Australia | Design protection: IP Australia's bold reforms for the Digital Age

Following a review of the Australian design sector in 2020, IP Australia proposed wide-reaching changes to the Design registration regime and embarked on a public review of these proposals. A recently released paper from IP Australia provides insight to the likely changes ahead, particularly for virtual designs. We look at the key changes and feedback received, including IP Australia's subsequent views.

IP Australia Design Review

In order to better understand the main drivers of design innovation in design-related industries, and whether any changes to the current registered design system could be beneficial, IP Australia conducted a review in 2020.

The review showed that economic activity in design-related industries is substantial, yet only a small number of businesses held registered design rights. This suggests that the Australian registered design system is being underutilised.

In response to the review, IP Australia concluded that the Australian registered design system could benefit if it was reformed to allow protecting:

• virtual designs
• partial designs, and
• incremental designs.

Proposals to implement these changes were set forth by IP Australia for public review, and from 13 June to 13 August 2023, IP Australia conducted a public consultation on the proposed reforms.

As a result of the consultation, IP Australia released a summary of the feedback received on the various proposals and indicated IP Australia's views on the issues raised. This article discusses the feedback and how IP Australia will move forward.

Virtual designs

A virtual design refers to designs which have no physical form, such as a graphical user interface (GUI) or an icon.

There is currently uncertainty as to whether a virtual design can be validly registered and enforced in Australia, because the Australian Designs Office has taken the position that:

"Logos, type-fonts and software such as graphical user interfaces are not considered to be 'products'. They do not meet the definition of 'product' under Australian law, so on their own they cannot be registered."¹

Further, the Australian Designs Office has also taken the position that during examination the visual features of a design must be considered when the product is "at rest" (i.e. an electronic product would be off). This means that visual features such as user interfaces or icons would not be visible when the product embodying the design is "at rest".²

However, there has been no Court decision to confirm or refute the Designs Office position.

IP Australia proposes to remove the uncertainty in the current system and expand registered design rights to explicitly include protection for virtual designs. This proposal was broadly supported by stakeholders.

Proposals and feedback received

In their consultation paper, IP Australia proposed changes to the definitions of "product" and "visual features" in the Designs Act 2003 (Cth), as well as allowing applications to indicate dynamic features of virtual designs (e.g. using a written statement, numerical sequences, and/or various representations) and amending infringement provisions to ensure customers or end users of virtual products are not liable for infringement (e.g. by downloading a computer program from a distributor's website to a computer).

Whilst stakeholders agreed that the definitions of "product" and "visual features" would need to be amended, some considered IP Australia's proposed definitions to be unnecessarily limiting or adding ambiguity. IP Australia will refine these definitions in response to the feedback.

Stakeholders also proposed the incorporation of animations or videos to show dynamic features of a design, which was favourably received by IP Australia.

Stakeholders also suggested introducing the concept of "contributory infringement", which was also favourably received by IP Australia.

Key proposed changes

• The definition of "product" in the Designs Act 2003 (Cth) would be amended to incorporate a definition of "virtual product".
• The definition of "visual feature" in the Designs Act 2003 (Cth) would be amended to ensure features of a product in its "active" or "on" state can be incorporated.
• Video files or animations showing dynamic features of a design would be allowed to be submitted with an application as optional, supplemental, information.
• Infringement provisions would need to be amended to ensure seller of a virtual product is liable for infringement, but not the customer or end user. This may involve introducing "contributory infringement" provisions and adding exceptions to infringement for certain "reasonable" uses of a virtual design (e.g., study, correcting errors, back up, testing, etc.).
• A "carve out" of the Copyright Act 1968 (Cth) and Designs Act 2003 (Cth) "overlap" provisions to ensure that that virtual works do not lose copyright protection due to the availability of design registration.

Partial designs

Unlike its major trading partners, Australia's registered design system does not allow the protection for parts or portions of products (e.g., the handle of a cup). Instead, a product is considered as a whole, and it is only possible to emphasise or deemphasise certain features by using, for example, segmented lines and/or by highlighting certain parts in the Statement of Newness and Distinctiveness.³

IP Australia proposes to change the registered design system to include protection for partial designs.

Proposals and feedback received

In their consultation paper, IP Australia's main proposals included amending the definition of a design to incorporate parts of a product, introducing a "clarity" requirement, and abolishing the Statements of Newness and Distinctiveness (SOND) in favour of a non-mandatory written claim.

These proposals were mostly well received, but some stakeholders suggested a written claim should only be optional and there were mixed views about the abolishment of the SOND.

Also proposed was changing the standard required to identify the product to which a partial design registration is applicable, limiting the prior art base for infringing products for partial designs to "similar" products, and allowing for some consideration of "disclaimed" or "unclaimed" features when assessing substantial similarity.

There was some pushback against these proposals, as some stakeholders considered that they could give partial designs stronger rights compared to designs for whole products.

