Feedspot’s Top 25 Australian Law blogs

Honoured to be included in Feedspot’s Top 25 Australian law blogs and websites for Australian lawyers.

No 1 is Melbourne Uni’s Opinions on High which is a “must read” for following developments in the High Court.

K & L Gates’ IP Law Watch, which includes posts about Australian law as well as the USA, the UK and EU comes in at No. 10.

There are also two competition / consumer law blogs which I should check out.

AIPPI Sydney 3 – sufficiency

My attempt to summarise Parma Session 1 ‘Sufficiently plausible’ has been posted on IPKat here.

Clare Cunliffe’s report on the session about IP and competition is here.

Google gets EUR2.43 billion fine

The European Commission has fined Google EUR2.43 billion (approx. AU$3.6 billion) for misusing its market power over internet searches.

According to the Commission, Google has over 90% market share for internet searches in the EU.

The Commission found that Google had abused this dominant position in internet searching by promoting results for its own Google comparison shopping service over results for competing comparison shopping services.

At this stage, the Commission’s press release and Factsheet are available.

While this is no doubt the start of a long legal process, Ben Thompson at Stratechery has an interesting, succinct analysis of the application of competition rules to Internet players here which is well worth reading.

Productivity Commission reports on IP (in draft)

The Productivity Commission has released its draft report into Intellectual Property Arrangements.

You will be startled to learn that the Productivity Commission has discovered Australia is a net importer of intellectual property. We buy more IP from the rest of the world than we sell to it. Fig. 2 in the Report indicates Australian IP earned AUD1 villion from overseas, but we paid out about AUS4.5 billion for the use of their IP. The Productivity Commission then notes that we provide surprisingly strong IP protection for a country in our position.[1] This finding guides the Productivity Commission’s recommendations which might broadly be characterised as: take the least restrictive option in terms of IP protection (where our international obligations permit).

The Productivity Commission explained its position this way:

Intellectual property (IP) arrangements need to balance the interests of rights holders with users. IP arrangements should:[2]

• encourage investment in IP that would not otherwise occur;

• provide the minimum incentives necessary to encourage that investment;

• resist impeding follow-on innovation, competition and access to goods and services. (emphasis supplied)

So, for example, after much gnashing of economists’ teeth about the (let’s face it, indefensible) term of copyright protection, the Productivity Commission considers that the appropriate term of protection is somewhere between 15 and 25 years.[3] However, what it actually recommends is rather more limited:

4.1: remove the current unlimited term of protection for published works.[4]

5.1: implement Parliament’s At What Cost? IT pricing and the Australia Tax recommendation to make it clear that it is not an infringement of copyright to circumvent geoblocking.

5.2 repeal the remaining parallel import restrictions for books.

5.3 amend the Copyright Act 1968 to replace the current fair dealing exceptions with a broad exception for fair use.

The latter two, so far, have elicited the loudest complaints here and here.[13] Meanwhile, the US’ Register of Copyrights is celebrating the first anniversary of her Fair Use Index.

18.1 expand the safe harbours to online service providers.[5]

Patents

The Productivity Commission reports that there are 120,000 active patents registered in Australia. 93% of these have been granted to non-residents. There are also 25,000 – 30,000 applications each year; of which about 60% ultimately proceed to grant.

According to the Productivity Commission, however, there are too many granted patents which do not contribute social value and are not “additional” – in the sense that they would not have been made if there was no patent protection.[6]

This needs to be remedied. However, the Productivity Commission acknowledges that international agreements put constraints on our freedom of action. There are 10 recommendations for patents.

The key recommendation for standard patents is yet another go at raising the threshold of inventive step.

an invention is taken to involve an inventive step if, having regard to the prior art base, it is not obvious to a person skilled in the relevant art.

This looks very similar to what we already have. As the Productivity Commission envisages matters, however, there are important differences. First, it reverses the onus currently expressed in s 7(2). According to the Productivity Commission, the current position is the opposite of where the onus lies in the USA, Japan, the EU and the UK (amongst others). Rather than a challenger having to prove the invention is obvious, therefore, the patentee will have to prove it is not.

