The Final Report (three years in the making) of ACIP’s Review of the Innovation Patent System was released on 16 June. You can download the full report here.

The key points are as follows:

  • ACIP explored three options for the innovation patent system – no change, abolition of the system, and change the system. ACIP has been unable to obtain  adequate empirical evidence as to whether the system does or does not stimulate  innovation in Australian SMEs.
  • ACIP is therefore unable to make a recommendation on whether to retain or  abolish the innovation patent system. Evidence is available to support changes to  the system. If the government chooses to retain the system, then ACIP urges it to  consider various recommendations in this report to enhance its effectiveness and to  reduce some of the system’s unintended consequences.
  • ACIP recommends amending the Patents Act 1990 (Cth) to raise the level of  innovation to a level above the current innovative step level, but below the  inventive step level that applies to standard patents. A suitable level of innovative  step would be provided by the test of inventiveness described by the High Court of  Australia in Minnesota Mining & Manufacturing Co v Beiersdorf (Australia) Ltd  [1980] HCA 9: (1980) 144 CLR 253; (1980) 29 ALR 29 with a modification to that  test to include the current definition of what is relevant CGK. In order to be  innovative an invention would need to be non-obvious by reference to CGK either  within or outside the patent area but not by reference to prior art information that is  not part of CGK at the priority date of the relevant claims of the innovation patent.  This would be a lower threshold than is applied to standard patents, where the  invention must be non-obvious by reference to the CGK and any piece of prior art.
  • ACIP recommends amending the Patents Act 1990 (Cth) so that substantive  examination must be requested before the third anniversary of the lodgement of  an innovation patent. This will allow sufficient time for a patentee to evaluate the  commercial potential of their innovation patent before they are called on to commit a  reasonable investment in protecting their IPR.
  • ACIP recommends amending the Patents Act 1990 (Cth) so that the term ‘patent’  is only used for innovation patents that have been examined and certified. There  is a general perception within the broader community that a ‘patent’ has some form of  legally-enforceable right. Perhaps the right could be called an ‘innovation application’  up until the time that certification occurs.
  • ACIP recommends amending the Patents Act 1990 (Cth) to exclude all methods,  all processes and all systems from being patentable inventions for the purposes of  an innovation patent. This would better align the innovation patent system with the  legal systems of most countries including the large majority of Australia’s major  trading partners. It would also address concerns about the effect of innovation patents  for methods, processes and systems for implementing what are, in effect, business  methods.
  • ACIP recommends that, subject to the preceding recommendations being  accepted, the remedies for infringement of an innovation patent remain  unchanged. ACIP considers that the existing remedies are suitable for a future innovation patent given the raised level of innovation and additional excluded subject  matters. ACIP also endorses the current practice whereby courts consider exploitation  by the patent holder as a key consideration in any application for an injunction.