Following a decade of negotiations, Australia signed the Free Trade Agreement between the Government of Australia and the Government of the People's Republic of China (ChAFTA) on 17 June 2015 in Canberra. The ChAFTA builds on Australia's large and successful commercial relationship with China, which as Australia's largest trading partner, buys almost one-third of all Australian exports. Importantly, a number of significant intellectual property-related issues are set out in Chapter 11 of the Agreement.
The overall aim of Chapter 11 is to promote bilateral trade and innovation by establishing transparent systems with adequate protection and enforcement mechanisms for intellectual property (IP) rights. As a starting point, both countries have affirmed their commitment to the TRIPS Agreement (Annex 1C of the Marrakesh Agreement Establishing the World Trade Organization, a comprehensive multinational agreement which sets out minimum standards of protection to be provided by each member in relation to copyright, trade marks, geographical indications, industrial designs and patents, among others) and various other multinational IP agreements, and China has agreed to provide Australian nationals with equally favourable treatment in relation to IP protection and enforcement. Some of the general steps that China will now undertake include making its IP databases publicly available on the internet, as well as communicating reasons for any refusals to grant applications to register IP (in line with existing Australian practices for registration of IP).
The ChAFTA incorporates various commitments for specific types of IP, including:
- Trade marks - both countries agree to cooperate on appropriate means to protect not only registered trade marks, but also collective marks, certifications marks and marks that acquire protection through use/market power.
- Copyright - on this increasingly topical point, there is bilateral agreement that appropriate measures must be taken to limit the liability of Internet Service Providers (ISPs) for copyright infringement by users, particularly where the ISP takes reasonable action to prevent user access to infringing websites.
- Patent - applicants will be provided the opportunity to amend or correct applications, which must be published within 18 months of the earliest priority date claimed.
- Enforcement of IP rights - in working towards the elimination of trade in goods and services that infringe third party IP rights, the ChAFTA requires each nation to criminalise certain acts in line with the TRIPS Agreement, such as wilful trade mark and copyright infringement, and penalties must include imprisonment and significant monetary penalties.
The ChAFTA should give Australian companies, particularly those with valuable IP assets, greater confidence of improved IP protection and enforcement in China. It is expected that the innovative technology and healthcare services industries will benefit the most from these initiatives.
Chapter 11 of the ChAFTA is available here.