Secondly, the Productivity Commission sees the current requirement that there be only a scintilla of invention being raised. The Productivity Commission sees this low threshold being reflected in the limitation on “obvious to try” being something which the skilled addressee would be directly led as a matter of course. Instead, the Productivity Commission considers that the test should be at least:

whether a course of action required to arrive at the invention or solution to the problem would have been obvious for a person skilled in the art to try with a reasonable expectation of success (as applied by the Boards of Appeal of the EPO).[7]

This change would be buttressed with appropriate comments in the Explanatory Memorandum and, additionally, the insertion of an objects clause into the Act. The latter would be intended to ensure that the Courts focused on the social objectives of the Patents Act including, in particular, the public interest.[8]

On the more colourful fronts, the Productivity Commission also recommended repeal of the abomination innovation patent and amendment of s 18 explicitly to exclude from patentable subject matter business methods and software.[9]

Pointing to analysis which estimates the net present value to R & D of the extension of term for a pharmaceutical patentat at year 10 at $370 million – of which only $7.5 million would accrue to Australia because our industry is so small – while the cost to the Australian government and consumers of the same extension of term is estimated at $1.4 billion, the Productivity Commission also wants a significant tightening up of the regime for extending the term of pharmaceutical patents. The Productivity Commission also opposes any extension of the period of data protection for therapeutic goods, including biologics.[10]

The Productivity Commission also recommends exploring raising the renewal fees payable, particularly in later year’s of a patent’s life.

Registered designs

The Productivity Commission considers the registered design system deficient but, as we have committed to it internationally and there is no better alternative, we are stuck with it.

However, continuing the net importer theme, Australia should not go into the Hague system “until an evidence-based case is made, informed by a cost–benefit analysis.”

Trade marks

I’m just going to cut and paste here: the Government should:

  • restore the power for the trade mark registrar to apply mandatory disclaimers to trade mark applications, consistent with the recommendation of the Advisory Council on Intellectual Property in 2004 (the only people that won’t support this are in the place that counts – IP Australia)
  • repeal part 17 of the Trade Marks Act 1995 (Cth) (Trade Marks Act)
  • amend s. 43 of the Trade Marks Act so that the presumption of registrability does not apply to the registration of marks that could be misleading or confusing
  • amend the schedule of fees for trade mark registrations so that higher fees apply for marks that register in multiple classes and/or entire classes of goods and services.
  • require the Trade Marks Office to return to its previous practice of routinely challenging trade mark applications that contain contemporary geographical references (under s. 43 of the Trade Marks Act). Challenges would not extend where endorsements require goods and services to be produced in the area nominated
  • in conjunction with the Australian Securities and Investments Commission, link the Australian Trade Mark On-line Search System database with the business registration portal, including to ensure a warning if a registration may infringe an existing trade mark, and to allow for searches of disclaimers and endorsements.

Also, s 123 should be fixed up so that parallel importing does not infringe.

Like the rest of us, the Productivity Commission is bemused by the Circuits Layout Act and recommends implementing “without delay” ACIP’s 2010 recommendation to enable “essentially derived variety declarations to be made in respect of any [plant] variety.”

On competition policy, s 51(3) should be repealed and the ACCC should develop guidelines on the application of our antitrust rules to IP.

Innovatively, the Productivity Commission also recommends free access to all publications funded directly by Government (Commonwealth, State or Terriroty) or through university funding.

There are also at least 17 requests for further information.

If you are inspired to make a further submission, you should get it in before 3 June 2016.[11]


  1. Not much discussion here whether the best way to get more technological development is through a strong IP regime or to,scrap the IP system and fully commit to free riding.  ?
  2. Despite the tentative nature of this declaration, it is the first “Main key points”.  ?
  3. Draft finding 4.2.  ?
  4. The Government is trying to do this – see schedule 3 of the exposure draft of the Copyright Amendment (Disability Access and Other Measures) Bill (pdf).  ?
  5. See schedule 2 of the Disability Access and Other Measures bill.  ?
  6. You will have to read Appendix D to find out how the Productivity Commission works out which patents are socially valuable and “additional”.  ?
  7. The EPO cases the Productivity Commission referred to are T 149/93 (Retinoids/Kligman) (1995) at 5.2 and T 1877/08 (Refrigerants/EI du Pont) (2010) at 3.8.3.  ?
  8. Here, the Productivity Commission notes that the Full Federal Court rejected reference to the public interest in Grant.  ?
  9. Dr Summerfield tells you why he thinks that’s a bad idea over here and of course, the Europeans (including the UK in that) do not have all sorts of complications carrying out their nice, clean exclusion.  ?
  10. In an interesting departure from its overarching premise that patents do not really contribute much to innovation because there are other protections such as lead time and trade secrets, the Productivity Commission warns that reliance on data secrecy is sub-optimal compared to patent protection.  ?
  11. Bearing in mind they have to submit their Final Report to Government by 18 August 2016.  ?
  12. In between buying your books from Amazon and Bookdepository, some references to the larger economic issues affecting booksellers here.  ?

