Productivity Commission Releases Extensive Report on Intellectual Property

Thursday 22 December 2016 @ 10.22 a.m. | IP & Media

The Productivity Commission has released its final report on Australia’s intellectual property system.  As foreshadowed by its draft report, released in April this year, the Commission has recommended a large number of controversial changes to Australia’s intellectual property arrangements, including introducing a “fair use” system for copyright similar to that of the United States, as well as loosening parallel import restrictions on books published overseas and raising the inventive standard needed to gain a patent.

The Productivity Commission was asked by then-Treasurer Joe Hockey to conduct a 12 month review of intellectual property arrangements in 2015, following a recommendation made in the Harper Review.  An issues paper was released on 7 October 2015, followed by a draft report on 29 April 2016, before the inquiry report was released on 20 December 2016.

A joint media release issued by the Minister and Assistant Minister for Industry, Innovation and Science described the public consultations undertaken by the Productivity Commission as “extensive”, saying it “included over 600 submissions and four roundtables, six public hearings and over 800 research references.”  According to the Ministers, the Turnbull Government “will consider its recommendations and undertake further consultation with stakeholders prior to a response in mid-2017.

The Productivity Commission has clearly anticipated that its suggestions will be controversial.  A strongly worded paragraph in the report says:

“… achieving reform will not be easy. Some vocal interest groups have long shaped Australia’s IP arrangements to advance their own interests. And in the past, reform efforts have more often than not succumbed to misinformation and scare campaigns. The same tactic has been deployed here, with some parties publishing more fiction than fact about the Commission’s draft report. Government will need to show steely resolve to pursue a better balanced IP system in the face of strong vested interests.”


The Productivity Commission report makes a number of recommendations, which include:

  • Increasing the degree of invention required to receive a patent;
  • Abolishing the innovation patent system;
  • Lowering the cost of extensions of term for pharmaceutical patents;
  • Restructuring patent fees so that they rise each year at an increasing rate, while reducing the initial threshold for claim fees;
  • Shortening the duration of copyright and limit its scope;
  • Introducing a “fair use exception” to copyright in line with recommendations made by the Australian Law Reform Commission;
  • Limiting the liability for “orphan works” where no relevant rights holder can be identified;
  • Clarifying legislation around “geo-blocking” by specifically allowing consumers to circumvent geoblocking technology;
  • Removing parallel import restrictions on books by the end of 2017;
  • Removing the current exemption of IP rights under competition law;
  • Introducing a specialised IP list within the Federal Circuit Court to provide a timely and low cost option for small and medium sized businesses to resolve disputes;
  • A push for the World Trade Organisation to review TRIPS;
  • Reviewing the governance and transparency arrangements for collecting societies;
  • Reducing the period before new trade marks registration can be challenged for non-use  from 5 years to 3 years; and
  • Expanding the “safe harbour scheme” to cover all providers of online services.

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