Reviewed protection

20 December 2016

The Productivity Commission's final report on its inquiry into Australia's Intellectual Property (IP) Arrangements has been released for consultation.

The Productivity Commission (PC) is looking into the current balance of access to ideas and products against protecting intellectual property.

To this end it considers:

• the scope and duration of current intellectual property protection; and
• how current arrangements could be improved while observing Australia's international trade obligations.

The inquiry was a key recommendation of the Government's Competition Policy Review (Harper Review).

Changes to the Australian intellectual property system have been ongoing amid a rapidly developing global economic and technologic environment.

In 2013, the IP Laws Amendment (Raising the Bar) Act 2012 came into full effect.

But despite these major changes, the PC argues that Australia's patent system remains tipped in favour of rights holders and against the interests of the broader community. Australia's system provides stronger patent rights than most other advanced economies, and there are a multitude of low-value patents that frustrate other innovators and researchers who need to find costly workarounds.

Key points detailed in the report include:

• reforms to the inventive step, which also has been the target of the Raising the Bar legislation, but according to the PC could be further aligned with thresholds applied in the US and the EU;
• improving the evidence base used in the patent approval process, including by requiring applicants to identify the technical features of their invention.
• setting different patent fees, such as renewal fees to reduce the risk of patents being used strategically (the PC argues that as a policy lever renewal fees are at present underutilised).

A special target area of the PC inquiry are Pharmaceuticals, a sector that relies on significant research investments. For example, Australian pharmaceutical companies can qualify for additional periods of protection after the initial 20-year period that applies to all patents.

However, the PC argues that the extensions have had little effect on investment and innovation. This also because Australia's investment in pharmaceuticals represents a meagre 0.3% of global spending on pharmaceutical R&D research.

The report is open for comments until 14 February 2017. Details about providing further feedback on the final report are available at: https://consultation.business.gov.au/Consultation/