Intellectual property rights and Australia

Natalie attended the 2012 WTO Public Forum in Geneva where she represented The University of Melbourne: Faculty of Business & Economics. She is currently studying a Bachelor of Commerce and is a recipient of the Commerce Opportunity Bursary.

Abstract 

The Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement is an integral component of the outcomes of the Uruguay Round in 1995. It resulted from a series of negotiations by the World Trade Organization (WTO) members that aimed to address the increasing need in protecting human’s innovation. At the most basic level, TRIPS was essentially created to establish the minimum standards by which WTO expects its members to enforce the protection of intellectual property rights. Furthermore, TRIPS reiterates the importance of transparency in the governance of national economies. WTO members, upon signing TRIPS, are subjected to the WTO periodic reviews about their intellectual property rights protection system. This paper attempts to give an overview of Australia’s obligations under TRIPS and what attempts have been made by the Australian government to fulfil these obligations.  

Introduction 

Australia’s trading system has always been traditionally substantiated by research and technical inventions so intellectual property is vital in protecting rights for Australian innovators. Billionaire James Dyson- founder of Dyson bagless vacuum cleaner-supports this idea in his article on the Age, stating that intellectual property ‘protects future prosperity’ and that ‘protecting ideas is a significant investment’1. Recognising this, the Australian government had valued intellectual property from the outset and has created legislation to protect them, such as the Copyright Act 1905 or the Patents Act 1903. By giving creators the confidence that their rights will be protected by federal law the government encourages them to keep contributing to the growing economy of Australia and thus help building a stronger trading system. Prior to the TRIPS, intellectual property rights in Australia had already been covered in various federal laws but it was not until after Australia signed this agreement that the standards of these protections were updated so that they would be harmonised with the rest of the world in regards to intellectual property protection.  Nothing short of listing a whole agreement will sufficiently cover all obligations that Australia agreed to when signing the TRIPS so this paper will deal with the most common aspects of intellectual property, which are copyright, trademarks and patents. By looking at how the government responded to these aspects I will attempt to draw out a pattern and evaluate how well Australia has lived up to its promises.  

Copyright  

Copyright is in many ways a very extensive topic, both in its commercial meanings and its broad coverage in the TRIPS agreement. However, Australia’s obligations under this section can be summarised as followed: 

  • Computer programs should be protected as per the Bern Convention (1970) (Article 10)2 

  • Term of protection for works entitled to intellectual property rights should be no less than 50 years (Article 12)3.  

  • Performers, broadcasting organizations and producers of sound recordings in Australia should be given the right to prevent unauthorised reproduction of their creations (Article 14)4.  

  • Rental rights for authors of computer programs and cinematographic works (Article 11)5. 

Australia has taken appropriate steps to fulfil its obligations under the copyright section of the TRIPS and one of them is the Copyright (World Trade Organization amendments) Act 1995. As the title suggests, this act was passed to address the required standards outlined in the TRIPS6. This version of the Copyright Act introduced for the first time producers’ copyright rights on the rental of their sound recordings, as required by article 14. Additionally, article 12 necessitated the extension of protection terms from 20 years to 50 years for performers, broadcasting agencies and any other entities eligible for intellectual property protection. Australia’s implementation of a separate act to address the issues outlined in the TRIPS gives no doubt as to its dedication to the TRIPS agreement. By incorporating the TRIPS into its legislations, Australia makes its stance very clear to international trade partners that copyright was and will always be given appropriate attention. This incorporation also serves to alert the public of the crucial role that copyright plays in strengthening the Australian economy.  

