Wednesday, 14th March, 2012

Senate passes Australian patent reforms

The Australian Senate passed the Intellectual Property Laws Amendment (Raising the Bar) Bill 2011 without amendment on 27 February 2012. 

The Australian Senate passed the Intellectual Property Laws Amendment (Raising the Bar) Bill 2011 without amendment on 27 February 2012. The Bill was introduced into the House of Representatives on 28 February. The changes in the Bill are subject to regulations that are yet to be published.

What are the changes?

The Bill seeks to strengthen and improve Australia's legislative framework for protecting intellectual property by giving greater certainty to both applicants and other parties.

The majority of the changes relate to the Patents Act 1990.  Other changes relate to the Trademarks Act 1995, the Designs Act 2003 and the Copyright Act 1968. 

The Bill contains six schedules.  The first schedule that relates to raising the quality of granted Australian patents is the most important for the majority of patent applicants.  The changes seek to address perceived inconsistencies in patentability standards between Australia and its major trading partners.  Some of the important changes in the first schedule are discussed below.

How is the patentability bar being raised?

The test for inventive step will change.  At present, inventive step is assessed in the light of the common general knowledge of the person skilled in the art as it existed in Australia before the relevant priority date.  The common general knowledge can be combined with prior art information that the skilled person could be reasonably expected to have 'ascertained, understood and regarded as relevant' before the priority date.  The territorial restriction that the common general knowledge of the skilled person is limited to Australia only is being removed.  The 'ascertained, understood and regarded as relevant' hurdle is also being removed.

The definition of 'useful' is being changed.  In Australia, a claimed invention needs to be useful.  Previously, Australian courts have been reluctant to revoke a patent on the ground of inutility.  Under the proposed legislation, the patent specification will need to disclose a 'specific, substantial and credible' use for the claimed invention.
The requirement for sufficiency will be more stringent.  The specification will need to disclose the invention in a manner which is 'clear enough and complete enough for the invention to be performed by a person skilled in the relevant art'.  The new wording seeks to require enablement across the full scope of the claims. 

The requirement for the claims to be fairly based on the matter disclosed in the specification is being replaced with a requirement that the claims be supported by the specification.  Previously the courts have found the requirement for fair basis was met where the claimed invention was consistent with what the body of the specification, read as a whole, discloses as the invention.  The change seeks to prevent claims that are 'broader than is justified by the extent of the description, drawings and contribution to the art.' 

The framework for examination of applications will change.  Examiners will need to examine and report on whether the claimed invention is useful (see above).  Further, examiners will be able to consider information made publicly available by the doing of an act (prior use) during examination.  Further, the balance of probabilities standard will apply to all statutory requirements for patentability that are relevant at the stage of examination (not just novelty and inventive step).

In most circumstances the amendment of a complete specification will also no longer be allowable if, as a result of the amendment, the specification would disclose matter that extends beyond that disclosed in the filed specification.
Applicants will therefore need to meet disclosure requirements at the time of filing the complete specification.  The exception of an obvious mistake or clerical error remains.  The change seeks to avoid the situation where patent rights accrue in the period before the applicant has fully described its invention. 

When will the changes come into force?

Many of the changes will come into force 12 months after the Bill receives the Royal Assent. The House will likely pass the Bill, without amendment, within the first half of 2012.  The Bill will then be presented to the Governor-General for the Royal Assent. 

The changes will apply to standard and innovation patent applications filed from the date of commencement.  The changes will also apply to standard patent applications made before the date of commencement, but where examination has not been requested before the Bill commences.

Our recommendation

We recommend Australian patent applicants consider requesting examination before many of the changes come into force (likely the first half of 2013) to take advantage of the more patentee friendly requirements under the existing legislation.

Current applicants should not wait for IP Australia to issue a direction to request examination before requesting examination.  Convention applicants may need to file corresponding applications in Australia and request examination earlier within the convention period.  Similarly PCT applicants may need to enter the national phase in Australia earlier and request examination.

Please contact us if you have questions about the changes and how they will affect you.