What, exactly, is the purpose of the patent system? That simple, but profound, question lies at the heart of two recent proposals to amend the Australian Patents Act: by including an Objects Clause in the legislation; and by introducing an exclusion from patentability on ethical grounds.

At the outset I must declare my connection with the proposals. They arose from a 2010 review of Patentable Subject Matter conducted by the Advisory Council on Intellectual Property, of which I was then the Chair. The government accepted ACIP’s recommendations, and is now consulting on the form of their implementation.

The fuller of the two proposed versions of the Objects Clause states that the purpose of the patent system is to enhance the well-being of Australians by promoting innovation and the dissemination of technology and by balancing the competing interests of patent applicants and patent owners, the users of technology, and Australian society as a whole. It highlights the economic and social welfare goals of the patentn system, and recognises the competing, and at times conflicting, interests of the system’s stakeholders.

The proposed ethical exclusion applies to inventions the commercial exploitation of which would be wholly offensive to the ordinary reasonable and fully informed member of the Australian public. A careful reading shows that its operation is constrained.

Contrary to what some think, it does not exclude from patentability “immoral inventions” (whatever they may be). Rather, it excludes only those inventions the commercial exploitation of which would be wholly offensive.

The exclusion’s focus on the offensiveness of the commercial exploitation of the invention, rather than on the invention itself, is appropriate. A patent grants the exclusive right to commercially exploit the invention. It would be inconsistent to grant a patent for an invention – and, thereby, the exclusive right to commercially exploit it – where its commercialexploitation would be offensive to the public.

While the ethical exclusion is the more controversial of the two proposals, the Objects Clause is likely to have the greater practical impact. It is more than a mere “motherhood” statement. As an aid to legislative interpretation, it will be taken into account when fundamental issues – such as what should and should not be patentable, and what are the boundaries of a patent’s exclusive rights – are under consideration. It can be expected that the ethical exclusion will come into play only rarely. But, in the extreme situation where commercial exploitation of an invention would be wholly offensive, it is only right that no patent be granted for it.

So, what, exactly, is the purpose of the patent system? These proposals tell us it is to enhance economic and social welfare through promoting innovation while balancing competing interests in an ethical manner. That’s a purpose I’m happy to keep serving.