Canada’s IP and antitrust enforcement guidelines

The Canadian Competition Bureau has published updated guidelines relating to the enforcement of intellectual property rights and the antitrust (competition) rules.

The Bureau does not presume that the exercise of IP rights violates competition rules but, in assessing whether there are competition law ramifications, it distinguishes between two types of conduct: conduct “involving something more than the mere exercise of the IP right, and those involving the mere exercise of the IP right and nothing else.” Special rules, which may be applied in “very rare circumstances” apply to the latter. While the general competition rules apply to the former.

According to the Canadian firm, Tories, the updated guidelines include consideration relating to:

  • patent litigation settlement arrangements including reverse payment settlements
  • product switching
  • patent assertion entities
  • standard essential patents

Why should someone in Australia care?

For one thing (bearing in mind the ACCC’s challenge to Pfizer’s practices when its Lipitor patent was expiring – judgment is reserved in the appeal), the US Supreme Court is expected to hand down a decision this year on how US antitrust laws apply to reverse payment settlements.

For another thing, following the Competition Review here in Australia:

  • the Government announced its intention to implement the Harper Review’s recommendation that s 51(3) be repealed and, if that happens, the ACCC is supposed to produce its own guidelines; and
  • in the meantime, at the Government’s direction, the Productivity Commission is undertaking a review of Intellectual Property Arrangements including its alleged anti-competitive effects.[1]

Lid dip: Peter Willis

  1. The draft report is due to published “any day now”.  ?

Harper Review: Government Response

Yesterday (November 24), the Government published its response to the Competition (Harper) Review.

According to the response, “Harper” made 5556 recommendations; the Government has accepted 39 of them in full, 5 in part and the remainder are still under advisement.

In the intellectual property field, the item receiving most press (here and here) is the Government’s acceptance of the recommendation to remove all remaining restrictions on parallel importing books. At the moment,[1] the importation of a genuine book published first in Australia or within 30 days of first publication overseas may be blocked provided the copyright owner complies with the convoluted regime to supply copies in response to an order. This guarantees availability, but still leaves the copyright owner free to set the price it charges the person placing the order.

Harper recommended:

Restrictions on parallel imports should be removed unless it can be shown that:

• the benefits of the restrictions to the community as a whole outweigh the costs; and

• the objectives of the restrictions can only be achieved by restricting competition.

Consistent with the recommendations of recent Productivity Commission reviews, parallel import restrictions on books and second?hand cars should be removed, subject to transitional arrangements as recommended by the Productivity Commission.

Remaining provisions of the Copyright Act 1968 that restrict parallel imports, and the parallel importation defence under the Trade Marks Act 1995, should be reviewed by an independent body, such as the Productivity Commission.

What the Government plans:

The Government supports the removal of parallel import restrictions on books. The Government will progress this recommendation following the Productivity Commission’s inquiry into Australia’s intellectual property arrangements (see Recommendations 6 above) and consultations with the sector on transitional arrangements.

The terms of reference for the inquiry provide that the Productivity Commission is to have regard to the findings and recommendations of the Harper Review in the context of the Government’s response, including recommendations related to parallel import restrictions in the Copyright Act 1968 and the parallel importation defence under the Trade Marks Act 1995.[2]

Harper’s recommendation 6 was a reference to the Productivity Commission to undertake a 12 month long “overarching review of intellectual property” focusing on

competition policy issues in intellectual property arising from new developments in technology and markets; and the principles underpinning the inclusion of intellectual property provisions in international trade agreements.

The Government response notes that in August it had already made this reference to the Productivity Commission.[3] The response on this point is curiously even-handed. The Productivty Commission:

is to have regard to Australia’s international arrangements, including obligations accepted under bilateral, multilateral and regional trade agreements to which Australia is a party. The global economy and technology are changing and there have been increases in the scope and duration of intellectual property protection. Excessive intellectual property protection can result in higher costs for Australian businesses and consumers and inhibit innovation. However, weak intellectual property protection can lead to under?investment in research and development (R&D) which also stifles innovation. A comprehensive evaluation of Australia’s intellectual property framework is needed to ensure that the appropriate balance exists between incentives for innovation and investment and the interests of both individuals and businesses, including small businesses, in accessing ideas and products. (emphasis supplied)

However, an independent inquiry into the processes for negotiating intellectual property provisions in treaties is not necessary: there are already robust processes in place and publishing an independent cost benefit analysis before the negotiations have concluded might tip our hand in the negotiations.

