The Productivity Commission’s long awaited final report into Intellectual Property was released by the Government yesterday and with a final consultation period that closes on 14 February 2017, we still have some time to go before seeing any real outcomes.

The report, which examines Australia’s Intellectual Property (IP) system in detail and makes recommendations to improve its operation, is the result of Productivity Commission’s extensive inquiry which commenced in August 2015 and has included over 600 submissions and four roundtables, six public hearings and over 800 research references.

Not surprisingly, the Commission’s recommendations, as far as they relate to copyright, have already been heavily criticised by various bodies, including Screen Producers Australia (SPA), Screenrights and the Australian Performing Rights Association (APRA). Although other groups, reportedly including Universities Australia, have welcomed the report.

One thing that is unlikely to cause too much surprise is the view, expressed in the report, that IP protection regimes don’t necessarily reflect how users engage with and use protected content. This leads to relatively controversial conclusions with regard to geoblocking and how current arrangements should be altered. But shouldn’t the rights holder get to determine how their product is consumed? Should the tail really wag the dog?

The recommendations of the report have been summarised as follows:

  • Australia’s intellectual property (IP) arrangements fall short in many ways and improvement is needed across the spectrum of IP rights.
  • IP arrangements need to ensure that creators and inventors are rewarded for their efforts, but in doing so they must: – foster creative endeavour and investment in IP that would not otherwise occur – only provide the incentive needed to induce that additional investment or endeavour – resist impeding follow–on innovation, competition and access to goods and services.
  • Australia’s patent system grants exclusivity too readily, allowing a proliferation of low quality patents, frustrating follow–on innovators and stymieing competition. – To raise patent quality, the Australian Government should increase the degree of invention required to receive a patent, abolish the failed innovation patent, reconfigure costly extensions of term for pharmaceutical patents, and better structure patent fees.
  • Copyright is broader in scope and longer in duration than needed — innovative firms, universities and schools, and consumers bear the cost. – Introducing a system of user rights, including the (well-established) principles–based fair use exception, would go some way to redress this imbalance.
  • Timely and cost effective access to copyright content is the best way to reduce infringement. The Australian Government should make it easier for users to access legitimate content by: – clarifying the law on geoblocking – repealing parallel import restrictions on books. New analysis reveals that Australian readers still pay more than those in the UK for a significant share of books.
  • Commercial transactions involving IP rights should be subject to competition law. The current exemption under the Competition and Consumer Act is based on outdated views and should be repealed.
  • While Australia’s enforcement system works relatively well, reform is needed to improve access, especially for small– and medium–sized enterprises. – Introducing (and resourcing) a specialist IP list within the Federal Circuit Court (akin to the UK model) would provide a timely and low cost option for resolving IP disputes.
  • The absence of an overarching objective, policy framework and reform champion has contributed to Australia losing its way on IP policy. – Better governance arrangements are needed for a more coherent and balanced approach to IP policy development and implementation.
  • International commitments substantially constrain Australia’s IP policy flexibility. – The Australian Government should focus its international IP engagement on reducing transaction costs for parties using IP rights in multiple jurisdictions and encouraging more balanced policy arrangements for patents and copyright. – An overdue review of TRIPS (trade-related aspects of intellectual property rights) by the WTO (World Trade Organization) would be a helpful first step.
  • Reform efforts have more often than not succumbed to misinformation and scare campaigns. Steely resolve will be needed to pursue better balanced IP arrangements.

Next Steps

The Government is now considering its response to the final report and invites stakeholder views on issues raised in that report that stakeholders may not have had the opportunity to comment on, or in areas where they wish to provide additional views. This phase of consultation is open until 14 February 2017.

The Government will then respond formally to the report in mid-2017.

Please click here to read the full report.