a rigorous statistical tool that business and policy makers can use to measure a country’s direction as they seek to chart a course to promoting an innovative and creative economy.The destination is, of course, one that privileges members of the US Chamber of Commerce and the ranking, despite references to rigour, is problematical.
The authors claim that
It is also possible to use the GIPC Index as a measure of IP rights and correlate it to other areas of economic activity. While correlations fall into the field of descriptive statistics (i.e., they do not presume to suggest causality), they are nonetheless important and can provide a broad picture of the link between different areas of the legal and economic environment in countries.The Index is based on thirty indicators in five categories -
Category 1: Patents, Related Rights, and Limitations
1. Patent term of protection
2. Patentability requirements
3. Patentability of computer-implemented inventions
4. Pharmaceutical-related patent enforcement and resolution mechanism
5. Legislative criteria and use of compulsory licensing of patented products and technologies
6. Patent term restoration for pharmaceutical products
7. Regulatory data protection term
Category 2: Copyrights, Related Rights, and Limitations
8. Copyrights (and related rights) term of protection
9. Legal measures that provide necessary exclusive rights that prevent infringement of copyrights and related rights (including Web hosting, streaming, and linking)
10. Availability of frameworks that promote cooperative action against online piracy
11. Scope of limitations and exceptions to copyrights and related rights
12. Digital rights management legislation
13. Clear implementation of policies and guidelines requiring proprietary software used on government information and communication technology (ICT) systems to be licensed software
Category 3: Trademarks, Related Rights, and Limitations
14. Trademarks term of protection (renewal periods)
15. Non-discrimination/non-restrictions on the use of brands in packaging of different products
16. Ability of trademark owners to protect their trademarks: requisites for protection
17. Legal measures available that provide necessary exclusive rights to redress unauthorized uses of trademarks
18. Availability of frameworks that promote action against online sale of counterfeit goods
Category 4: Trade Secrets and Market Access
19. Protection of trade secrets
20. Barriers to market access
Category 5: Enforcement
21. Physical counterfeiting rates
22. Software piracy rates
23. Civil and procedural remedies
24. Pre-established damages and/or mechanisms for determining the amount of damages generated by infringement
25. Criminal standards including minimum imprisonment and minimum fines
26. Effective border measures
Category 6: Membership and Ratification of International Treaties
27. World Intellectual Property Organization (WIPO) Internet Treaties
28. Singapore Treaty on the Law of Trademarks
29. Patent Law Treaty
30. At least one free trade agreement with substantive and/or specific IP provisions such as chapters on IP and separate provisions on IP rights provided it was signed after World Trade Organization/TRIPS membershipThe report states that
Australia’s overall GIPC Index score has decreased from 86% to 81% of the total available score, primarily in Category 1: Patents, Related Rights, and Limitations. Among other elements, recent actions by the Australian government have limited the ability of innovative pharmaceutical companies to seek adjudication of patent infringement by placing extra costs on companies with claims that are found to be invalid or non-infringing.It goes on to comment that
Australia’s overall score has dropped from 87% of the total possible score (with a score of 21.63) in 2012 to 81% in 2014. This is mainly due to changes to the scoring methodology in 2014 that allow scores to better reflect existing weaknesses in Australia in pharmaceutical patent protection; the online copyright sphere, including an adequate notice and takedown mechanism; and enforcement of intellectual property rights, particularly in terms of civil remedies.
Patents, Related Rights, and Limitations
2. Patentability requirements: For a patent to be valid in Australia, it must be new, involve an inventive step, and have industrial applicability. Based on the IP Laws Amendment (Raising the Bar) Act of 2012, inventive step is assessed against the common general knowledge, considered either alone or together with additional prior art. The new law has also introduced greater flexibility concerning the requirements for opposing patents, for instance allowing for pre-grant opposition, but at the same time provides for the patentability of medical treatment methods.
