Patents Act 1990 and Balancing Competition rights and Interests

The Australian government provides statutory protection for the intellectual property through patents, trademarks, copyrights, registered designs, moral rights, and geographical indications[1]. However, it is evident that the global economy is changing at a faster rate and there have been changes in scope and duration of intellectual property protection. The advances in technology, transport, and communication systems have accelerated cross border movement of goods and services[2]. The 2016 Draft report of the Australian Productivity Commission concerning the intellectual property stipulated that the Intellectual Property (IP) arrangements should balance the interests of rights holders with the users. This paper examines the extent by which the Patent Act of 1990 balances the rights and interests of the rights holders and the users.

The Patent Act of 1990 seemed to have treated the patents as rights that are limited to the national scope. One of the challenges inherent in applying the Patent Act of 1990 can be illustrated by Load and Move Pty Ltd v Container Rotation Systems Pty Ltd [2016][3].

In the above case, the Australian company found itself in a competition with other companies to supply products to foreign clients. In this case, the courts were to determine whether a sale of goods that were manufactured in China to be delivered in Africa by an Australian vendor would lead to exploitation within the patent area. The accused and the defendant contented that the sale was made using an Australian website, constituting a sale within the patented area. In their ruling, the federal judges dismissed the argument by asserting that the contract for the sale will not interfere with the patentee’s exclusive rights to exploit an invention provided the goods never come into the patented area. The judges relied on the ruling in Badische Anilin Und Soda Fabrik (BASF) v Hickson where a similar case arose[4]However, such ruling makes the people to question the credibility and the reliability of the Patent Act of 1990.

The Patent Act of 1990 is limited in creating enough room for incentives, innovation, and investments. Generally, a good intellectual property law should not in any way impede innovation, competition, investment, and the quick access to goods and services[5]. This would interfere with innovation and the development of various commercial activities within the country.

The Patent Act of 1990 also seems to create much room for the second-tier innovation system. There is need to do away with the second-tier innovation system to bring order within the copyright protection.

The Patent Act of 1990 is limited in enhancing creativity, investment, and innovation by the businesses and the individuals[6]. The legislation seems to restrict the access to technologies and limits collaboration between various functions. The other limitation of the current Patent Act is that it limits access to the wide range of quality and valuable goods and services. On the other hand, it is limited by the fact that it reduces compliance and administrative costs linked with the intellectual property laws[7].

The Patent Act of 1990 is also limited in terms of the duration of the commercial exploitation of the intellectual property. The duration of protection affects the research and innovation management. It seems the 1990 Copyright Act set a long term for copyright protection. Very lengthy copyright time may impede innovation, creativity, and access to goods and services[8].

The Patent Act 1990 provides protection in a very easy manner, which provides room for the proliferation of low-quality patents. It would have been better if the law supports the abolishment of innovation patent and increase the degree of invention required to receive a patent[9]. Also, there is need to redesign extensions of term pharmaceutical patents to support the interests of the right holders and the users.

Since the enactment of the Patent Act of 1990, the legislation has worked well for the large rights holders. On the other hand, the small rights holders are facing challenges in adhering to the law and supporting their innovative ideas. Therefore, there is a need to redraft the law to balance the benefits for both the large rights holders without interfering with the rights of the small holders. Already, the courts have provided the pathway on emphasizing on the costs and informal alternatives that would improve the enforcement outcomes and benefit the small right holders[10]. To improve the benefits to the small right holders, there is a need to improve the dispute resolution options to the Federal Circuit Court.

Traditionally, the law is limited in subjecting the commercial transactions involving the intellectual property to competition law[11]. The current competition exemption is outdated and should be repealed to support competition for commercial purposes. There is a need for broad and principle based fair use exception to address the interest of the rights holders and the users. The developments in technology and digital data provide a better platform for reducing online copyright infringement. Therefore, there is no need to increase enforcement methods or penalties in the era of the digital era. 

Finally, the Patent Act of 1990 has not fully supported the multilateral and bilateral trade agreements for intellectual property arrangements. Therefore, the Act seems to constrain the domestic intellectual property policy by making it inflexible[12]. The importers of intellectual property in Australia find it costly to adhere to this Patent Act of 1990[13]. Specifically, there are high increased costs for those seeking patent rights in several jurisdictions.

