Designs

The Explanatory Memo for the Designs Amendment (Advisory Council on Intellectual Property Response) Bill 2020 (Cth) states 

 The objective of the intellectual property (IP) rights system is to support innovation by encouraging investment in research and technology in Australia, and by helping Australian businesses benefit from good ideas. The Australian Government proposes improvements to Australia’s designs legislation to better meet these objectives. 

The current designs system has been in operation since the commencement of the Designs Act 2003 (Designs Act) on 17 June 2004. Concerns have been raised about the effectiveness of the designs system and whether it is meeting its original policy objectives. 

In May 2012, the former Advisory Council on Intellectual Property (ACIP) was asked to investigate the effectiveness of the designs system in stimulating innovation by Australian users and the impact the designs system has on economic growth. As part of its investigations, ACIP released an issues paper in September 2013 to seek views from stakeholders, including users of the designs system. ACIP released an options paper for public consultation in December 2014 and a final report in March 2015 (‘the ACIP report’). 

On 6 May 2016, the Australian Government responded to the ACIP report and agreed to the majority of the recommendations. This Bill gives effect to several ACIP recommendations that were accepted by the Government, as well as making other improvements to the designs system. 

Outline 

The purpose of the Designs Amendment (Advisory Council on Intellectual Property Response) Bill 2020 (the Bill) is to provide more flexibility for designers during the early stages of getting registered design protection, and to make several technical amendments that will simplify and clarify aspects of the designs system. 

The Bill’s proposed amendments to the Designs Act are divided into seven categories, corresponding to the following seven schedules:

• Schedule 1 – Grace period 

• Schedule 2 – Infringement exemption for prior use 

• Schedule 3 – Registration of designs – removal of publication option 

• Schedule 4 – Relief from infringement before registration 

• Schedule 5 – Right of exclusive licensee to bring infringement proceedings 

• Schedule 6 – Formal requirements 

• Schedule 7 – Other amendments 

Schedule 1: Grace period 

Recommendation 12 of the ACIP report was: “ACIP recommends introducing a grace period of six months before the filing date, together with a prior user defence. Applicants who rely on the grace period to protect the validity of their design rights should be required to file a declaration to that effect.” The Government accepted this recommendation, noting that the length of the grace period and the requirement to declare any disclosures would be determined following further stakeholder consultation. 

This Schedule amends the Designs Act to give effect to that recommendation by providing designers a 12-month grace period to apply for design protection after publishing or using their design, helping protect them from losing their rights through inadvertent disclosure. 

Schedule 2: Infringement exemption for prior use 

Recommendation 12 of the ACIP report also included a recommendation to introduce a prior use defence for third parties who start using a published design during the grace period. In accepting Recommendation 12 the Government agreed to introduce a prior use defence along with the grace period. 

This Schedule amends the Designs Act to give effect to the recommendation by introducing an infringement exemption for prior use, which will protect third parties against infringement proceedings if they start using a design before the priority date of the design registration. This aims to balance the rights of designers and those of third parties that start use of a design that has been disclosed during the grace period but not yet registered, or that is created independently. The amendments in this Schedule are modelled on analogous prior user exemption provisions in the Patents Act 1990 (the Patents Act). 

Schedule 3: Registration of designs – removal of publication option 

Recommendation 5 of the ACIP report was: “ACIP recommends removing the option of the publication regime (i.e. without registration) from the designs process.” The Government accepted this recommendation, stating that the amendment to implement this recommendation would be one of a number of changes to streamline IP processes and support small business. Recommendation 9 of the ACIP report was: “ACIP recommends automatic publication at six months after the filing date, with the possibility to request publication earlier if desired, and with an amendment to the innocent infringer defence in subsection 75(2) of the Designs Act.” The Government noted this recommendation, stating that further consultation with stakeholders is required to consider any unintended consequences. This Schedule amends the Designs Act to give effect to these recommendations by streamlining the initial steps for registering a design. The changes allow applicants to effectively delay publication of their design for a prescribed period (to be six months) from the priority date. The seldom used “publication only” option is eliminated. Registration of designs is automatically requested after the expiry of a prescribed period from filing a designs application – currently, an application lapses after the expiry of this period. 

The overall impact will be to reduce the number of deadlines requiring action by applicants while making it simpler for them to delay publication of a new design until they are ready to launch in the market. 

Schedule 4: Relief from infringement before registration 

Recommendation 9 of the ACIP report also included a recommendation to amend the innocent infringer defence in subsection 75(2) of the Designs Act. The Government noted the recommendation, stating that further stakeholder consultation by IP Australia was required to consider any unintended consequences. 

Following further consultation this Schedule amends the Designs Act to give effect to that recommendation. The amendments will correct an anomaly that means relief for “innocent” infringers has not been available when infringement occurs between filing and registration. The amendments will allow courts to provide discretionary relief to innocent infringers in this period. This will reduce the risk to competitors from infringing a design they could not have found on the Register of Designs, because it was not yet published. 

Schedule 5: Right of exclusive licensee to bring infringement proceedings 

Recommendation 18(h) of the ACIP report was: “The Designs Act and/or the Designs Regulations 2004 should be amended to ensure exclusive licensees have the right to bring proceedings for infringement.” The Government accepted the recommendation. 

This Schedule amends the Designs Act to provide exclusive licensees with the legal standing to take infringement action through the courts without needing to rely on the registered design owner. Currently, only a registered owner of a design has standing to commence infringement action. When an exclusive licence is granted, it is often because the registered design owner is foreign based. A foreign based owner may not be strongly motivated to assist the exclusive licensee in pursuing a local alleged infringer due to associated costs or administrative burden. This proposal would ensure exclusive licensees of registered designs are able to enforce the rights that they have paid for, as is the case for patents, trade marks and plant breeder’s rights. (Patents Act 1990 s 120(1); Trade Marks Act 1995 s 26(1); Plant Breeders Right Act 1994 s 54(1)) 

Schedule 6: Formal requirements 

This Schedule amends the Designs Act to streamline the process for updating formal requirements for a design application in line with the current environment of fast-paced technological change. Currently, the formal requirements are set out in the Designs Regulations 2004 (Designs Regulations) and are based on a paper filing system. At present 99% of design applications are filed electronically, meaning the formal requirements in the Designs Regulations are no longer fit for purpose. 

The amendments will extend the existing power (Designs Act 2003, s 144B.) of the Registrar of Designs (Registrar) to make directions about the form of documents to apply to “approved forms” for designs so that applicants need only to refer to a single source of rules. The amendments will also allow the Registrar to specify formalities requirements for design applications by written determination, which will allow the rules to be easily adapted to keep pace with changing technology.  

Schedule 7: Other amendments 

Schedule 7 to the Bill will make several minor technical corrections and improvements to the Designs Act in relation to the following accepted ACIP recommendations:

• Part 1: Standard of the informed user (ACIP Recommendation 10) 

• Part 2: Revocation of registration of design (ACIP Recommendations 18c and 18f) 

• Part 3: Renewal of registration of design (ACIP Recommendation 18i)

Collectively, the measures in this schedule are proposed to address a small number of inconsistencies in the Design Act. The changes will simplify the designs system for users and clarify parts of the system that may be confusing.

Repair Right Inquiry

The Productivity Commission has today been tasked with an inquiry into the Right to Repair in Australia, something that impinges on consumer protection, patent and other law. 

The media release regarding the inquiry states 

 Background 

The term right to repair describes a consumer's ability to repair faulty goods, or access repair services, at a competitive price. This can relate to a range of product faults, including those for which the consumer is responsible. It may include a repair by a manufacturer, a third-party, or a self-repair option through available replacement parts and repair information. 

The Competition and Consumer Act 2010 (CCA) prohibits anti-competitive behaviour such as exclusive dealing (section 47); however, many right to repair issues are the result of conduct that is not being captured by the prohibition. In many cases, suppliers do not impose any such restrictions on consumers with respect to the repair of products they supply. Instead, consumers or third parties are prevented from being able to repair the products due to a lack of access to necessary tools, parts or diagnostic software. 

For these reasons; existing provisions amount to some limited rights or protections in relation to repair facilities in Australia, but do not amount to a full 'right to repair'. As such, premature product obsolescence and a lack of competition in repair markets remain. The expense of repair and product design accelerate the transfer of consumer goods into waste. 

