On 30 May 2013, the Intellectual Property Laws Amendment Bill 2013 was introduced into Parliament. The Bill proposes amendments based on the Productivity Commission's 2013 Report into Compulsory Licensing of Patents, which was released on 27 May 2013.

Of particular interest to agencies are the proposed changes to the Crown use provisions.

What's wrong with the current Crown use provisions?

The Patents Act 1990 permits the Commonwealth or a state to access patented inventions for the services of the Commonwealth or the State, without infringing the patent.

The Productivity Commission noted two main issues with the current Crown use provisions:

  • the uncertainty of who is the Crown and what constitutes "for the services of the Commonwealth or the State", and
  • the need to improve transparency and accountability when it is used.

Proposed changes

The Bill proposes to amend the Patents Act to:

  • clarify that Crown use can be invoked for the provision of a service that any Commonwealth, state or territory governments (or their authorities) has the primary responsibility for providing or funding
  • require the Crown to attempt to negotiate with the patent owner before invoking the Crown use provisions
  • at least 14 days before the use, require that the Crown use have prior Ministerial approval and the Minister provide the applicant and the patentee with:
    • notice of the Minister's approval, and
    • a statement of reasons
  • insert emergency provisions (e.g. in a pandemic) where the Crown is not required to attempt prior negotiation or provide the statement of reasons prior to the use, and
  • amend the remuneration payable for Crown use to align more closely with the compulsory licencing provisions.

What happens next?

If passed, the Bill will bring more certainty to the area of Crown use under the Patents Act. However, it does so by limiting the availability of the exception and by requiring agencies to comply with a process that, except in the case of emergencies, must be undertaken before the use occurs.

Accordingly, agencies will need to identify circumstances where the carrying out of government services may constitute Crown use and comply with the legislative requirements early on in the process, rather than relying on the current provisions that allow you to provide the services and deal with any Crown use requirements later.

It is also likely that a similar regime will be introduced for other areas of intellectual property that have Crown use provisions, for example, copyright. We will continue to keep you informed of any further developments.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.