In conclusion, the Patent Act of 1990 seems to have been overtaken by events. The Act is limited in balancing the competing rights and interests between rights holders and the users. To this effect, the Australian productivity commission has proposed sweeping changes to the Patent Act of 1990. These changes are necessary to protect the trademarks, copyrights, plant varieties and designs in Australia. This body has realized that the intellectual property arrangement does not balance the interest rights of the holders.

Bibliography

“Patent Cloud LLC; Patent Issued for Method and System for Facilitating the Transfer of Intellectual Property.” Biotech Law Weekly, 2012., pp. 1017

“Research and Markets: Intellectual Property in Business Transactions: Protecting the Competitive Advantage.” Business Wire, New York, 2012.

“Research and Markets: Intellectual Property in Business Transactions: Protecting the Competitive Advantage.” Business Wire, New York, 2010.

Badische Anilin Und Soda Fabrik (BASF) v Hickson [1906] AC 419 (‘Badische’). 

Balganesh, Shyamkrishna. “The Pragmatic Incrementalism of Common Law Intellectual Property.” Vanderbilt Law Review, vol. 63, no. 6, 2010., pp. 0_11,1543-1616

Federal Court Rules 2011 (Cth)

Kolb, Daniel F., Joel M. Cohen, and Suzanne E. Wachsstock. “Intellectual Property Antitrust.” International Commercial Litigation, 1996., pp. 8

Load and Move Pty Ltd v Container Rotation Systems Pty Ltd [2016] FCA 843

Patents Act 1990 (Cth)

Paul’s Retail Pty Limited v Lonsdale Australia Limited (2012) 294 ALR 72 at 78-79 [38]-[47]

Posner, Richard A. “Intellectual Property: The Law and Economics Approach.” The Journal of Economic Perspectives, vol. 19, no. 2, 2005., pp. 57-73

PST Energy 7 Shipping LLC v OW Bunker Malta Ltd [2016] 2 WLR 1193

Reilly, Robert F. “Intellectual Property Assets in the Taxpayer Corporation.” Journal of Property Tax Assessment & Administration, vol. 6, no. 2, 2009., pp. 19-441

Robinson, W. K., and David O. Taylor. “RECENT DEVELOPMENTS IN INTELLECTUAL PROPERTY LAW-A 2014 RETROSPECTIVE.” Santa Clara Computer and High – Technology Law Journal, vol. 31, no. 4, 2015., pp. 527-.

Sale of Goods Act 1923 (NSW)

Sunder, Madhavi. “IP^sup 3^.” Stanford law review, vol. 59, no. 2, 2006., pp. 257-

The April 2016 Draft Report:  Intellectual Property, The Australian Productivity

 

 

[1] See The April 2016 Draft Report:  Intellectual Property, The Australian Productivity

[2] “Research and Markets: Intellectual Property in Business Transactions: Protecting the Competitive Advantage.” Business Wire, New York, 2012.

[3] See Load and Move Pty Ltd v Container Rotation Systems Pty Ltd [2016] FCA 843

[4] See Badische Anilin Und Soda Fabrik (BASF) v Hickson [1906] AC 419 (‘Badische’). 

[5] “Research and Markets: Intellectual Property in Business Transactions: Protecting the Competitive Advantage.” Business Wire, New York, 2010.

[6] See Patents Act 1990 (Cth)

[7] Ibid

[8] See Federal Court Rules 2011 (Cth)

[9] Balganesh, Shyamkrishna. “The Pragmatic Incrementalism of Common Law Intellectual Property.” Vanderbilt Law Review, vol. 63, no. 6, 2010., pp. 0_11,1543-1616

[10] PST Energy 7 Shipping LLC v OW Bunker Malta Ltd [2016] 2 WLR 1193

[11] Sale of Goods Act 1923 (NSW)

[12] Kolb, Daniel F., Joel M. Cohen, and Suzanne E. Wachsstock. “Intellectual Property Antitrust.” International Commercial Litigation, 1996., pp. 8

[13] “Patent Cloud LLC; Patent Issued for Method and System for Facilitating the Transfer of Intellectual Property.” Biotech Law Weekly, 2012., pp. 1017