However there appears to be some limitations to the Copyright (WTO amendments) Act that partially impairs Australia’s ability to completely honour its obligations under the TRIPS. Any other protections set out in the copyright section of the TRIPS that were not implemented by the Copyright (WTO amendments) Act were said to be already included in pre-existing legislations concerning copyright7. However in a review by the Council for TRIPS8, the European Communities (EC) questioned the validity of Australia’s decision not to protect the exclusive commercial rental right for cinematographic works in the amended Copyright Act. The Department of Foreign Affairs and Trade explained in one of its official statement that this was ‘because rental had not, in Australia, led to widespread copying of such works to the extent that the exclusive right of reproduction was materially impaired.’9 One must wonder if the government had taken into account the fact that cinematography was rapidly gaining its popularity in Australia and the inclusion of such right in the current amendment would eliminate the hassle of having another amendment later on when cinematographers actually demand the establishment of this right. The EC was on the same track when it inquires Australia if ‘the rental of cinematographic works in Australia has led to widespread copying of such works which is materially impairing the exclusive right of reproduction of authors (Article 11 of the TRIPS Agreement)’ in the review mentioned earlier. The European Communities’ query was not unguaranteed because disregarding a specific article of the TRIPS (article 11 about cinematography copyright) constitutes a breach and the consequences can be detrimental. Following the Copyright (WTO amendments) Act 1994, Australia has implemented a number of amendments to the original Copyright Act in 1905 but they progressively contain less relevant topics to the TRIPS agreement. For instance the Copyright Amendment Act 2000 contained provisions for digital agenda and moral rights, the 2003 amendments were in regards to parallel importation and the 2006 version was made to accommodate the US-Australia Free Trade Agreement. Consequently it is within reasons to conclude that the original obligations under TRIPS may have been unintentionally forgotten in the midst other important international trade agreements.  

Fortunately, Australia can still fully legitimise the TRIPS agreement in its legal system by administering some changes. It is true that the government had founded the Australia Copyright Council to primarily deal with copyright-related issues but this Council’s responsibility is to maintain the rights of artists, as stated on the website10, whereas Australia as a whole needs a specific body or agency to monitor the rapidly changing national economic circumstances and constantly apply them to the TRIPS agreement. The task of implementing copyright protection by itself is by no means an easy task so assigning the role of perpetually reviewing Australia’s obligations under TRIPS to the Copyright Council is simply unwise and unproductive. This responsibility should be appointed to a body specifically delegated to work closely with the TRIPS agreement and propose changes to address the TRIPS obligations more effectively as the need arises.  

Trademarks 

Section 2 part II of the TRIPS agreement sets out the minimum standards with which all member countries should extend their trademarks protection by. Under this section, Australia is obliged to make changes in regards to definition, registrability and infringement of trademarks.  

In response to the issues outlined above, Australia amended the original Trade Marks Act in 1955 and passed a new version in 1995 that is more applicable to the TRIPS agreement. The TRIPS introduced a new concept called the test of ‘capable of distinguishing’11 which was not previously covered by the original Trade Marks Act. The Trade Marks Act 1995 effectively extended the register of trademarks to address this particular test and erased the distinction between ‘distinctive trademarks’ and ‘marks capable of being distinctive’. The definition of trademarks in the 1955 Act was considered obsolete and not reflective of Australian economical circumstances at the time. This also coincided with a provision of the TRIPS so the Trade Marks Act 1995 redefined trade mark as followed: 

‘a sign used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person’12

The TRIPS also required a stricter approach to the establishing of an infringement. Previously according to the Trade Marks Act 1955, an infringement only occurred if the mark was used on the same goods that the trade mark was registered. The Trade Marks Act 1995 expanded this to include ‘similar or identical goods’ as required by the TRIPS. The provision of ‘causing confusion’ was made more limited by the TRIPS. Under the former act, the offence can only be established if confusion is likely to occur whereas the TRIPS agreement specifies that for goods that are identical, confusion is presumed to exist. Evidently the Trade Marks Act 1995 more than adequately covered the important aspects of the TRIPS and demonstrated Australia’s willingness to honour its promises with the World Trade Organization. To the extent of incorporating TRIPS into each member’s federal legislation, Australia had acted in a very timely and efficient manner because the revised Trade Marks act was enacted just a few months after the conclusion of the Uruguay Round.  