Scope of the inquiry 

The Productivity Commission should examine the potential benefits and costs associated with 'right to repair' in the Australian context, including current and potential legislative, regulatory and non-regulatory frameworks and their impact on consumers' ability to repair products that develop faults or require maintenance. In examining the Australian context, the Productivity Commission should identify evidence of the impact of relevant international approaches. 

In undertaking the inquiry, the Commission should consider:

• The legislative arrangements that govern repairs of goods and services, and whether regulatory barriers exist that prevent consumers from sourcing competitive repairs; 

• The barriers and enablers to competition in repair markets, including analysing any manufacturer-imposed barriers, and the costs and benefits associated with broader application of regulated approaches to right of repair and facilitating legal access to embedded software in consumer and other goods; 

• The impact of digital rights management on third-party repairers and consumers, and how intellectual property rights or commercially-sensitive knowledge would interact with a right to repair; 

• The effectiveness of current arrangements for preventing premature or planned product obsolescence and the proliferation of e‑waste, and further means of reducing e‑waste through improved access to repairs and increased competition in repair markets; and 

• The impact on market offerings, should firms have their control over repair removed.

Process 

In undertaking this inquiry, the Commission should consult broadly, including with state and territory consumer affairs regulators. The Commission should undertake an appropriate public consultation process including by holding public hearings, inviting public submissions and releasing a draft report to the public. A final report should be provided to the Government within 12 months of the receipt of these terms of reference.

Australian Designs Regime

IP Australia has released an exposure draft of the Designs Amendment (Advisory Council on Intellectual Property Response) Bill 2020 (Cth) and Designs Amendment (Advisory Council on Intellectual Property Response) Regulations, 'intended to provide early benefits to designers ahead of further initiatives in development.

Apart from technical improvements the legislation would amend the Designs Act to benefit designers by:

• introducing a 12 month grace period to help protect designers from losing their rights through inadvertent disclosures made prior to filing 
• expanding the existing limited prior use defence to protect third parties who started preparations to make a design before someone else tried to register it 
• simplifying the design registration process by removing the publication option and making registration automatic six months after filing 
• aligning with the other IP rights by giving exclusive licensees legal standing to sue for infringement. 

Findings from the recently concluded IP Australia review of the Australian design economy and the role of design rights are

• Australian designers contribute more than $67 billion to the economy each year, making up 3.5% of GDP on average, with a strong presence in manufacturing and global value chains. fewer than 0.5% of Australian businesses have held a design right in the last 16 years.
• the design rights system in Australia is currently a niche IP right serving a niche set of industries. 
• Evidence of the economic value of design rights is positive but limited.
• the system is difficult to understand; 'Even experienced users can find it difficult to register and use design rights successfully'.
• Economic analysis shows having a design right predicts some productivity gains for a narrow segment of the economy (businesses in a limited set of ‘design rights-intensive’ industries, primarily in manufacturing and some in wholesale trade)
• Not all businesses can expect an economic benefit from having design rights. 
• Design rights provide value as part of a broader business strategy. A broader strategy that includes design rights often also includes being a part of global value chains, having strong competitive strategies, and using informal design protection methods. Design rights work in tandem with patents and trade marks. 
• Australian businesses with an IP portfolio that combines design rights with patents and/or trade marks are seen to live longer, have more employees, and have a higher average profit per employee than businesses who just have design rights on their own.

Designs

An IPRIA and IP Australia study of Designs Law and Practice  comments

Design capability is increasingly recognised as a source of competitive advantage among countries, and as central to how firms in a diverse range of industries strive to outperform their rivals (Gruber et al., 2015). Australia’s design workforce is small, compared to those of our competitor countries, though productive (Figure 1). However, Australia lags its global peers in the rate at which its design workforce is growing, and in its rate of growth in design intellectual property (IP) generation.

Recognising the importance of design for Australia’s future, IP Australia initiated a collaboration with the Intellectual Property Research Institute of Australia (IPRIA) at The University of Melbourne to produce a comparative study of designs law and practice. This study explores both design across industries within Australia, and how Australia compares for design with its international peers, including several major trading partners.

Recent studies have assessed the suitability of registered design rights as a source of potential information about design innovation (Filitz, Henkel and Tether, 2015; Tucci and Peters, 2015). Yet, there is a lack of research connecting design registrations with design inputs or investments (de Rassenfosse, 2017). 

Our study brings together two well-established approaches for measuring design activity: 

Design IP intensity is a measure of the number of designs registered in a country or industry. 

Design labour intensity is a measure of the number of persons employed in design related occupations, either at the country or industry level.

Both these intensity measures are normalised to account for country or industry level differences. 

This study is the first to our knowledge that brings together these methods to explore, simultaneously, the relative size of design labour forces, and their productivity in design IP generation. 

The report is divided into seven sections inclusive of this introduction.

• Section 2 provides an overview of the designs legal system in Australia and the international context • Section3brieflysetsoutthestudy’smethodology 

• Section 4 explores how Australia compares to its international peers for design labour intensity and the intensity with which Australians use design IP 

• Section 5 explores how industries within Australia vary in design labour intensity and design IP intensity 

• Section 6 presents analysis of the design intensity of industries across national contexts 

• Section 7 discusses potential factors that may affect registrations patterns and offers concluding remarks.

A central finding of this study is that the intensity with which a country makes use of the designs system increases with the design labour intensity of its workforce. Our findings also suggest that a country’s design IP intensity is positively associated with the degree to which design labour is concentrated across its industries. The question this raises is how extensively the designs system encourages investment across the design community at large. To gain greater understanding of Australia’s position, we explored the industries and products in which design filers focus (by “design filers” we refer to applicants of registered designs). Within Australia, residents and non-residents focus in contrasting sectors when registering designs. Australians typically focus in furniture, building materials and clothing manufacturing. By contrast, non-resident applicants maintain a focus in industries such as computer and telecommunications equipment manufacturing. 

We identify those product classes in which there is the greatest imbalance between residents and non- residents in terms of their shares of a class’s total design filings. Of those product classes in which the focus of Australian and non-resident filers is most divergent, non-residents dominate within a large share. We find this to be the case also for certifications and renewals of registered designs. A potential implication is that non-residents focus more strongly on product classes with longer design lifecycles. 

This research was conceived to generate inputs into IP Australia’s Designs Review Program. As such, our focus in studying design IP intensity is on registered design rights. Those design artefacts which are protected by other forms of IP or which are not protected at all fall outside the scope of this study. 

Taking a narrow view of design, we identify from among our global peers several countries that are worthy of emulation as design leaders. We identify, as well, several followers with strengthening design economies. Denmark and Sweden are examples of countries that are low in design IP intensity and low in design labour intensity also, but which are growing at a high rate on both measures.

In the Australian context, we identify industries which appear to underutilise the designs system, given their design labour intensity. This lays ground for further research to address the strengths and weaknesses of Australia’s designs system.

3D printing and Designs

'Who's Afraid of 3D Printing' by Ben Depoorter and Bregt Raus in (2019) Boston University Journal of Science and Technology Law comments 

Heralded for ushering in a new era of personalized manufacturing, there is a growing fear that consumer 3D printing is the next frontier of massive intellectual property infringements. Described as the Napster of patents, illegal 3D printing is foretold to disrupt manufacturing in the same manner as digital piracy unsettled the music industry. 

This Article shows that the negative forecast of rampant 3D printing piracy is overstated. We explain how the purported analogies between P2P file sharing and consumer 3D printing overlook essential differences between piracy of media content and physical property. We caution against aggressive enforcement against unauthorized consumer 3D printing that would impede innovation and the development of 3D printing technologies. 

 The authors argue

 Additive manufacturing is predicted to change the world as we know it. By enabling a do-it-yourself manufacturing model for small companies and consumers, 3D printing is expected to set about an "industrial counter-revolution" of sorts, in which manufacturing is no longer synonymous with assembly lines and processing plants. As 3D technologies become more widespread, the average consumer will, from the comfort of his or her own home, be able to use affordable 3D printers to design and manufacture most products currently available in retail markets. 

Consumer 3D printing has experienced a tremendous boost in recent years. The industry's global market value exceeded $7.3 billion in 2018 and is expected to multiply in coming years. A growing group of users — taking advantage of price reductions in 3D printing hardware — are already engaging with this new technology on home computers, manufacturing physical items such as small sculptures, toys, and decorative or useful items. 

However, as new applications of 3D printing emerge and 3D technologies and markets mature, the 3D printing revolution is causing deep anxiety among some intellectual property owners and commentators. There is a fear that Internet users will scan, upload, and distribute unauthorized 3D models of objects over which they have intellectual property rights. There is growing alarm is that in a world with 3D printing, physical consumer goods will be subject to the same fate as HBO's Game of Thrones: massive online piracy. 

