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Intellectual Property Arrangements

Inquiry report

This report was sent to Government on 23 September 2016 and publicly released on 20 December 2016.

The report examines Australia’s Intellectual Property (IP) system in detail, and makes recommendations to improve its operation.

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  • Key points
  • Contents summary
  • Australia's intellectual property (IP) arrangements fall short in many ways and improvement is needed across the spectrum of IP rights.
  • IP arrangements need to ensure that creators and inventors are rewarded for their efforts, but in doing so they must:
    • foster creative endeavour and investment in IP that would not otherwise occur
    • only provide the incentive needed to induce that additional investment or endeavour
    • resist impeding follow–on innovation, competition and access to goods and services.
  • Australia's patent system grants exclusivity too readily, allowing a proliferation of low quality patents, frustrating follow–on innovators and stymieing competition.
    • To raise patent quality, the Australian Government should increase the degree of invention required to receive a patent, abolish the failed innovation patent, reconfigure costly extensions of term for pharmaceutical patents, and better structure patent fees.
  • Copyright is broader in scope and longer in duration than needed — innovative firms, universities and schools, and consumers bear the cost.
    • Introducing a system of user rights, including the (well-established) principles–based fair use exception, would go some way to redress this imbalance.
  • Timely and cost effective access to copyright content is the best way to reduce infringement. The Australian Government should make it easier for users to access legitimate content by:
    • clarifying the law on geoblocking
    • repealing parallel import restrictions on books. New analysis reveals that Australian readers still pay more than those in the UK for a significant share of books.
  • Commercial transactions involving IP rights should be subject to competition law. The current exemption under the Competition and Consumer Act is based on outdated views and should be repealed.
  • While Australia's enforcement system works relatively well, reform is needed to improve access, especially for small– and medium–sized enterprises.
    • Introducing (and resourcing) a specialist IP list within the Federal Circuit Court (akin to the UK model) would provide a timely and low cost option for resolving IP disputes.
  • The absence of an overarching objective, policy framework and reform champion has contributed to Australia losing its way on IP policy.
    • Better governance arrangements are needed for a more coherent and balanced approach to IP policy development and implementation.
  • International commitments substantially constrain Australia's IP policy flexibility.
    • The Australian Government should focus its international IP engagement on reducing transaction costs for parties using IP rights in multiple jurisdictions and encouraging more balanced policy arrangements for patents and copyright.
    • An overdue review of TRIPS  (trade-related aspects of intellectual property rights) by the WTO (World Trade Organization) would be a helpful first step.
  • Reform efforts have more often than not succumbed to misinformation and scare campaigns. Steely resolve will be needed to pursue better balanced IP arrangements.

Background information

Michelle Cross (Media and Publications) 03 9653 2244 / 0403 174 696

This report consists of an overview, 19 chapters and 8 appendixes.

Chapter 1 presents relevant background information and definitions, the broad framework applied in this inquiry, and the basis for government involvement in WR.

Chapters 2 and 3 outline the framework for assessing Australia's IP arrangements and consider how the system is faring overall.

Chapters 4 to 14 examine specific forms of IP rights and options for their reform.

Chapters 15 to 19 examine cross–cutting issues.

Structure of the report

Framework: Chapter 1 About this inquiry, Chapter 2 An analytical framework for assessing the IP system and Chapter 3 How does the system fare? Specific forms of IP rights: Chapter 4 Copyright term and scope, Chapter 5 Copyright use and licensing, Chapter 6 Fair use or fair dealing - what is fair for Australia? Chapter 7 The patent system - getting the fundamentals right, Chapter 8 The innovation patent system, Chapter 9 Business methods patents and software patents, Chapter 10 Pharmaceuticals - getting the right policy prescription, Chapter 11 Registered designs, Chapter 12 Trade marks and geographical indications, Chapter 13 Plant breeder's rights and Chapter 14 Circuit layout rights. Cross-cutting issues: Chapter 15 Intellectual Property rights and competition law, Chapter 16 IP and public institutions, Chapter 17 Intellectual Property's institutional arrangements, Chapter 18 International cooperation in IP and Chapter 19 Compliance and enforcement of IP rights.

Framework

  • Chapter 1 About this inquiry
  • Chapter 2 An analytical framework for assessing the IP system
  • Chapter 3 How does the system fare?

Specific forms of IP rights

  • Chapter 4 Copyright term and scope
  • Chapter 5 Copyright use and licensing
  • Chapter 6 Fair use or fair dealing - what is fair for Australia?
  • Chapter 7 The patent system - getting the fundamentals right
  • Chapter 8 The innovation patent system
  • Chapter 9 Business methods patents and software patents
  • Chapter 10 Pharmaceuticals - getting the right policy prescription
  • Chapter 11 Registered designs
  • Chapter 12 Trade marks and geographical indications
  • Chapter 13 Plant breeder's rights
  • Chapter 14 Circuit layout rights.

Cross-cutting issues

  • Chapter 15 Intellectual Property rights and competition law
  • Chapter 16 IP and public institutions
  • Chapter 17 Intellectual Property's institutional arrangements
  • Chapter 18 International cooperation in IP
  • Chapter 19 Compliance and enforcement of IP rights.

Appendixes

  • Appendix A Conduct of the inquiry
  • Appendix B International Commitments
  • Appendix C The IP-intensity of Australia's trade
  • Appendix D Evidence on patents: social value, additionality and thickets
  • Appendix E Copyright evidence
  • Appendix F Registered rights in Australia: a primer
  • Appendix G Additional material about trade marks and geographical indications
  • Appendix H Economic impacts of recommendations.

Printed copies

Printed copies of this report can be purchased from Canprint Communications.

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