Key proposed changes

• Expand the current definition of design to include partial designs. A partial design would be defined as "the overall appearance of a part of a product resulting from one or more visual features of that part of the product".
• IP Australia proposes the use of visual indicators (for example, segmented lines, colouring, shading, etc.) and a written claim to specify to what parts of the product the partial design relates to. The written claim would be optional.
• Introduction of a "clarity" requirement. The scope of protection sought in a design application must be clear to the familiar person, considering the representations and any written claim.
• Unclaimed or disclaimed features should be considered for limited purposes when assessing validity or infringement. Namely, understanding what the claimed part is for and where it might be found on comparable products.
• Statements of Newness and Distinctiveness (SONDs) would be abolished in view of the inclusion of an optional written claim, which may be amendable at relevant points during the term of protection.
• Maintaining existing test for infringement of whole designs to registered partial designs.

Incremental designs

Products, and the designs embodied in those products, are generally developed in an incremental or iterative process, often with many rounds of prototyping, testing and redesigning before a product is finished. This process is often perceived as being incompatible with the operation of the registered design system, under which there is little flexibility to modify a design once an application is filed. This may lead to underutilisation of the registered design system.

To improve this, IP Australia proposed two new mechanisms to protect designs as they develop during their lifecycle:

• preliminary designs; and
• post-registration linking.

Preliminary designs

A preliminary design would allow an applicant to file an initial low-cost application to establish a priority date and, within 6 months, file a main application. The main application may have incremental changes to the design in the preliminary design application.

However, stakeholders identified several issues with the preliminary design proposal, foreseeing difficulties for Australian applicants to obtain protection overseas, as preliminary designs may not provide an adequate basis to claim convention priority in an overseas application.

Additionally, it may be difficult for an applicant to determine before filing if a main design would be sufficiently similar to a preliminary design so as to benefit from this proposal. A further issue raised was that applicants could attempt to stifle innovation by creating design thickets (filing large numbers of main designs applications for similar designs), or by using a main design strategically to capture specific competitors after a preliminary design is filed.

In response to the feedback, IP Australia decided not to progress the proposal for preliminary designs as this stage.

Post-registration linking

Post-registration linking would allow applicants to file a main design application and subsequently file another application with incremental improvements over the main design and "link" both applications such that the main application could not be used as prior art to invalidate the subsequent application.

Proposals and feedback received

In their consultation paper, IP Australia proposed that a subsequent design could be linked to an earlier design if it is substantially similar to the earlier design, with no limit on the number of designs which could be linked. The term of a subsequent application would be limited to the term of the earliest design in a chain of linked applications.

Most stakeholders supported the proposal, but some raised concerns that applicants could use post registration linking to file a large number of subsequent design applications in an attempt to expand their monopoly and create design thickets. In reply, IP Australia was of the view that the ability to create an expanded monopoly would be limited because the subsequent designs would need to be substantially similar to the main design.

There were also concerns about the additional complexity and administrative burden that would be introduced, and some stakeholders suggested that the reduced term of subsequent designs may reduce the incentive to use post registration linking.

In response to the feedback, IP Australia's proposal was refined to increase the term of linked designs in some cases, and to reduce complexity and administrative burden.

Key proposed changes

• Linking would only be allowed at examination or during court proceedings.
• A subsequent design for the same product must be substantially similar in overall impression to a main design.
• Design applications with identical designs, but for different products (e.g., a virtual and a physical product), could be linked so as to allow applicants to pursue protection for both the physical and virtual forms of a design.
• The term of a subsequent application would be limited to 10 years from the filing date of the earliest linked design that is substantially similar to it (instead of the first design in the chain).
• Ownership of a main and a subsequent design must be the same at the time of linking and afterwards.

Next Steps

The outcomes of the consultation have been reported to the Australian Government which is now considering legislation to implement the proposals. Further consultation may take place if legislation proceeds.

Looking forward

Overall, these proposed changes should be beneficial to designers and result in a broader utilisation of the registered design system.

The introduction of virtual designs and partial designs would align the Australian registered design system more closely with that of its main trading partners. This should benefit both local designers seeking to protect their works as well as foreign applicants seeking to pursue in Australia a similar scope of protection to that obtained overseas.

The proposal for post-registration linking should also be beneficial to applicants, but may introduce significant complexity to the system, requiring careful consideration of filing strategies. For assistance and strategic guidance at any stage of your design innovations, reach out to our expert team in Australia.

Footnotes

¹ Designs Examiners' Manual of Practice and Procedure at part 10.5. Product: Product name.
² Designs Examiners' Manual of Practice and Procedure at part 9.4. Identifying the design: Variable visual features; Apple Inc [2017] ADO 6.
³ GH PTM Pty Ltd trading as Griffith Hack v Clipex IP Limited [2022] ADO 3 (5 August 2022) at [38]­-[39].

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.