4. Pharmaceutical-related patent enforcement and resolution mechanism: The Therapeutic Goods Act sets out a relatively transparent mechanism for adjudicating infringement issues as part of the market authorization process for generic or biosimilar medicines. Under the mechanism, the onus is on the applicants to notify patent holders of the application for registration or listing of the product, although the health regulator, the Therapeutic Goods Administration (TGA), also makes information about registrations publicly available. However, the mechanism may be deficient in cases where the applicant is not aware of relevant patents and, hence, does not notify the patent holder, particularly because there are known delays in the publishing of registration information by the TGA. As a result, patent holders may not discover infringement issues until aftermarket authorization has taken place in these cases. Recently, it has become possible for patent holders to be put at an additional disadvantage in the adjudication process: in the last few years, the Australian government has required (or threatened to require) patent holders to compensate generic companies and government agencies for delays in generic entry caused by court imposed injuctionsm, but has not taken a similar position in relation to losses experienced by innovator companies as a result of premature generic entry.
6. Patent term restoration for pharmaceutical products: A patent term restoration of five years is allowed under Australian patent law; hence, Australia receives a full score of 1. During 2012, an expert panel reviewed this provision. Its draft report, released in April 2013, contained various recommendations aimed at limiting patent term restoration, including reducing it, making it contingent on certain factors, and replacing it altogether with direct government subsidies for research and development. A closed final report has been submitted to the government. However, due to the recent change in government as a result of federal elections in September 2013, it is unclear at this stage if the new government will take action. If the term of extension were to be reduced, this would lower Australia’s score for this indicator in future editions of the Index.
Copyrights, Related Rights, and Limitations
11. Scope of limitations and exceptions to copyrights and related rights: The Copyright Act establishes a relatively categorical system of fair dealing and exceptions to copyright, which is applied consistently by the courts. Most recently, in National Rugby League Investments v. Singtel Optus (2012), the court upheld the requirement of non-commercial use for the time-shifting exception in Section 111 when it ruled against the recording of television broadcasts by commercial parties for watching at a later time in a domestic context. The Australian Law Reform Commission is currently conducting a review of exceptions to copyright in the digital environment, which is expected to be publicly released in February 2014.
Trademarks, Related Rights, and Limitations
15. Non-discrimination/non-restrictions on the use of brands in packaging of different products: The Tobacco Plain Packaging Act, which took effect in December 2012, restricts the use of trademarks on retail packaging of tobacco products, requiring them to be sold in non-descript packages. The new measure severely limits the ability of trademark GIPC international IP index owners to exploit their rights sufficiently, and has ignited a global debate on the use of plain packaging that threatens to affect trademark owners across different sectors and countries. In 2013, five countries, including Ukraine and Indonesia, brought action against Australia in the WTO on the basis that the law violates its WTO commitments, specifically under the Technical Barriers to Trade, TRIPS, and GATT agreements. WTO dispute panels and consultations are currently under way.
18. Availability of frameworks that promote action against the online sale of counterfeit goods: Action against an ISP whose services are used to violate trademark rights is not commonly available in Australia. This is because an infringement action under the Trademark Act requires explicit “use as a trademark,” and courts have been reluctant to apply this provision to cases of indirect or contributory infringement. There is the possibility of using the Australian Consumer Law to hold an ISP liable for infringing activity on their websites, but such action has only been brought in an indirect manner with a settlement occurring outside of the court (for instance, in Google v. Australian Competition and Consumer Commission [ACCC], 2013).
Enforcement
25. Criminal standards including minimum imprisonment and minimum fines: The Raising the Bar Act has increased the Copyright and Trade Marks Acts’ penalties to a maximum of five years imprisonment and 550 penalty units ($55,000 for individuals or $275,000 for companies). Application of the raised penalties is unknown at this time given the recent entry into force of the act. However, prior evidence suggests that Magistrates and Federal Courts often do not apply sufficient deterrent penalties, particularly in cases of digital piracy and illegal camcording.
Membership and Ratification of International Treaties
Australia receives a full score in this category, having signed and ratified all major international IP treaties as well as having concluded post-TRIPS FTAs with substantial IP provisions. Australia is also a negotiating party to the Trans-Pacific Partnership.