Historically, reproduction and distribution costs have limited the scope of illegal markets for patented and trademarked materials. However, by drastically reducing the costs of reproducing physical objects, 3D scanners and printers pave the way to decentralized piracy of items of manufacture. By enabling the conversion of physical materials into digital format – much like MP3 files did for copyrighted works – 3D printing technologies empower individuals to scan and post objects on the Internet, free for others to download and print in physical form. As a result, 3D printing threatens the value of intellectual property rights. Commentators proclaim that 3D printing presents an existential challenge to the core bargain that underlies patent law: the grant of a time-limited exclusive legal right in an invention in exchange for the inventor's disclosure of the invention.  This bargain "may be meaningless in a world of digitized things." 

Some assert that the digitization of physical objects threatens to disrupt manufacturing industries in a similar, if not wholly parallel, manner as experienced by the music industry in the late 1990s. The dogged enforcement campaign by music record labels during that era vividly illustrates the daunting challenge of enforcing intellectual property rights in a setting of mass, decentralized online infringement. In the file-sharing and torrent era, copyright holders face a mass of individual infringers, each of whom are difficult to identify and costly to pursue.16 Infringement occurs inside the home, creating a perception of security and anonymity among infringers. Stakeholders and observers fear that consumer 3D printing might bring a similar Napster doomsday scenario to intellectual property rights-holders more generally. 

This Article argues that concerns as to a future of rampant consumer 3D printing piracy are exaggerated. Analogies connecting P2P file sharing19 and 3D printing are flawed, as they neglect essential differences between the piracy of audiovisual content and physical goods. The anxiety about 3D printing vastly overestimates the future magnitude of 3D piracy markets. Digitization and printing of physical goods involve substantial costs and efforts that were absent in the Napster-MP3 revolution. 3D printing technologies currently impose considerable burdens on users — including expertise, out-of-pocket costs, and an ever-present risk of defective printouts — and will continue to impose burdens for the foreseeable future. These complications will continue to suppress the supply and demand of 3D pirated materials. 

Furthermore, even if advancements in 3D printing technologies were to eliminate all practical limitations, it is unlikely that manufacturing industries will face a Napster scenario as a result of 3D printing piracy. The demand forphysical materials is less concentrated than for music, the social dimension is less strong, warehousing is expensive, and the manufacturing industry can avoid the social backlash that fueled the fires of digital music piracy. As a result, it is highly doubtful that illegal 3D scanning and printing will confront jewellers, fashion designers, and manufacturers of consumer goods such as toys, games, home furnishings, and sports equipment, with the type of industrywide disruption that the music and movie industries experienced. We caution against aggressive enforcement and preemptive regulatory policies. Alarmist overreactions tend to induce regulatory action that is premature, ill-advised and may harm innovation. To counter these adverse effects, we provide insight to the proper scope and timing of regulatory action in relation to 3D printing. 

This Article is organized as follows: Part I describes the basics of 3D printing, explains how it differs from traditional manufacturing, and evaluates the commercial prospects of consumer 3D printing. Part II describes the rising anxiety about 3D printing piracy and establishes the context for that fear, namely, the digital music piracy era associated with Napster. Part III describes various complications of 3D printing that suppress the public supply and demand of pirated 3D materials. Part IV explains essential differences between music piracy and 3D printing. Part V provides policy recommendations. Part VI concludes.

'A first look at the designs repair defence in Australia' by Tyrone Berger in (2019) 14(5) Journal of Intellectual Property Law & Practice 358–359 comments that in GM Global Technology Operations LLC v SSS Auto Parts Pty Ltd [2019] FCA 97 the Federal Court of Australia delivered the first judgment that reviews the repair defence in the Designs Act 2003 (Cth), ruling that spare parts can be acquired for both repair and enhancement, and the defence should be available in such cases.

Berger argues

Car enthusiasts buy less expensive Holden Commodores and upgrade them with parts designed for the top level Holden Special Vehicle (HSV) and comparable models so that they appear as a more costly version. The owners of these genuine vehicles refer to such practices as ‘mutton dressed as lamb’. In response, the applicant GM Global Technology implements controls over the sale of its HSV parts in an attempt to discourage such practices. GM Global Technology became aware in 2013 that the defendant SSS Auto Parts was importing replica parts for HSVs and commenced proceedings alleging that the replicas infringed its designs registered under the Designs Act 2003 (Cth). SSS Auto Parts responded by seeking to rely on section 72 of the Designs Act 2003 (repair defence), which provides that certain repairs do not infringe registered designs. When a defendant raises the repair defence under section 72, the onus is on the registered owner to prove that SSS Auto Parts ‘knew or ought reasonably to have known’ that use of the impugned parts was not for the purpose of repair. In dispute was whether GM Global Technology has discharged its burden by proving that SSS Auto Parts knew or ought reasonably to have known that the replica parts were purchased as enhancements to customize Commodores to look more like HSVs. As part of the dispute, SSS Auto Parts also filed a cross-claim alleging unjustified threats of infringement. 

Both parties accepted that the qualifying requirements of the repair defence had been satisfied. SSS Auto Parts accepts for the purposes of section 72(1)(a) that it has used products in relation to which a registered design and that each impugned part embodies a design that is identical, or substantially similar in overall impression, to GM Global Technology’s registered design. The parties also accepted that each of the impugned parts is a component part of a complex product within the meaning of section 72(1)(b). However, SSS Auto Parts claims that the use of each of the impugned parts is for the purpose of repair so as to restore its overall appearance of the product in accordance with section 72(1)(c). 

This raised a discussion as to the scope of the repair defence, and the meaning of ‘purpose’ in the context of section 72. GM Global Technology asserted that there needs be a predominant purpose of repair. It contended that the term ‘purpose’ in section 72 should be understood in the same sense of ‘intent’. In this regard, if the registered owner proved that the alleged infringer knew or ought reasonably to have known that the product might (rather than would) be used for a non-repair purpose, then the section 72 defence would fail. On this point, Burley J held that section 72 contemplates that a part may have a dual purpose: for a permitted repair purpose or a non-permitted purpose. Despite concessions by SSS Auto Parts in cross-examination that some parts might not be used for the purpose of repair, the judge stated that the immediate question was the purpose of the importer or seller, not of the person who acquires the part from them. 

Drawing on s117(2)(b) of the Patents Act 1990 (Cth), the judge specified that GM Global Technology ‘must establish on the balance of probabilities that SSS must have known or ought reasonably to have known that the use was not for the repair purpose’ (emphasis in original). SSS Auto Parts contended that its business model was always to supply spare parts for repairs. In this context, the company proceeded to implement ‘repair only policies’ and execute a sales directive, which reflected steps taken in order to ensure that sales were made in the correct manner. Burley J held that ‘it is difficult to imagine a more explicit indication of the purpose’. The judge also found that GM Global Technology had not discharged its burden of establishing that the importing, keeping for sale or offering for sale of replica parts by the defendant was not for the repair purpose. 

Fake Indigenous Cultural Expression

The Commonwealth House of Reps Standing Committee on Indigenous Affairs has released its report on The impact of inauthentic art and craft in the style of First Nations peoples

The title is an innovation; The Committee states

The words ‘First Nations’, ‘Indigenous’ and ‘Aboriginal and Torres Strait Islander’ are used interchangeably in this report to refer to the Aboriginal and Torres Strait Islander peoples of Australia and their art and cultures. 

While the committee understands that some Aboriginal and Torres Strait Islander peoples may not feel comfortable with some of these words, we only mean to convey respect through the use of these words. 

The Committee was to

Inquire into and report on the growing presence of inauthentic Aboriginal and Torres Strait Islander ‘style’ art and craft products and merchandise for sale across Australia, including:

• the definition of authentic art and craft products and merchandise; 

• current laws and licensing arrangements for the production, distribution, selling and reselling of authentic Aboriginal and Torres Strait Islander art and craft products and merchandise; 

• an examination of the prevalence of inauthentic Aboriginal and Torres Strait Islander ‘style’ art and craft products and merchandise in the market;  

• options to promote the authentic products for the benefit of artists and consumers; and 

• options to restrict the prevalence of inauthentic Aboriginal and Torres Strait Islander ‘style’ art and craft products and merchandise in the market.