However, a review conducted by the Council of TRIPS in 1996 reviewed that other members of the World Trade Organization still had doubt about Australia’s intentions regarding the TRIPS. In particular the European Communities and Japan had concerns that the qualifications for textual designs protection are difficult to meet because the Designs Act 1906 does set very substantive requirements for such designs to be eligible for intellectual protection13. The fact that Australia chose to cover the protection for fashion designs exclusively in the Designs Act 1906 long before the TRIPS agreement may constitute to a breach of Article 25.2 , which requires members to ‘ensure that requirements for securing protection for textile designs... do not unreasonably impair the opportunity to seek and obtain such protection’14. This is because under the Designs Act 1906, the process of acquiring protection for textual designs is lengthy, formal and very costly. This notion was also supported by the Australian Law Reform Commission (ALRC) when it prepared a set of proposed amendments for the Designs Act 1906 to the Commonwealth Attorney General. In this review, the ALRC reported an increasing public concern that ‘the registration process is too slow and costly for 

the benefits of the protection it provides’15. This means that not only foreign countries had trouble with Australian law in this regards, the Australian public also found it cumbersome and obsolete. The United States also questioned the establishment of a presumption of likelihood of confusion in the Trade Marks Act 1995. While the Act in question does address the confusion test raised by the TRIPS, it does not, in the US’s view, adequately narrows it down to such degree that would limit a party’s likelihood of avoiding infringement , as specified by the TRIPS.  

Admittedly, Australia’s trademarks law still has some room for improvement because the Trade Marks Act 1995 and the Designs Act 1906 are perceived to contain some ambiguous sections, whether it was intentional on the Australian government’s part or caused by different perspectives on TRIPS is impossible to tell. However, it is not as challenging to address some of the issues that the European Communities or other countries raised. The Parliament can perhaps amend the Designs Act 1906 to lower the requirements of textual designs’ eligibility for protection and thus incorporate the TRIPS more fully into federal law. This will satisfy most countries’ enquiries into the protection of fashion designs and increase Australia’s efficiency in obliging the TRIPS.  

Patents

The main effects of the TRIPS were the extension of the standard patent term from 16 years to 20 years, the notion of ‘burden of proof’ and adjusted provisions on compulsory patents.  

As with copyright, Australia implemented a legislation to specifically bring Australia’s patent law into conformity with the TRIPS called Patents (World Trade Organization amendments) Act 1994. Standard patent term was increased from 16 years to 20 years, as specified by article 3316. The concept of ‘burden of proof’ was introduced for the first time to the Australian public to address article 34. This notion can only be applied to ‘a process of obtaining a product’, which places the burden of proof on the defendant to show that the process in question is different from the plaintiff’s patented process. The third major change that the amended act brought about was adjusted provisions on compulsory licenses. The TRIPS dictates that when a member’s law allows for other use of a patent without authorization of the right holder, certain conditions need to be satisfied. Some of those had already been included in the Patents Act 1990, only the followings were added to the amended Patents Act:  

  • The applicant of the compulsory license in question must prove that they have sacrificed reasonable time and effort to obtain authorization from the original owner of the patent. 

  • The Crown use of patents must follow a certain number of specific rules.  

  • The original holder of the patent must be entitled to remuneration according to the economic value of the patent.  

  • Additional conditions are applied when the use of the first patent inevitably leads to an infringement on the second patent.  

Though on the surface the Patents (WTO amendments) Act seemed to satisfy all the TRIPS requirements in regards to patents, the reviews conducted by the WTO council for TRIPS revealed that other countries were not quite on track with Australia. In particular the European Communities (EC) and the United States questioned the transparency of the process with which the Crown acquired a patent17. Though Australia maintained that section 51(xxxi) of the Australian Constitution forbids any unjust acquisition by the Crown, the EC argued that the wording of the Constitution was ambiguous in this respect and thus the Crown’s integrity must be guaranteed by more concrete terms in the amended Act. As it was Australia risks violating article 8 of the TRIPS, which condemns the abuse of intellectual property rights and unfair practices that hinder the clarity of international trade. This issue was not only recognisable to international nations; it was also a source of concern for the Australian Advisory Council on Intellectual Property (ACIP). In a discussion paper on Crown use provisions on patents, the ACIP, much like the European Communities and United States, questions if there is ‘sufficient justifications for the Crown use provisions to continue’18. The United States also had concerns with certain articles19 of the Patents Act 1990 which allow for the granting of compulsory licenses in special circumstances, regardless of the technological field that the application was made under20. This, according to the US, is not compatible with article 31(c) of the TRIPS agreement, which states that compulsory licenses under patents relating to semi-conductor technology can only be issued for purpose of ‘public non-commercial use or to remedy a practice determined after judicial or administrative process to be anti-competitive’21. The US’s view is that the amended Patents Act should only allow for the issuance of compulsory licenses under patents concerning semi-conductor technology when the conditions in the TRIPS are met.  