Section 51(3) gained a slight reprieve. Harper’s recommendation 7 was that it be repealed (and a new power for the ACCC to create block exemptions be introduced). Despite Prof. Harper’s injunctions that this is old news and we should just, er, do it, the Government thinks it should wait and see what the Productivity Commission says. Anyone betting the Productivity Commission won’t recommend …?

The Government also supports conferring a power to grant block exemptions on the ACCC:

A block exemption removes the need to make individual applications for exemption. The exemption is granted if the competition regulator considers that certain conditions are satisfied: either that the category of conduct is unlikely to damage competition; or that the conduct is likely to generate a net public benefit.

A block exemption power that supplements the existing authorisation and notification frameworks will be helpful in establishing ‘safe harbours’ for business. Block exemptions will reduce compliance costs and provide further certainty about the application of the CCA. They are an efficient way to deal with certain types of business conduct that are unlikely to raise competition concerns, either because of the parties engaged in the conduct or the nature of the conduct itself.

So, in the interests of promoting competition, we are going to introduce a European-style power for the regulator to design the marketplace.


  1. Copyright Act s 44A.  ?
  2. The Government also said it would not proceed with the recommendation about second hand cars, in the interests of consumer protection and community safety.  ?
  3. Indeed, you should already be putting the finishing touches on your submissions in response to the Issue Paper since they are due on Monday!  ?

Productivity Commission to review all IP laws

The Harper Review[1] recommended that the Government should direct the Productivity Commission to undertake an overarching review Australia’s IP laws.

The Treasurer and the Minister for Small Business have now announced that review.

According to the Harper Review:

an appropriate balance must be struck between encouraging widespread adoption of new productivity-enhancing techniques, processes and systems on the one hand, and fostering ideas and innovation on the other. Excessive IP protection can not only discourage adoption of new technologies but also stifle innovation.

Given the influence of Australia’s IP rights on facilitating (or inhibiting) innovation, competition and trade, the Panel believes the IP system should be designed to operate in the best interests of Australians.

The Panel therefore considers that Australia’s IP rights regime is a priority area for review. (emphasis supplied)

In reaching that view, the Harper Review flagged concern about entering into new treaties with extended IP protections.

The terms of reference state:

In undertaking the inquiry the Commission should:

  1. examine the effect of the scope and duration of protection afforded by Australia’s intellectual property system on:

    a. research and innovation, including freedom to build on existing innovation;

    b. access to and cost of goods and services; and competition, trade and investment.

  2. recommend changes to the current system that would improve the overall wellbeing of Australian society, which take account of Australia’s international trade obligations, including changes that would:

    a. encourage creativity, investment and new innovation by individuals, businesses and through collaboration while not unduly restricting access to technologies and creative works;

    b. allow access to an increased range of quality and value goods and services;

    c. provide greater certainty to individuals and businesses as to whether they are likely to infringe the intellectual property rights of others; and

    d. reduce the compliance and administrative costs associated with intellectual property rules.

Then follows a catalogue of 9 matters for the Commission to have regard to. These include the Government’s desire to retain appropriate incentives for innovation, the economy-wide and distributional consequences of recommendation and the Harper Review’s recommendations in relation to parallel imports.[2]

The Commission must report within 12 months.


  1. The Competition Policy Review, recommendation 6.  ?
  2. Rec. 13 and section 10.6 of the Competition Policy Review: i.e., repeal any remaining restrictions unless the benefits outweigh the costs and the objectives of the restrictions can only be achieved by restricting competition. Cue diatribe about “restricting competition” especially given the oft mouthed formula that IP rights rarely (if ever) restrict competition.  ?

IP and antitrust in Australia

Wow! I think this is a first in Australia: the ACCC – Australia’s competition “watchdog” – is suing Pfizer for antitrust breaches over its (then expiring) patent for Lipitor.[1]

According to the ACCC’s press release:

At its peak, Lipitor was prescribed to over one million Australians with annual sales exceeding AU$700 million.

Pfizer had a patent over the active ingredient, atorvastatin, but it expired in May 2012.

Early in 2012 (before the patent expired), the ACCC alleges that Pfizer offered to supply Lipitor to pharmacies at “significant discounts and the payment of rebates previously accrued” so long as they agreed to buy from Pfizer a minimum volume of up to 12 months’ generic atorvastatin after the patent expired.