The Chair's Forward states

Our First Nations peoples have been the guardians of their country and culture for thousands of years. It is an ethical and moral demand that we assist this process into the future.

First Nations art and craft is not simply a collection of design elements in some artistic media presentation. They are in fact a representation of cultural songlines. Art is therefore integral to the cultural identity, stories and history of First Nations peoples. It is about a continuous celebration and preservation of that history and cultures, which underpins all of the issues raised.

An extraordinary statistic that emerged from the evidence received is that 80% of the souvenirs sold in Australia purporting to represent First Nations cultures are in fact imitation products. These inauthentic items have no connection to First Nations peoples and are often cheaply made imports.

The committee’s own observations during several visits to gift shops in popular tourist areas of Sydney were consistent with this overwhelming statistic. What also became clear during this inquiry is that most buyers of these souvenirtype products are likely unaware that they are predominantly inauthentic. Indeed most non-Indigenous Australians and visiting tourists cannot readily distinguish authentic First Nations art and craft from imitation products.

There are two key elements that contribute to this situation. The first is that there is no accepted industry standard for authenticity, which is largely reflected by the confusing and sometime deliberately misleading presentation and labelling of these products. The second is that there is a clear lack of effective education about authenticity throughout the supply chain for First Nations art and craft, from the manufacturer to the point of sale.

First Nations artists and their communities feel completely disrespected and cheated by what is going on at the moment, particularly in the souvenir trade. They feel that their cultures are being stolen through the supply of these imitation products. In addition, they are being denied the opportunity to make a living from the obvious interest and market demand for First Nations art and craft.

This unacceptable misappropriation of First Nations cultures cannot be allowed to continue unchecked. These imitation products exist solely to make money. They demean the rich and ancient history of Australia’s Indigenous peoples. These items have a profound and harmful effect on First Nations peoples. They do not teach or inform the buyer about Indigenous heritage as they have no connection to it. Beyond the immediate consequences mentioned above, this situation has a negative impact on Australia’s image abroad.

Four fundamental points must be stressed:

• First Nations art, craft and cultural expressions belong to First Nations peoples. Non-Indigenous artists and artisans should not appropriate or copy this expression in any way, even with good intentions. 

• Whilst producing and selling imitation First Nations art and craft is not unlawful, it has a negative impact on the integrity of the ancient cultural heritage of First Nations peoples.  

• Any inauthentic piece of Indigenous art, craft or artefact such as a boomerang or didjeridu not made by a First Nations artist is by its very nature and existence purporting to be culturally authentic when it is not. 

• First Nations cultures are an intrinsic part of Australian culture and allowing it to be compromised damages the identity of our nation as a whole.

First Nations fine art does not appear to be affected by authenticity issues to the same extent as the souvenir trade. This is due in part to the buyers being more discerning and the need for galleries to protect their reputation by ensuring the provenance of more expensive artworks. There are still troubling issues in this part of the market however such as alleged carpetbagging by unscrupulous dealers and unethical practices by some galleries.

There are of course other examples of individuals and businesses making outstanding contributions to safeguarding Indigenous cultural expressions. Among these are the First Nations art centres which provide opportunities for Indigenous artists, fostering and preserving their heritage. The Indigenous Art Code does an impressive job of trying to get businesses to adopt its voluntary code of practice, and thus behave ethically and responsibly in the sale of Indigenous art and craft.

They need more help however. Many art centres struggle to retain qualified staff due to lack of infrastructure and housing. This has a hugely negative impact on them as a business. They also need greater access to business development expertise. As many of these centres operate in very remote areas, there are obvious social and economic benefits to growing these businesses.

The Indigenous Art Code has only one staff member and cannot fulfil its mandate with such little resourcing, although it has done a remarkable job to date in spite of this.

There is huge potential for great outcomes in First Nations communities with the right assistance to these key entities and the right policies in place. Another policy area of particular interest was the effectiveness of existing copyright and consumer laws to provide protections for First Nations cultural expressions, including art and craft. Current copyright laws are designed to protect the artistic and intellectual output of an individual over a period of several decades, but not ancient and typically communal ownership of cultural expressions.

In terms of consumer law, the ACCC can take action against a company for intentionally misleading its customers about authenticity through the use of information such as labels. It cannot take action however for imitation products that are not explicitly claiming to be authentic.

First Nations cultural expressions will likely need a new and separate framework to be protected under law. The committee understands that this would be a long and complex task but believes that it is achievable and that a consultation process should be started next year.

The issue of labelling was one that came up often during the inquiry. There is currently no consistent labelling used for any type of art or craft product, whether Indigenous or not, and no legal requirement to indicate whether something is authentic. 

This lack of any consistency or coherency in how First Nations art and craft items such as souvenirs are marked at the point of sale contributes greatly to the current lack of awareness about authenticity. 

The committee welcomes the new digital labelling trial for First Nations artworks to be administered by Desart with government funding support, and awaits the results with interest.

Also of great interest to the committee will be the outcomes of the current Australia Council inquiry into the feasibility of a National Indigenous Art and Cultural Authority. The committee would welcome the establishment of this body and believes that it would play an important future role in deliberating and advising on the issues raised in this inquiry.

Solutions

The committee has made eight recommendations to the Government that it believes will severely curtail the prevalence of imitation Indigenous art and create economic opportunities for First Nations artists and communities. The intention is to chart a path forward to foster and preserve authentic First Nations cultural expressions for the benefit of all Australians.

These recommendations are also intended to start an earnest conversation among Federal, State and Territory policymakers about the harm caused by inauthentic First Nations art and craft.

The committee recommends the following:

• That the Productivity Commission conducts a comprehensive structural analysis of the entire market for First Nations art and craft. It will be difficult for policymakers to be effective in the future without this information.  

• That the Indigenous Art Code be properly funded and a review take place after two years to determine whether this voluntary code of conduct is being effective or whether a mandatory system should be considered. 

• That a separate arm of the existing Indigenous Business Sector Strategy be created for First Nations art centres to build their capacity. 

• That an Information Standard be developed for authentic First Nations art and crafts. 

• That an information guide on authentic art and crafts be developed as a short video presentation to all passengers arriving into Australia. 

• That a Certification Trade Mark scheme for authentic First Nations art and crafts be developed by IP Australia in consultation with all relevant stakeholders. 

• That funding be made available through the Indigenous Visual Arts Industry Support program to assist artists and art centres affected by carpetbagging. 

• That a consultation process be initiated to develop stand-alone legislation protecting Indigenous Cultural Intellectual Property, including traditional knowledge and cultural expressions

US Fashion Protection

'A Design of its Own: How to Protect the Fashion Industry' by Gianna Cresto in American Intellectual Property Law Association Quarterly Journal (Forthcoming) discusses the gap in [US] intellectual property protections for the fashion industry.

 First, it details why fashion is art of the type that typically qualifies for copyright protection, and not just a means of covering the body. Next, it discusses why this hybrid nature makes it unique and worthy of protection under current U.S. copyright law. Because designs are often chosen not just for their functional purpose, but for their artistic and expressive qualities, clothing is different from many other types of works protected by IP frameworks, including trademark and patent. The dual purpose and ability of fashion to be used as a form of expression should not keep if from the protection it deserves. The Supreme Court addressed the standard for copyright protection in the context of clothing design in Star Athletica v. Varsity Brands. 

This Note suggests that this recent development marks an opportune time to push for new legislation that will expand the Star Athletica ruling. These increased protections for the fashion industry should be developed by drawing on other forms of IP protection for fashion in the United States, and protections in place in other countries. These hybrid works call for a hybrid solution. Though its solution, this Note fills the gap for fashion designs, particularly for designers that are just starting out or less conspicuous when it comes to branding.

Disclosure and Traditional Culture

I'llegal Designs? Enhancing Cultural and Genetic Resource Protection Through Design Law' (Emory Legal Studies Research Paper, 2018) by Margo A. Bagley comments

Just a decade ago, a requirement that a designer disclose the origin of traditional cultural expressions, traditional knowledge, and biological or genetic resources used in creating a design in an industrial design application was virtually unheard of in national or regional protection systems. But as awareness of the many ways in which cultural and genetic resource use and misappropriation can occur is evolving, some developing countries have begun exploring the appropriateness of—and in some cases even instituting—such a requirement. 