Upon reading the WTO’s review on Australia’s process, it is plain that not just the European Communities but the United States and Japan question the legitimacy of the acquisition of patent for Crown’s use. Perhaps the Parliament should consider amending the Patents Act to set out a separate process of reviewing and granting patent for Federal use. This will serve two purposes; one is to reinforce the notion of equality that the government must go through the same, if not more difficult, process of applying for patent like the rest of the population, two is to prove to other WTO members that Australia is not abusing the Crown power to skip around the process set out by the TRIPS. A solution is suggested by the Australian Advisory Council on Intellectual Property, which is that ‘Crown use should only be permitted after Ministerial approval’22. This is a fair proposal because Commonwealth Ministers are answerable to Parliament, and ultimately to the public, about their actions. This proposal, if implemented, will ensure that Crown acquisitions concerning patents will be processed with integrity and transparency.   

Conclusion

After analysing legislations that the Australian government have implemented in order to satisfy the TRIPS’ requirements regarding intellectual property rights protection, it is clear that Australia has been very diligent and efficient in combining the TRIPS with Australian law. However there were still some questions from the European Communities and United States that Australia could have been more confident in addressing. The solutions suggested above, including amending pre-existed legislations and delegating more bodies to deal with intellectual property issue, are just specific measures for a particular problem. What Australia needs is a more thorough understanding of the TRIPS and how it can be applied to the Australia economy. This can be achieved by giving intellectual property more attention in the media or make it a priority for the government so that economic experts in the public can study the TRIPS and help the government in responding to it more effectively.  

Bibliography  

  • Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, 1869 UNTS 299; 33 ILM 1197 (1994) 

  • Australian Copyright Council-2010, About us-Our missions, Australia, viewed on September 4th 2012,  < http://www.copyright.org.au/about-us/

  • Council for Trade-Related Aspects of Intellectual Property Rights, World Trade Organization, 1997. Review of Legislation on copyright and related rights.  November 1st 1996. World Trade Organization

  • Council for Trade-Related Aspects of Intellectual Property Rights, World Trade Organization, 1997. Review of Legislation on trade marks, geographical indications and industrial designs Australia.  August 13th 1997. World Trade Organization. 

  • Council for Trade-Related Aspects of Intellectual Property Rights, World Trade Organization. Review of legislation in the field of patents, layout-designs (topographies) of integrated circuits, protection of undisclosed information and control of anti-competitive practices in contractual licences. October 22nd 1997. World Trade Organization. 

  • Davison, M.J., Monotti, A.L. and Wiseman, L., 2008. Australian Intellectual Property Law. Australia: Cambridge University Press.  

  • Department of Foreign Affairs and Trade-October 1999, TRIPS implementation in Australia a practical perspective, Australia, viewed on September 3rd 2012, <http://www.dfat.gov.au/publications/informal_survey_ip_law_trips/informal_survey_ip_law_trips_appendix.pdf

  • Designs (ALRC Report 74), August 31st 1995, Australian Law Reform Commission, viewed on September 17th 2012, < http://www.alrc.gov.au/sites/default/files/pdfs/publications/ALRC74.pdf

  • Dyson, J., 12 September 2012, ‘Apple wins but inventors will loser: Dyson’, the Age, viewed on 16 September 2012.  

  • Intellectual Property- A vital Asset for Australia, 2000. Australia: Department of Foreign Affairs and Trade.  

  • McKeough, J., Stewart, A. and Griffith, P., 2004. Intellectual Property in Australia. Third edition. Australia: LexisNexis Butterworths.  

  • Patents Act 1990 (Commonwealth of Australia), viewed on September 5th 2012, <http://www.comlaw.gov.au/Details/C2012C00423

  • Review of Crown Use Provisions in Patents and Designs Legislation Discussion Paper, December 2003, Advisory Council on Intellectual Property, viewed on September 17th 2012, < http://www.acip.gov.au/library/review%20of%20crown%20use%20discussion.pdf

  • Trade Marks Act 1995 (Commonwealth of Australia), viewed on September 4th 2012, < http://www.comlaw.gov.au/Details/C2012C00522