Significant Changes to the Patents Act 1990

This article first appeared in The Watermark Journal Vol 23 No 2 (June 2006)

In the last week of March, the Australian Federal Government introduced into parliament the Intellectual Property Laws Amendment Bill 2006. While the bill addresses a number of the intellectual property laws of the country, the most significant of these are to the Patents Act 1990.

It is not likely that these proposed changes will pass the legislature quickly, most especially because at this time of the year the Government is focused on the annual budget bills. However, it is likely that the Intellectual Property Laws Amendment Bill 2006 will come into force before the end of the calendar year.

A brief summary of the proposed changes to the Patents Act 1990 is provided here. 

• A broader springboarding provision is proposed under a new section 119A. (Section 78(2) would be repealed). Protection against infringement would be provided for any person who takes steps to obtain entry of a patented pharmaceutical product on the Australian Register of Therapeutic Goods, or any similar register overseas at any time during the life of the patent. Previously, such protection was only provided between the date the extension of term is granted and the extended expiry date. Note that export of the patented pharmaceutical is not proposed to be protected by the amendments, except during the extended term of the patent. Only acts occurring after the commencement of the Act in relation to patents in force at the time will be encompassed by this amendment.
• The scope of s119 of the Patents Act 1990 has been in some doubt. The amendments seek to clarify the scope of the prior user defence. Any means of exploitation in Australia that would be an infringement but for the defence is proposed to be protected. The rights acquired by being a prior user would be assignable. The expanded defence would only be available in respect of patents filed on or after commencement of the Act.
• A new section 122(1A) is proposed that would allow, in addition to compensatory damages or an account of profits, the award by a Court of exemplary or punitive damages for infringement. Factors such as the wilfulness of the infringement, the conduct of the infringer and the need to set an example are identified as relevant to the Court’s decision. Infringements occurring after the date of commencement of the Act will be subject to the award of such damages.
• In addition to the traditional factor for determination of a compulsory licence (the inability of the patentee to satisfy reasonable market requirements and the inability to come to terms with a willing licencee), it is proposed to introduce a new leg to s133(2) that would also trigger the grant of a compulsory licence. This new requirement would be determined on the basis of the patentee’s failure to comply with Australian competition law under the Trade Practices Act 1974. Only conduct occurring after the amendments will be encompassed by the changes.

Further information, to the extent it is available, can be obtained from any Watermark attorney.