These developments have taken center stage in the negotiations of a draft Design Law Treaty (DLT) in the World Intellectual Property Organization Standing Committee on the Law of Trademarks, Industrial Designs, and Geographical Indications, which is expected to make it easier for applicants to obtain design protection globally by limiting domestic design registration requirements. Currently, a controversy exists over an African Group proposal to allow policy space in the draft DLT for countries to be able to require design applicants to disclose the origin of traditional cultural expressions, traditional knowledge, and biological or genetic resources used in creating protectable designs. 

This paper focuses on that controversy. It highlights possible justifications countries may have for desiring the flexibility to impose disclosure requirements on design protection applicants; and opines on the broader ramifications of the dispute for policy coherence and mutual supportiveness goals in relation to cultural and genetic resource protection issues.

Designs and the Hague Agreement

IP Australia has released an economic analysis of the costs and benefits to Australia of joining the Hague Agreement Concerning the Registration of Industrial Designs.

The report states

The report assesses the impacts with reference to the Productivity Commission’s (PC) guiding principles of effectiveness, efficiency, adaptability and accountability. This report is intended to form part of the evidence base in relation to whether Australia should join the Hague Agreement. In addition to feedback on this report, we are seeking feedback on any unquantified impacts, not limited to those acknowledged in the report, and welcome case studies and any experience users of the Hague system, or applicants for design overseas have had. Joining the Hague Agreement would enable Australian designers easier access to international markets by allowing them to file a single design application to gain protection in 68 countries and regions. Joining would also require Australia to increase its maximum term of protection for designs from 10 to 15 years, at a minimum. Both the former Advisory Council on Intellectual Property (ACIP) and the PC considered that a cost-benefit analysis should be conducted before the Australian Government decides whether to join the Hague Agreement. In their final report, the PC urged caution - advising a “wait and be convinced” approach.

Under the proposed methodology, it appears that the economic costs to Australia of joining the Hague Agreement outweigh the benefits. The net benefits to Australian applicants are outweighed by significant net costs to Australian consumers (with IP professionals and the Australian Government being subject to smaller net costs). Some costs and benefits are not as easily assessed, and were not quantified in the current analysis, but could affect the net outcome over time. The objective of providing a fertile ground for innovators that is adequately balanced with costs to consumers is an issue requiring careful and ongoing calibration. Realistically, these costs and benefits might only be assessed and quantified at a later date should Australia join the Hague Agreement. Furthermore, we acknowledge that there may be additional evidence gathered in the future which will necessitate further analysis of the potential impacts.

The results are driven by the fact that non-residents currently file almost three times more designs into Australia than resident Australians file abroad, and non-residents maintain these registrations longer on average. Based on the cost-benefit methodology adopted in this report, joining the Hague Agreement could increase this disparity. The report takes account of the fact that accession to the Hague Agreement should also make it easier for Australian residents to file abroad into multiple jurisdictions. The methodology tries to forecast the impact on Australia based on the experience of other Hague accession countries, taking the most positive and negative experiences of other accession countries and using these as the upper and lower bound of what might occur if Australia joined the Hague Agreement.

ACIP concluded that “a significant uplift in international usage would support Australia joining” the Hague Agreement. Despite the United States of America, Japan, and Republic of Korea recently joining, less than 10 per cent of global non-resident design applications were filed through the Hague Agreement in 2016. A number of countries are expected to join in the future, including the People’s Republic of China, Canada and Thailand. These accessions will impact upon any future cost-benefit analysis and may make it more beneficial for Australia to join. This report notes that under certain circumstances, Australian applicants can file design applications through the Hague Agreement already, despite Australia not being a signatory. This pathway is available to Australian applicants that have a residence or an establishment in a member country. Increased awareness of this existing avenue may hold additional benefits to Australia and designers alike.

The report argues -

Net cost to Australia of joining the Hague Agreement at present 

The net present cost to Australia is estimated to be between approximately $25 million and $124 million over ten years, with $61 million being the best estimate. Ten year impacts by stakeholder group are:

• Australian designers: a potential net benefit of approximately $0.03 million to $6 million, with a best estimate of $1.7 million. This is due to increased savings on international applications and increased profits from taking new designs overseas. 

• Australian consumers: a net cost of approximately $23 million to $114 million, with a best estimate of $58 million. This is due to income flowing overseas from Australian consumers paying higher prices to non-resident designers over a longer term of design protection. 

• Australian IP professionals: impacts estimated as between a benefit of approximately $0.3 million and a cost of $12 million, with the best estimate being a cost of $2.5 million. Australian IP professionals will receive some extra business from non-residents at the examination stage, but will likely lose more business at the filing stage as non-residents go through the Hague system. 

• Australian Government: a net cost of approximately $2.3 to $3.4 million, with a best estimate of $2.8 million. This is due to Information Technology system changes that will be required to process applications filed via the Hague Agreement. 

It concludes

We estimate there is a net cost to Australia of joining the Hague Agreement (see Tables 7.1, 7.2, and 7.3 in Appendix 4).

• The most optimistic show an annual net cost starting at just under $1m in the accession year, growing to an annual net cost of $2.5m in the tenth year. The cost over 10 years would be $25.5m in net present value terms under an average 10% annual discount rate.

• The best case show an annual net cost starting at $2.2m in the accession year, growing to an annual cost of $7.1m in the tenth year. The cost over 10 years would be $61.5m in net present value terms.

• The worst show an annual net cost starting at $3.9m in the accession year, and growing to $17.3 m in the tenth year. The cost (over 10 years) would be $123m in net present value terms.

The costs outweigh the benefits, presently

Both ACIP and the PC recommended that Australia should take a “wait and be convinced” approach to joining the Hague Agreement. Most Hague member countries considered similar to Australia) have more incoming registered designs than they do outgoing registered designs, so the benefits to using the Hague system to go overseas are small. While there are some savings to Australian applicants filing overseas, the costs to Australian consumers of the extension of term from 10 to 15 years are estimated to outweigh these benefits by a significant margin under all scenarios.

While we note that some benefits could not be quantified, we also note that there are also costs (for example, social welfare costs) that we have been unable to quantify. We particularly welcome feedback on this aspect.

Applying the PC’s suggested framework for assessing IP policy changes (effective, efficient, adaptable and accountable) we have been unable to find compelling evidence that joining the Hague Agreement would be a net benefit to Australia at the present moment.

We have been unable to find reliable evidence that a longer term of protection would be effective in stimulating additional design innovation. We have found that the efficiency benefits to Australians going overseas are outweighed by the negative income flows (and possibly also the economic inefficiency due to the unquantified social welfare costs) arising from the longer monopoly period. Locking Australia into the Hague Agreement would limit our ability to adapt our IP system in the future. And the above analysis is accountable because it seeks to provide a transparent evidentiary basis to inform a decision to join the Hague Agreement.

8.2 The Hague Agreement landscape will change

A number of countries will join the Hague Agreement in the near future, including China, Canada and Thailand.

The size of the Chinese economy and the volume of its design applications make it a candidate for a country whose accession to the Hague Agreement could represent a ‘tipping point’ that could substantially increase global usage of the Hague system. While China is by far the largest filer of designs globally, China is also Australia’s largest trading partner. Easier access for Australian designers to this significant market, facilitated by the Hague system, might tip the balance for Australia to the point where we had more outgoing applications than incoming applications, which would increase the benefits and reduce the costs to Australia of joining the Hague Agreement.

Canada’s accession is unlikely to be a tipping point in the same way as China. However, their experience could provide a valuable comparison for Australia to re-evaluate the cost and benefits in the future. Canada is similar to Australia in size and population; has a resource-dependent economy; and has a similar legal system. More importantly, Canada, like Australia, would also be moving from a 10 to 15 year design term in order to accede. Canada is set to join the Hague Agreement no earlier than 2018 based on public accounts. We are not aware of any detailed cost benefit analysis performed by Canada. Information from Canada’s experience, once they have joined, would be extremely valuable to assessing the costs and benefits to Australia.

Thailand has previously indicated its intention to join the Hague Agreement in 2015. While that timetable has been delayed, it may be expected to join at some point in the near future. Again, Thailand may provide a useful comparison for Australia when it joins: it is one of the few countries that will have to move from a 10 to 15 year term and is closely linked to many of the same regional markets as Australia.

Steely resolve in IP Reform?

The Productivity Commission's report on Intellectual Property Arrangements features the following unsurprising points 'key points' -

• 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 by the WTO 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.

