Australia: Government accepts the need for prompt legislative reform to Australian designs law

Last Updated: 1 July 2016
Article by Caroline Bommer

The Australian government has finally published its response to the three year long ACIP Review of the Designs System, which culminated in a Final report released May 2015 which we discussed in an earlier article which can be accessed here. While the response accepts many of the 23 ACIP recommendations outright, many of the responses are contingent, at least in part, on the outcome of separate investigations by IP Australia and/or the Australian Productivity Commission.

Since the government response on designs published early last month, the Australian Productivity Commission has also released a draft report for consultation that includes comments regarding the current designs system. The Commission was tasked with assessing Australia's current intellectual property framework, with the objective of maximising the wellbeing of the Australian community as a whole. The resulting draft report is commercially unrealistic and strongly anti-intellectual property in all its forms. In essence it advocates curtailing rights, or where certain rights have to be provided, setting the highest possible bars to eligibility, coupled with the shortest possible terms and increased fees. Further commentary on the draft report from the Productivity Commission can be accessed here.

It now remains to be seen how the government will react to the final recommendations from the Productivity Commission, which are due to be released in a final report over the coming months, and how this will affect the plans and timeline for designs reform as set out in the government's published response.

The paragraph below summarises some of the key recommendations for change accepted by government. This is followed by a summary of some of the key features the government have indicated are to remain the same, after which is provided a summary of a few of the provisions and recommendations that may be affected by one or more of: the views of the Australian Productivity Commission; a current fee review, and any final decision regarding accession to the Hague Agreement.

Government accepted recommendations for change or ongoing investigations include:

  • Introduction of a grace period together with a prior user defence (details to be determined via further consultation);
  • Amendment of terminology for a registered but uncertified design so as to clarify when a design is enforceable;
  • Promoting efforts to harmonise and streamline procedures for acquiring international design rights;
  • Investigation of the implications of Australia joining the Hague Agreement and continued monitoring of usage by major trading partners;
  • Remove the option of the publication regime as an alternative to registration;
  • Investigating taking steps to ensure the Designs Act and relevant Copyright Act overlap provisions are consistent with each other; and
  • Continued active involvement in promoting harmonisation of international filing requirements through development of the Designs Law Treaty (DLT).

Provisions to remain unchanged include:

  • Designs Act to retain requirement of distinctiveness and section 19 provisions;
  • Protection to continue to relate to visual appearance of the whole product for the present time;
  • No plans to introduce protection for unregistered designs;
  • No border protection measures to be introduced (contrary to ASIC recommendation);and
  • Leaving the infringement provisions under section 71 as they are.

Recommendations subject to a future decision regarding joining the Hague Agreement include:

  • Extending the term to 15 years;
  • Consider requiring request for examination by first renewal deadline at 5 years;
  • Considering a post certification opposition system;
  • Considering aligning criteria for eligibility of designs for inclusion in a multiple design application with relevant treaties and trading partners.

Options and issues awaiting input from the final report of the Productivity Commission include:

  • Whether extension of term to 15 years under Hague is recommended;
  • Assessing whether specific considerations should be provided for the treatment of virtual or non-physical designs; and
  • Assessing whether allowing partial product registrations would benefit Australian interests.

To date the draft report of the Productivity commission does not support any of these proposed changes. It also recommends against introduction of a grace period, and generally concludes that there is a lack of evidence that design rights generate any net benefits to Australia. It will therefore be interesting to see whether the government will be influenced by these conclusions if they are retained in the final report.

In the meantime the government response indicates that it plans to continue investigations and consultations relating to a number of important areas such as:

  • Providing automatic publication at six months after the filing date, with the possible option to request earlier publication, with an amendment to the innocent infringer defence provisions;
  • Enabling amendment of the Statement of Newness and Distinctiveness post registration (provided it doesn't broaden the scope of the design owner's right);
  • Looking at reduced fees for additional designs in multiple design applications;
  • Providing legislated grace periods for renewal deadlines to align with other IP rights;
  • Ensuring exclusive licensees have the right to bring proceedings for infringement; and
  • Extending ground for revocation on basis of fraud etc to fraud etc, during certification and not just registration.

While it seems probable that the changes to remove the option of publication without registration, and the introduction of grace periods for renewals, may be introduced in the forthcoming Intellectual Property Laws Amendment Bill, it may still be some time before any of the more urgent and more desirable substantive changes come into effect, if at all. In this regard we hope that the generally positive stance the Government has taken in response to the ACIP report, which should help improve the current system, is not adversely affected by the unsupportive feedback from the Productivity Commission as published to date.

A full copy of the government's response can be accessed here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Shelston IP ranked one of Australia's leading Intellectual Property firms in 2015.

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Caroline Bommer
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