Additional comments from Labor Senators

Innovation patents

Labor Senators support the overall intent of this bill and recognise the need for changes to the present patents system. However, the evidence provided from a number of parties suggests a significant gap could emerge if the innovation patent is removed without alternative mechanisms being put in place to specifically assist small- and medium-sized enterprises (SMEs) to access the patent system and innovate.
Medicines Australia in their submission stated:
Australia’s innovation ranking has fallen from 20th in 2018 to 22nd in 2019 on the World Intellectual Property Organization’s (WIPO) Global Innovation Index. Consequently, there is clearly a need for Australia to develop and maintain a strong and stable intellectual property environment…1
Submitters, such as the Institute of Patent and Trade Mark Attorneys of Australia (IPTA), were concerned about the government’s failure to propose an alternative system to the innovation patent, stating:
…the Government has not provided innovative Australian businesses with an alternative system to replace the Innovation Patent System when it is phased out.2
Stakeholders suggested that the current patents system is difficult for SMEs to access and use when developing innovative products or services and engaging in smaller scale research and development. The Australian Small Business and Family Enterprise Ombudsman proposed reforms to enable these issues to be addressed through the standard patent:
In light of the Government's decision to proceed with the abolition of the innovation patent system, this Office encourages the Intellectual Patent Australia (IPA) to consider ways in which the standard patent system can be administered in such a way that it is made easy for small business to use. This should include the establishment of a dedicated small business support service that provides education and training, improved navigability, reduced fees, truncated patent assessment processes and access to simplified dispute mechanisms.3
IP Australia also stressed the likely benefits to SMEs arising from simply making more regular standard patent applications should the innovation patent be phased out.4 The legislation, however, does not make the application process or cost for standard patents easier for SMEs, and it does not make any changes to the standard patent process to account for the incremental innovation gains often secured by smaller businesses.
It is these concerns held by Labor Senators that suggest a real gap is being created by the bill where the innovation patent system once stood.
Although Ai Group supports the retention of the innovation patent, they did make a pertinent point in their submission regarding the ultimate outcomes that need to be sought:
While the Innovation Patent has been and remains a useful tool for businesses, ultimately it is the commercial and economic outcomes this tool delivers that we need to secure and build on. As in 2018, we strongly submit that abolition should not proceed until and unless reforms are in place to ensure that intellectual property law meets the commercial needs of innovative SMEs and fully supports Australia's economic prosperity by providing a suitably affordable, flexible and accessible alternative. Government should work closely with affected businesses to find pathways to this outcome, rather than proceeding with an abolition.5
The committee report addresses some of the issues in paragraphs 2.77 and 2.78, but they do fall short.
Labor Senators urge the government to immediately address the need for greater support for Australian SMEs in protecting their intellectual property through the standard patent when the innovation patent is abolished.
In the government’s response to the Productivity Commission Inquiry into Intellectual Property Arrangements, they expressed that the innovation patent failed in its objective to stimulate innovation for Australian SMEs and that targeted assistance would better achieve that objective.6
Labor Senators urge the government immediately make public the 'targeted assistance' that will stimulate innovation for Australian SMEs.
Senator Alex GallacherSenator Jenny McAllister
Deputy ChairSenator for New South Wales

  • 1
    Medicines Australia, Submission 35, p. [1].
  • 2
    IPTA, Submission 50, p. 1.
  • 3
    Australian Small Business and Family Enterprise Ombudsman, Submission 1, p. [1].
  • 4
    IP Australia, Submission 5, p. 2.
  • 5
    Ai Group, Submission 46, p. 2.
  • 6
    Australian Government, Response to the Productivity Commission Inquiry into Intellectual Property Arrangements, August 2017, p. 10.

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