The Commission offers the following recommendations and findings -

An analytical framework for assessing the IP system 

Recommendation 2.1 In formulating intellectual property policy, the Australian Government should be informed by a robust evidence base and be guided by the principles of: 

• effectiveness, which balances providing protection to encourage additional innovation (which would not have otherwise occurred) and allowing ideas to be disseminated widely • efficiency, which balances returns to innovators and to the wider community • adaptability, which balances providing policy certainty and having a system that is agile in response to change • accountability, which balances the cost of collecting and analysing policy–relevant information against the benefits of having transparent and evidence–based policy that considers community wellbeing. 

Copyright term and scope 

Finding 4.1 The scope and term of copyright protection in Australia has expanded over time, often with no transparent evidence-based analysis, and is now skewed too far in favour of copyright holders. While a single optimal copyright term is arguably elusive, it is likely to be considerably less than 70 years after death. 

Copyright use and licensing 

RECOMMENDATION 5.1 The Australian Government should amend the Copyright Act 1968 (Cth) to: • make unenforceable any part of an agreement restricting or preventing a use of copyright material that is permitted by a copyright exception • permit consumers to circumvent technological protection measures for legitimate uses of copyright material. 

Recommendation 5.2 The Australian Government should: • amend the Copyright Act 1968 (Cth) to make clear that it is not an infringement for consumers to circumvent geoblocking technology, as recommended in the House of Representatives Standing Committee on Infrastructure and Communications’ report At What Cost? IT pricing and the Australia tax • avoid any international agreements that would prevent or ban consumers from circumventing geoblocking technology. 

Recommendation 5.3 The Australian Government should proceed to repeal parallel import restrictions for books to take effect no later than the end of 2017. 

Recommendation 5.4 The Australian Government should strengthen the governance and transparency arrangements for collecting societies. In particular: • The Australian Competition and Consumer Commission should undertake a review of the current code, assessing its efficacy in balancing the interests of copyright collecting societies and licensees. • The review should consider whether the current voluntary code: represents best practice, contains sufficient monitoring and review mechanisms, and if the code should be mandatory for all collecting societies. 

Fair use or fair dealing — what is fair for Australia? 

Recommendation 6.1 The Australian Government should accept and implement the Australian Law Reform Commission’s final recommendations regarding a fair use exception in Australia. 

Recommendation 6.2 The Australian Government should enact the Australian Law Reform Commission recommendations to limit liability for the use of orphan works, where a user has undertaken a diligent search to locate the relevant rights holder. 

The patent system — getting the fundamentals right 

Recommendation 7.1 The Australian Government should incorporate an objects clause into the Patents Act 1990 (Cth). The objects clause should describe the purpose of the legislation as enhancing the wellbeing of Australians by promoting technological innovation and the transfer and dissemination of technology. In so doing, the patent system should balance over time the interests of producers, owners and users of technology. 

Finding 7.1 The Raising the Bar initiative moved the inventive step and other elements of patent law in the right direction by raising the threshold for granting a patent. There is a strong case, however, for further raising the threshold. 

Recommendation 7.2 The Australian Government should amend ss. 7(2) and 7(3) of the Patents Act 1990 (Cth) such that an invention is taken to involve an inventive step if, having regard to the prior art base, it is not obvious to a person skilled in the relevant art. The Explanatory Memorandum should state: • a ‘scintilla’ of invention, or a scenario where the skilled person would not ‘directly be led as a matter of course’, are insufficient thresholds for meeting the inventive step • the ‘obvious to try’ test applied in Europe would in some instances be a suitable test. IP Australia should update the Australian Patent Office Manual of Practice and Procedure such that it will consider the technical features of an invention for the purpose of the inventive step and novelty tests. 

Recommendation 7.3 IP Australia should reform its patent filing processes to require applicants to identify the technical features of the invention in the set of claims. 

Recommendation 7.4 The Australian Government and IP Australia should set patent fees to promote broader intellectual property policy objectives, rather than the current primary objective of achieving cost recovery. To this end, the Australian Government, with input from IP Australia, should: • restructure patent renewal fees such that they rise each year at an increasing rate (including years in which patents receive an extension of term) — fees later in the life of a patent would well exceed current levels • reduce the initial threshold for claim fees, and increase claim fees for applications with a large number of claims. 

The innovation patent system 

Recommendation 8.1 The Australian Government should abolish the innovation patent system. Chapter 9: Business method patents and software patents 

Finding 9.1 Raising the inventive step, requiring technical features in patent claims, and the inclusion of an objects clause would better balance the patent rights of software innovators and users. 

Pharmaceuticals - getting the right policy prescription 

Recommendation 10.1 The Australian Government should reform extensions of patent term for pharmaceuticals such that they are only: (i) available for patents covering an active pharmaceutical ingredient, and (ii) calculated based on the time taken by the Therapeutic Goods Administration for regulatory approval over and above 255 working days (one year). The Australian Government should reform s. 76A of the Patents Act 1990 (Cth) to improve data collection requirements for extensions of term, drawing on the model applied in Canada. Thereafter no extensions of term should be granted until data is received in a satisfactory form. 

Finding 10.1 There are no grounds to extend the period of data protection for any pharmaceutical products, including biologics. 

Recommendation 10.2 The Australian Government should introduce a system for transparent reporting and monitoring of settlements between originator and generic pharmaceutical companies to detect potential pay for delay agreements. This system should be based on the model used in the United States, administered by the Australian Competition and Consumer Commission, and include guidelines on the approach to monitoring as part of the broader guidance on the application of the Competition and Consumer Act 2010 (Cth) to intellectual property (recommendation 15.1). The monitoring should operate for a period of five years. Following this period, the Australian Government should review the regulation of pay for delay agreements (and other potentially anticompetitive arrangements specific to the pharmaceutical sector). 

Registered designs 

Finding 11.1 The Australian Government has committed to implement many of the recommendations made by the Advisory Council on Intellectual Property in its recent review of Australia’s designs system. These measures will help address participant concerns about the cost of acquiring registered design rights, and the lack of understanding of design law. Recommendation 19.2 provides for a low-cost avenue for IP enforcement currently sought by designers. 

Trade marks and geographical indications 

Recommendation 12.1 The Australian Government should amend the Trade Marks Act 1995 (Cth) to:

• reduce the grace period from 5 years to 3 years before new registrations can be challenged for non use 

• remove the presumption of registrability in assessing whether a mark could be misleading or confusing at application • ensure that parallel imports of marked goods do not infringe an Australian registered trade mark when the marked good has been brought to market elsewhere by the owner of the mark or its licensee. Section 97A of the Trade Marks Act 2002 (New Zealand) could serve as a model clause in this regard.

IP Australia should:

• require those seeking trade mark protection to state whether they are using the mark or ‘intending to use’ the mark at application, registration and renewal, and record this on the Australian Trade Mark On line Search System (ATMOSS). It should also seek confirmation from trade mark holders that register with an ‘intent to use’ that their mark is actually in use following the grace period, with this information also recorded on the ATMOSS 

• require the Trade Marks Office to return to its previous practice of routinely challenging trade mark applications that contain contemporary geographical references (under s. 43 of the Trade Marks Act) • in conjunction with the Australian Securities and Investment Commission, link the ATMOSS database with the business registration portal, including to ensure a warning if a business registration may infringe an existing trade mark. 

Recommendation 12.2 The Australian Government should amend the Australian Grape and Wine Authority Act 2013 (Cth) and associated regulations to allow the Geographical Indications (GIs) Committee to amend or omit existing GIs in a manner similar to existing arrangements for the determination of a GI (including preserving the avenues of appeal to the Administrative Appeals Tribunal). Any omissions or amendments to GIs determined in such a manner should only take effect after a ‘grace period’ determined by the GI Committee on a case by case basis. 

Plant Breeder’s Rights 

Recommendation 13.1 The Australian Government should proceed to implement the Advisory Council on Intellectual Property’s 2010 recommendation to amend the Plant Breeder’s Rights Act 1994 (Cth) to enable essentially derived variety (EDV) declarations to be made in respect of any variety. 

Circuit layout rights 

Finding 14.1 Dedicated intellectual property protection for circuit layouts is not ideal and seldom used, but given Australia’s international commitment to protect circuit layouts and no superior alternatives, the best policy option is to maintain the status quo. 

Intellectual property rights and competition law 

Recommendation 15.1 The Australian Government should repeal s. 51(3) of the Competition and Consumer Act 2010 (Cth) (Competition and Consumer Act) at the same time as giving effect to recommendations of the (Harper) Competition Policy Review on the per se prohibitions. The Australian Competition and Consumer Commission should issue guidance on the application of part IV of the Competition and Consumer Act to intellectual property. 

