New ACIP issue paper on a ‘Review of the Innovation Patent System’

In recent years, the Advisory Council on Intellectual Property (ACIP) has been conducting a number of reviews and issued corresponding papers on IP reform in Australia.

On 17 August 2011, ACIP issued a paper calling for submissions on its next review concerning the Innovation Patent
system.

The closing date for submissions for review is 14 October 2011.

The Innovation patent system is a unique system in the global IP arena.

At its heart, the innovation patent system offers a second-tier patent enforcement regime to the standard patent system. The innovation patent requires the satisfaction of an ‘innovation step’ test, which is considered and intended to be a lower threshold than the ‘inventive step’ test required for a standard patent. The trade-off for this lower threshold test being that the maximum term of an innovation patent is less than that for a standard patent – 8 years as opposed to 20 years. However, there have been criticisms that, while for a shorter term, the innovation patent offers the same level of infringement enforcement as a standard patent, although is much harder to counter due to its lower validity threshold requirements.

The innovation patent has been criticised as being overly generous to patent owners and open to abuse. The innovation patent is much more encompassing in terms of what subject matter it can provide patent protection for when compared with other second-tier patent mechanisms offered in some other countries (notably utility models provided in Germany, China, Japan and Korea).

The innovation patent can also offer a quick enforcement strategy while a parallel standard patent application is
pending, due to the quick turnaround times offered for the progress of innovation patents by IP Australia. Such strategic uses may not have been originally intended and foreseen, however the system has been exposed to quite
valid strategic uses in this regard.

The review paper is being expansive enough to ask radical questions such as whether a second-tier patent system in
Australia is still required and, if so, should a utility model system, as used elsewhere, be adopted.

Realistically, we are unlikely to see reform of such magnitude occur.

In the current Australian patent climate, the standard patent system is on the verge of significant legislative reform to ‘raise the bar’. This would potentially further the validity threshold gap between the innovation patent system and the standard patent system.

The ACIP paper does propose amendments to raise the bar of the innovation patent system to close the perceived gap which will occur following the pending changes to the standard patent system. If anything, this is likely to be where the ACIP paper may be more likely to effect change.

by Simon Ellis

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