Important Proposed Amendments to Intellectual Property Legislation in Australia

On 28 March 2018 the Intellectual Property Laws Amendment (Productivity Commission Response Part 1 and Other Measures) Bill 2018 (Cth) (Bill) was introduced to the Federal House of Representatives.

The Bill proposes amendments to all intellectual property legislation apart from the Circuit Layouts Act 1989 (Circuit Layouts Act). Changes are proposed in respect of the Copyright Act 1968 (Copyright Act), the Trade Marks Act 1995 (TM Act), the Plant Breeder’s Rights Act 1994 (Plant Breeder’s Rights Act), the Patents Act 1990 (Patents Act), the Designs Act 2003 (Designs Act) and the Olympic Insignia Protection Act 1987 (Olympic Insignia Act).

The Bill is divided into two schedules: the first proposes a series of changes that follow some of the recommendations made by the Productivity Commission in its report on Australia’s Intellectual Property arrangements released on 20 December 2016 and subsequent consideration of the content of that report by government. The second schedule proposes other measures to streamline and align the administration of the Australian IP system.

This e-alert covers some of the more significant proposed amendments.

Parallel importation

The Bill proposes to amend the TM Act to clarify the circumstances in which parallel importation will not infringe a registered trade mark.

If passed, the Bill would insert a section 122A into the TM Act, which would ensure that a parallel import is not a trade mark infringement if the following criteria are established:

1. The goods are similar to the goods covered by the Australian trade mark registration;
2. The goods have been previously put on the market or offered for sale in Australia or any other country; and
3. At the time of use, it was reasonable to assume that the trade mark was applied to, or in relation to, the goods by any of the following parties:
   • the registered owner;
   • an authorised user;
   • a person with a valid permission to use the trade mark by the registered owner or an authorised user;
   • a person with significant influence over the use of the trade mark by the registered owner or an authorised user; or
   • an associated entity of any person mentioned above.

As a consequence of this proposed amendment, section 198A of the Copyright Act will be redundant – and that section is proposed to be repealed.

The intention behind these amendments is to give effect to the principle that the registered owner’s rights are exhausted following the initial application of the trade mark to goods which have been put on the market. Any subsequent use of the trade mark in relation to those goods by another person should not infringe the rights of the registered owner provided there is an appropriate relationship between the trade mark owner and the party putting the goods on the market. Where such a relationship exists, the goods should be considered genuine parallel imports.

While there is already protection for parallel importation in the TM Act, this amendment would provide further protection by closing a loophole that enabled trade mark owners to prevent parallel importers from relying on the parallel importation defence through assignments and other corporate and contractual arrangements (for example, where the owner assigns the trade mark to the Australian distributor, with a requirement for an assignment-back). Further, parallel importers would also be protected where the owner of the trade mark changes between the time that the trade mark is applied to the goods and the time that it is used on the goods in Australia. Additionally, the threshold of the parallel importer’s knowledge would be lower: whereas currently the parallel importer must know, and be able to establish, that the owner applied the mark or consented to its application, if the Bill is passed, the parallel importer will only need to have a reasonable assumption to that effect.

Plant breeder’s rights and unjustified threats

Previously, there were no unjustified threats provisions in the Plant Breeder’s Rights Act, however under the Bill, they are proposed to be inserted into that Act. This addition to that legislation has also included a right to claim additional damages in respect of an unjustified threat.

Additional damages now available in relation to most other unjustified threats

If passed, the Bill would provide for additional damages to be claimed in relation to unjustified threats with respect to not only a plant breeder’s rights, but also in relation to designs, patents and trade marks.

For these Acts, it will become all the more important for proper consideration to be given to the merits of a legal threat before one is made.

However, the position in relation to copyright and circuit layouts remains unchanged, in that additional damages cannot be sought with respect to unjustified threats.

Filing requirements

Currently, there are formal filing requirements that differ across the Designs Act, the Patents Act, the TM Act and the Plant Breeder’s Rights Act. The inconsistencies can make it difficult to comply with the filing requirements. Further, having specific requirements in the legislation limits IP Australia’s flexibility to adopt more efficient methods as they become available.

The changes proposed would make the filing requirements consistent, and empower the Commissioner of Patents and the Registrars of Trade Marks and Designs to determine how evidence can be filed with IP Australia.

Legal personality

Under the TM Act, trade marks cannot be registered to an applicant that does not have a legal personality.

The changes proposed would allow applicants who have filed a trade mark application in the name of an entity without legal personality to amend their application to instead refer to a person with legal personality, provided that person can be identified as having made the application.

Notification requirements

Currently, notification requirements in the Designs Act, the Patents Act, the Plant Breeder’s Rights Act, and the TM Act are not reflective of modern methods of electronic communication, often requiring that written notices be provided to parties.

If passed, the Bill would allow for notification to be by any means of communication, including via electronic methods. Similarly, copies of documents could be provided in electronic form, instead of being physically sent to the applicant.This digitalisation of communication is intended to reflect the electronic nature of modern businesses.

Opposition of trade marks applications & registrations

The Bill proposes to further extend the Registrar’s power to require security for the costs of oppositions, and the Governor-General’s power to make regulations prescribing matters relating to oppositions.

Under the Bill, the scope of these powers will include amendments to trade mark applications after particulars have been published, and trade mark registrations which are inconsistent with international agreements. These amendments are intended to relate to opposition requests made after the commencement of the Bill.

Productivity commission recommendations not in the Bill

The exposure draft of the Intellectual Property Laws Amendment (Productivity Commission Response Part 1 and Other Measures) Bill 2017 provided for the phasing out innovation patents. That provision has not been included in the bill tabled before the House of Representatives on 28 March 2018. It seems at this stage that innovation patents will now continue.

In relation to copyright law reform, the Commission recommended that the Government amend the Copyright Act to make unenforceable any part of an agreement restricting or preventing a use permitted by a copyright exception; permit consumers to circumvent technological protection measures for legitimate uses of copyright material; clarify that circumventing geoblocking technology is not an infringement; repeal import restrictions for books; strengthen the governance and transparency arrangements for collecting societies; implement a Fair Use regime in Australia; and limit liability for the use of orphan works. None of these recommendations has been proposed by the Bill.

Finally, in relation to trade mark law reform, the Commission recommended that amendments be made to the TM Act to expedite the removal of unused trade marks; increase the difficult of registering misleading marks; linking the trade mark and business name registers; and allow the importation of legitimately marked goods. The Bill proposes to deal with the parallel importation recommendations, providing exceptions to infringement in certain circumstances. None of the other recommendations have been proposed by the Bill.

While many of the Productivity Commission’s recommendations have not been addressed by the Bill, the Bill, in its title, purports to be Part 1 of the Response to the Productivity Commission.

This article was written by Ashley Holland, Partner, Eli Fisher, Senior Associate and Jonothan Cottingham-Place, Law Clerk.