IP and public institutions 

RECOMMENDATION 16.1 The Australian, and State and Territory governments should implement an open access policy for publicly funded research. The policy should provide free and open access arrangements for all publications funded by governments, directly or through university funding, within 12 months of publication. The policy should minimise exemptions. The Australian Government should seek to establish the same policy for international agencies to which it is a contributory funder, but which still charge for their publications, such as the Organisation for Economic Cooperation and Development. 

Finding 16.1 The adoption of an additional ‘use it or lose it’ provision for patents owned by publicly funded organisations is not warranted. 

Intellectual property’s institutional arrangements 

Recommendation 17.1 The Australian Government should promote a coherent and integrated approach to IP policy by: • establishing and maintaining greater IP policy expertise in the Department of Industry, Innovation and Science • ensuring the allocation of functions to IP Australia has regard to conflicts arising from IP Australia’s role as IP rights administrator and involvement in policy development and advice • establishing a standing (interdepartmental) IP Policy Group and formal working arrangements to ensure agencies work together within the policy framework outlined in this report. The Group would comprise those departments with responsibility for industrial and creative IP rights, the Treasury, and others as needed, including IP Australia. 

Finding 17.1 Australia’s approach to negotiating IP provisions in international treaties could be improved through greater use of independent impact assessment and more meaningful stakeholder consultation. 

Recommendation 17.2 The Australian Government should charge the interdepartmental IP Policy Group (recommendation 17.1) and the Department of Foreign Affairs and Trade with the task of developing guidance for IP provisions in international treaties. This guidance should incorporate the following principles: • avoiding the inclusion of IP provisions in bilateral and regional trade agreements and leaving negotiations on IP standards to multilateral fora • protecting flexibility to achieve policy goals, such as by reserving the right to draft exceptions and limitations • explicitly considering the long term consequences for the public interest and the domestic IP system in cases where IP demands of other countries are accepted in exchange for obtaining other benefits • identifying no go areas that are likely to be seldom or never in Australia’s interests, such as retrospective extensions of IP rights • conducting negotiations, as far as their nature makes it possible, in an open and transparent manner and ensuring that rights holders and industry groups do not enjoy preferential treatment over other stakeholders. 

International cooperation in IP 

Recommendation 18.1 The Australian Government should: • pursue international collaborative efforts to streamline IP administrative and licensing processes separately from efforts to align standards of IP protection. In so doing, it should consider a range of cooperative mechanisms, such as mutual recognition • use multilateral forums when seeking to align standards of protection. 

Recommendation 18.2 The Australian Government should play a more active role in international forums on intellectual property policy — areas to pursue include: • calling for a review of the TRIPS Agreement (under Article 71.1) by the WTO • exploring opportunities to further raise the threshold for inventive step for patents • pursuing the steps needed to explicitly allow the manufacture for export of pharmaceuticals in their patent extension period • working towards a system of eventual publication of clinical trial data for pharmaceuticals in exchange for statutory data protection • identifying and progressing reforms that would strike a better balance in respect of copyright scope and term. 

Compliance and enforcement of IP rights 

Recommendation 19.1 The Australian Government should expand the safe harbour scheme to cover not just carriage service providers, but all providers of online services. 

Finding 19.1 Timely and competitively priced access to copyright-protected works is the most efficient and effective way to reduce online copyright infringement. 

Recommendation 19.2 The Australian Government should introduce a specialist IP list in the Federal Circuit Court, encompassing features similar to those of the United Kingdom Intellectual Property Enterprise Court, including limiting trials to two days, caps on costs and damages, and a small claims procedure. The jurisdiction of the Federal Circuit Court should be expanded so it can hear all IP matters. This would complement current reforms by the Federal Court for management of IP cases within the National Court Framework, which are likely to benefit parties involved in high value IP disputes. The Federal Circuit Court should be adequately resourced to ensure that any increase in its workload arising from these reforms does not result in longer resolution times. The Australian Government should assess the costs and benefits of these reforms five years after implementation, also taking into account the progress of the Federal Court’s proposed reforms to IP case management.

Designs

Belatedly catching up with the Governmen'ts response to the ACIP Review of the Designs System (noted here).

The Response is as follows -

ACIP Recommendation 1

ACIP recommends that the Designs Act should be amended, as soon as practicable, to address anomalies identified by stakeholders and to adopt certain specific reforms that will bring Australian designs law into better alignment with equivalent laws of major trading partners, international treaties and proposed international treaties.

Government response

The Government accepts this recommendation. The Government accepts the need for legislative change to address many of the specific recommendations of the review. Responses to the specific recommendations are below.

Recommendation 2

a. ACIP recommends that Australia promote efforts to harmonise a nd streamline procedures for acquiring international registered design rights.

b. Australia should commence an investigation into the implications of joining the Hague Agreement, including consulting with WIPO. Australia should monitor usage of the Hague system and in particular whether usage of the system increases as a result of recent expansions of its membership.

c. Australia should work actively through the Designs Law Treaty process to promote harmonisation of filing requirements.

Government response

a) The Government accepts this recommendation. IP Australia will continue its efforts to encourage international harmonisation and streamlining of registered design systems in different jurisdictions.

b) The Government accepts this recommendation. IP Australia will investigate the implications of Australia joining the Hague Agreement, and continue to monitor usage of the Hague System by our major trading partners.

c) The Government accept s this recommendation. IP Australia will continue its active involvement in promoting harmonisation of international filing requirements through development of the Designs Law Treaty.

Recommendation 3

ACIP recommends extending the maximum term of protection of designs to 15 years only if a decision is made to join the Hague Agreement.

Government response

The Government accepts this recommendation. The Government notes that if Australia joins the Hague Agreement it will be obliged to provide a maximum term of protection of 15 years. The implications of changing the maximum term of protection will be reviewed further as part of investigations into joining the Hague Agreement (see recommendation 2 (b)). This issue is also being considered by the Productivity Commission (PC) in its inquiry into Intellectual Property (IP) arrangements.

Recommendation 4

ACIP recommends changing the terminology for a registered but uncertified design to make it clear that the design does not, until certification, confer enforceable rights. ACIP suggests the term ‘uncertified design’ should be used.

Government response

The Government accepts this recommendation. The Government accepts that it is desirable to clarify when a design is enforceable. The exact terminology will be finalised before implementation.

Recommendation 5

ACIP recommends removing the option of the publication regime ( i.e. without registration) from the designs process.

Government response

The Government accepts this recommendation. Amendments to implement this recommendation are to be included in a forthcoming Intellectual Property Laws Amendment Bill. The Bill will provide for a number of changes to streamline IP processes and support small business. Public consultation on an exposure draft of the Bill will occur before the Bill is introduced to Parliament.

Recommendation 6

ACIP recommends requiring a request for examination of the design by the first renewal deadline (five years).

Government response

The Government notes this recommendation. The Government considers that the response to this recommendation will be closely tied to and dependent on the outcome of the investigation into the implications of Australia joining the Hague Agreement, which the Government will undertake in response to recommendation 2(b).

Recommendation 7

ACIP recommends introducing a system of opposition following certification, if recommendation 6 is accepted.

Government response

The Government notes this recommendation. The Government considers that the response to this recommendation is dependent on the response to recommendation 6, which is itself closely tied to and dependent on the outcome of the investigation into the implications of Australia joining the Hague Agreement.

Recommendation 8

a. ACIP recommends improving the process for multiple design applications by reducing the fees for each additional design added to the application, in accordance with the original proposal of the ALRC.

b. ACIP further recommends that details regarding the eligibility of designs for inclusion in a multiple design application be developed with a view to consistency with relevant international treaties and proposed international treaties and harmonisation, if possible, with requirements in other major offices where Australians are likely to file design applications.

Government response

a) The Government notes this recommendation. The Government considers it appropriate to consider this recommendation further in the context of IP Australia’s current fee review, to be completed in 2016.

b) The Government notes this recommendation. The Government considers that the response to this recommendation will be closely tied to the outcome of the investigation into the implications of Australia joining the Hague Agreement, which the Government will undertake in response to recommendation 2(b).

Recommendation 9

ACIP recommends automatic publication at six months after the filing date, with the possibility to request publication earlier if desired, and with an amendment to the innocent infringer defence in subsection 75(2) of the Designs Act.

