Provides for a procedure that enables the Commissioner of Patents to lapse an application where the full fee has not been paid in respect of the filing of a patent request and the Commissioner has given the applicant due notice of the fee to be paid and provided a certain time in which the fee is to be paid.  The time for paying a fee in respect of a patent request will be extendible under the provisions of section 223 of the Patents Act 1990 if the relevant criteria are satisfied .

 

68.       The item also provides a procedure whereby if a full fee is not paid in respect of the filing of a document other than a patent request or in respect of the doing of an act by a person other than the Commissioner and the Commissioner has given the applicant due notice of the fee to be paid and provided a certain time in which the fee is to be paid, the document is taken never to have been filed or the act is taken never to have been done.  If an act is taken never to have been done it may be done again within any time limit specified under the Patents Act 1990, or within that time limit as extended under the provisions of section 223 if the relevant criteria are satisfied .

 

Item 4 - Application

 

69.       Provides that the procedure provided for by item 3 is prospective, that is it will apply to documents filed or acts done on or after the commencement date.