On 20 March 2012 the Intellectual Property Laws Amendment (Raising the Bar) Bill 2011 was passed by the House of Representatives. It is likely that the Bill will receive the Governor General’s assent and become law in the next few weeks.
The Raising the Bar Bill will make wide ranging changes to each of the Patents Act 1990, Designs Act 2003, Trade Marks Act 1995, Plant Breeders Rights Act 1994 and Copyright Act 1968. Most of these changes will not come into effect until 12 months from the date on which the Bill becomes law, however the amendment to the Patents Act which introduces new exemptions from infringement in certain circumstances will take effect immediately after assent.
These amendments introduce new sections 119B and 119C to the Patents Act, providing exemptions to patent infringement in circumstances relating to obtaining regulatory approval and undertaking experimental research.
Section 119B – Obtaining regulatory approval
The first exemption, introduced by new section 119B, means that a patent will not be infringed by acts done solely for the purpose of obtaining regulatory approval necessary to exploit a product, method or process. This exemption does not apply to pharmaceutical patents which are dealt with by existing section 119A.
The purpose of the exemption is to recognise that products other than pharmaceuticals may be delayed in being brought to market as a consequence of lengthy pre-market and pre-manufacturing regulatory approval processes. For example agricultural chemicals and certain medical devices require regulatory approval.
According to the Explanatory Memorandum to the Bill the term ‘solely’ in the new provision ensures that the exemption will not permit activities such as stockpiling the patented product for sale upon expiry of the patent, or manufacturing the product for export to another country.
There is no restriction on the type of regulatory approval for which the exemption may be used, save for the requirement that it must be imposed by law whether in Australia or another jurisdiction. The provision is intended to accommodate changes in existing regulatory requirements as well as regulatory requirements that do not currently exist, but which may be imposed in the future as new regulatory regimes are created.
Section 119C – Experimental purposes
The second exemption, introduced by new section 119C, means that a patent will not be infringed by acts done for experimental purposes relating to the subject matter of the invention. As defined in section 119C, experimental purposes include determining the properties of the invention or improving or modifying it as well as determining the scope or validity of the claims relating to the invention or whether they have
The amendment is designed to draw a line between research and commercial activities and to clarify that research and experimental activities relating to patented inventions do not constitute infringement.
It is intended that ‘experimental’ will be given its ordinary English meaning and that the exemption will apply to tests, trials and procedures that a researcher or follow-on innovator undertakes as part of discovering new information or testing a principle or supposition.
The Explanatory Memorandum states that the exemption is not limited to activities undertaken solely for experimental purposes as this would ignore the reality of the current research environment, where research is frequently undertaken for mixed purposes. For example a researcher may be contracted and paid to undertake experiments, their research may be conducted with a view to commercialising the end-products of the experimentation and may be undertaken with, and partially funded by, a commercial partner.
In such circumstances the exemption is intended to apply provided the predominant purpose is one of gaining new knowledge, or testing a principle or supposition about the invention. The exemption is not intended to apply where the main purpose of an act is to commercialise the invention, or to manufacture it for the purpose of sale or use for a commercial purpose.
For the exemption to apply, the experiments must be ‘related to’ the patented invention. This wording is intended to cover circumstances where experiments inherently include the subject matter of a patent, but the researcher is unaware of the patents existence. However, it is not intended to exempt the use of patented ‘research tools’ i.e. something that is used to facilitate an experiment, rather than something that is the subject of the experiment.
The Explanatory Memorandum provides an example of a researcher who testing the effect of a particular herbicide on different plants might use a patented wetting agent to facilitate uptake of the herbicide. In such circumstances use of the wetting agent will not be exempt from infringement, as the agent is being used as a tool and the experiments do not relate to it.
Both of these new infringement exemptions come into force on the day after assent and will apply to acts done on or after that date irrespective of whether the relevant patent was granted before or after that time.
About the Author
Partner, Phillips Ormonde Fitzpatrick Lawyers
Adrian is a lawyer and registered patent and trade marks attorney, and practises primarily in IP litigation. He has acted for Australian and overseas clients in patent infringement proceedings relating to technologies from mechanical devices to major pharmaceutical products.
Adrian has also been involved in design and copyright infringement proceedings and patent oppositions.
To find out more about the changes passed, please contact Adrian at email@example.com