Government response

The Government notes this recommendation. The Government considers that the response to this recommendati on requires further consultation as acceptance of this recommendation may have unintended consequences for particular applicants. IP Australia will consult further with stakeholders in order to develop an appropriate response.

Recommendation 10

ACIP recommends retaining the requirement of distinctiveness and section 19 of the Designs Act in its current form.

Government response

The Government accepts this recommendation.

Recommendation 11

ACIP recommends allowing amendment of the Statement of Newness and Distinctiveness in ways that identify particular visual features of the design as new and distinctive, up to the point of certification.

Government response

The Government accepts this recommendation in principle. The Government notes that at present a Statement of Newness and Distinctiveness (SoND) cannot be amended when new prior art is identified in the course of examination. This means an applicant cannot amend the SoND to clarify what makes their design new and distinctive from prior art they may have been unaware of at the time of filing the SoND. This limits its usefulness to applicants. The Government accepts the principle that an applicant should be able to amend the SoND, provided that it does not broaden the scope of the design owner’s right. However, the Government considers that this recommendation requires further consultation to ensure that there are no unintended consequences before implementing change.

Recommendation 12

ACIP recommends introducing a grace period of six months before the filing date, together with a prior user defence. Applicants who rely on the grace period to protect the validity of their design rights should be required to file a declaration to that effect.

Government response

The Government accepts this recommendation. The Government agrees to introduce a grace period together with a prior user defence. The length of the grace period and requirement for an applicant to declare any disclosures at the time of filing will be determined at a later stage following further stakeholder consultation and development of international norms.

Recommendation 13

a. ACIP recommends retaining the current requirement that protection relates to the visual appearance of a whole product.

b. ACIP recommends that, in investigating opportunities for international cooperation in design application processes and requirements with other offices overseas, IP Australia consider whether allowing partial product registrations would enhance harmonisation of application requirements in a way that would substantially advantage Australian applicants. If significant advantages to Australian applicants can be shown and IP Australia can confirm that such protection does not give rise to substantial practical or legal issues overseas, then ACIP would support reform of Australian law.

Government response

a) The Government accepts this recommendation.

b) The Government accepts this recommendation. The Government notes the potential benefit of aligning Australia’s designs system with those of key trading partners for Australian applicants seeking international protection. However, extending protection to partial designs would be a fundamental change to the current Designs system, and would provide legal rights that broadly encompass a large range of very different-looking products sharing one particular design feature. This could lead to increased complexity and costs in challenging the validity of any relevant design. Australia should not change the current system without detailed analysis of the costs and benefits. Through its international engagement activities, IP Australia will continue to assess whether allowing partial product registrations would enhance harmonisation of application requirements in a way that would substantially benefit Australian interests. This issue is also being considered by the PC in its inquiry into IP arrangements.

Recommendation 14

ACIP recommends that the treatment of virtual or non-physical designs be reconsidered, for example by allowing consideration of the product in its active state, not just its resting state, when considering validity.

Government response

The Government accepts this recommendation. Through its international engagement activities, IP Australia will continue to assess whether specific considerations for the treatment of virtual or non-physical designs would benefit Australian interests. This issue is also being considered by the PC in its inquiry into IP arrangements.

Recommendation 15

ACIP recommends that steps should be taken to make section 18 of the Designs Act consistent with the overlap provisions of the Copyright Act 1968.

Government response

The Government accepts this recommendation in principle. IP Australia, which administers the Designs Act 2003 (Designs Act), and the Department of Communications and the Arts, which administers the Copyright Act, will investigate taking steps to make section 18 of the Designs Act and the overlap provisions of the Copyright Act consistent with each other.

Recommendation 16

ACIP recommends the Government consider introducing (with appropriate resourcing of Customs) border protection measures that align with the Trade Marks and Copyright Acts (Notice of Objection Schemes) to allow for the seizure by Customs of alleged design infringements which are identical to certified designs.

Government response

The Government does not accept this recommendation. The Government considers that the proposed introduction of border controls in respect of alleged design infringements would pose a range of practical difficulties, and would be resource intensive for the Australian Border Force (ABF) to implement. The Government notes that the Designs Act currently provides rights holders with opportunities to take action domestically, for example seeking injunctive relief and damages, against suspected infringements of certified designs. A determination in relation to whether a  product infringes a design right is a decision made through the courts. In practice this means the rights holders, under current legislation, can provide the ABF with a court order preventing the release of particular imported goods, along with actionable intelligence to assist in identifying the specific shipment. ACIP Designs Review

Recommendation 17

ACIP recommends retaining section 71 of the Designs Act in its present form.

Government response

The Government accepts this recommendation. The Government notes that although ACIP considered there is an anomaly between section 71 in relation to infringement of design and section 10 in relation to the exclusive rights of owners, this has not given rise to any problems in the operation of the Designs Act. Furthermore, ACIP cautioned that ‘fixing’ this anomaly would create uncertainty and could have unintended effects. ACIP Designs Review

Recommendation 18

ACIP recommends amending the legislation as soon as practicable to address specific anomalies identified by stake holders and listed by ACIP below. ACIP considers that these amendments would improve the operation and consistency of the Act and in some cases, consistency with other IP systems. The Designs Act and/or the Designs Regulations 2004 should be amended to ensure:

a. That rules regarding the identity of Convention applicants are consistent with rules relating to entitlement to designs;

b. That international Convention applicants are not disadvantaged in cases where formal requirements differ between jurisdictions, by expanding the rules relating to priority claiming;

c. Courts have the power, similar to that available under the Patents Act 1990 to refuse to revoke a design registration on the basis of lack of entitlement of the named applicant in appropriate circumstances;

d. Design registrations are revocable on the basis of a lack of entitlement at the time of the revocation proceeding (rather than at the time of registration);

e. The prior art base against which newness and distinctiveness is considered is expanded to include designs for products other than the product the subject of the registered design;

f. The ground of revocation on the basis of fraud, false suggestion or misrepresentation extends to fraud, for example, during certification (not just registration);

g. The opportunity to amend is broadened to allow for amendment other than to overcome a ground of revocation;

h. Exclusive licensees have the right to bring proceedings for infringement; and

i. Grace periods for renewal deadlines align with other IP Rights.

Government response

The Government accepts these recommendations with the proviso that Australia will continue to comply with relevant international treaties and conventions; and any change to the Designs Act does not result in an unintended advantage of one type of application ( i.e. convention claim) over another type of application ( i.e. non-convention claim). Amendments to implement recommendation 18(i) are to be included in the forthcoming Intellectual Property Laws Amendment Bill. The Bill will provide for a number of changes to streamline IP processes and support small business. Public consultation on an exposure draft of the Bill will occur before the Bill is introduced to Parliament.

Recommendation 19

ACIP recommends no change to the trade mark/design overlap. Government response The Government accepts this recommendation. The Government notes that the present Review found no evidence of any problem with the present trade mark/design overlap.

Recommendation 20

ACIP recommends no change to the Repair Defence.

Government response

The Government accepts this recommendation. The Designs Act introduced a Repair Defence provision into the Designs system. Where a component part is used for repair of a complex product to r estore its overall appearance, the manufacturers and suppliers of the component part are exempted from any liability for infringement. The Government notes that ACIP found no evidence of any problem with the present repair defence provision that would warrant changing the present system.

Recommendation 21

ACIP recommends no change to the designs system at this time to respond to 3D printing and scanning technologies.

Government response

The Government accepts this recommendation. The Government notes that ACIP received few submissions supporting reforms in this area, while other submissions noted that it would be premature to amend the Designs Act to account for technological advances. The Government considers that it would be premature to take legislative action when there is no evidence of any existing problem. The Government will continue to monitor technological developments and their implications for the designs system.

Recommendation 22

ACIP recommends that Australia should not introduce protection for unregistered designs.

Government response

The Government accepts this recommendation. Unregistered Design Rights give a designer the right to prevent others from copying their designs for a certain period without requiring them to register their design or satisfy an innovation threshold. The Government notes that submissions to ACIP were generally opposed to the introduction of Unregistered Design Rights, and suggested it would undermine the current registered design system.

Recommendation 23

ACIP recommends that the role of the designs system be specifically included in any broader review of Australia’s IP framework, such as a broader review that may be proposed in the Final Report of the Competition Policy Review.

Government response

The Government accepts this recommendation. The role of the designs system has been included in the terms of reference of the PC inquiry into Australia’s IP arrangements. This inquiry was announced by the Treasurer and the Minister for Small Business on 18 August 2015, and the PC is expected to report in August 2016.