The ACCC alleges this constituted a misuse of market power contrary to s 46 and exclusive dealing contrary to s 47 of the Competition and Consumer Act because:

(1) the offers were made before the patent expired and so at a time when other generic suppliers could not make offers; and

(2) “Pfizer engaged in this conduct for the purpose of deterring or preventing competitors in the market for atorvastatin from engaging in competitive conduct, as well as for the purpose of substantially lessening competition”.

If the ACCC is right, it wants penalties, declarations and costs. Under the Act, the pecuniary penalties could be up to the greater of $10 million, 3 times the benefit gained from the contravention or 10% of annual turnover.

More generally, as the ACCC’s chairman flagged:

This case also raises an important public interest issue regarding the conduct of a patent holder nearing the expiry of that patent and what constitutes permissible competitive conduct.

Now, patentees’ efforts, while their patent is in force, to tie customers into taking the product after the patent has expired, were so controversial that, just over one hundred years ago, Parliaments introduced legislation to permit licensees to terminate patent licences once the patent expired.[2]

Beyond that, s 46 also prohibits any corporation from taking advantage of a substantial degree of power in a market for the purpose of:

(a) eliminating or substantially damaging a competitor of the corporation or of a body corporate that is related to the corporation in that or any other market;

(b) preventing the entry of a person into that or any other market; or

(c) deterring or preventing a person from engaging in competitive conduct in that or any other market.

So, to contravene s 46, the ACCC will have to establish two conditions:

(1) Pfizer had a substantial degree of power in a market; and

(2) it took advantage of that power for an anti-competitive purpose.

The first issue turns on what is the market: the market for Lipitor or some wider market such as a market for the treatment of high cholesterol? This question highlights the reference in the ACCC’s press release to the succes of Lipitor “at its peak”. I don’t know much about the market for treatment of high cholesterol but, by the time Pfizer did this allegedly dastardly deed, there were presumably some alternatives to prescribing Lipitor.[3]

In an earlier proceeding involving copyright,[4] the Full Court of the Federal Court held that a record company which had less than 20% of the market did not have a substantial degree of power in the market. So, unless the ACCC can tie the market narrowly to the market for Lipitor, it may well face considerable difficulties.[5]

Those difficulties may mean that the s 47 allegation has greater significance as, in that earlier case, the Full Federal Court still found the record companies contravened s 47 even though they did not have market power. Although their conduct could not have the effect of substantially lessening competition (because they did not have sufficient market power), their purpose was anti-competitive.

Plainly, Pfizer was trying to sign up the pharmacies to this deal so that they would not buy at least the minimum amount from these generic suppliers who were apparently waiting in the wings, but is that anti-competitive? Maybe it depends on how large the minimum requirement is in relation to the pharmacy’s expected needs for the period. But, it was only for 12 months!

Normally,[6] one would expect the pharmacies could readily calculate whether they were better off taking the deal or continuing to pay the “list” price for Lipitor and then taking advantage of spot prices in the market after the patent expired. If the alleged contravention, however, was that Pfizer refused to supply Lipitor at all while the patent was in force unless the pharmacies agreed to buy “generic” Lipitor after the patent’s expiry, that might have put the pharmacies in a very difficult position of being unable to fill prescriptions.

A further potential complication is that s 47 does not apply to conditions in a licence (or assignment) of a patent to the extent the conditions related to the patented invention or articles made by the use of the patented invention. No-one really knows what that means. Could a pharmacy that agrees to buy Lipitor from Pfizer be a licensee? Certainly, in keeping the drug for sale and selling it, the pharmacy would be exploiting the patent (while it was still in force), but has an implied licence to do those acts. Could agreement to buy “generic” Lipitor after the patent has expired relate to the invention?

At this stage, the parties have filed their respective pleadings,[7] discovery is taking place to be followed by affidavits and a return to Court for further directions in September.

The ACCC’s press release

Lid dip: Patentology


  1. Federal Court Proceeding No. NSD 146/2014, filed on 13 February 2014.  ?
  2. As this case demonstrated, however, it has limited effect.  ?
  3. And it may often be the case that different drugs have different side effects or have particular advantages over other treatments so it is not quite the same as comparing, say, Pink Lady apples with Fuji apples or ….  ?
  4. Universal Music Australia Pty Ltd v Australian Competition & Consumer Commission [2003] FCAFC 193  ?
  5. That said, the price of Lipitor in Australia, even off-patent, has managed to attract unfavourable headlines.  ?
  6. Maybe there is some complexity arising from the arcane operations of pricing under the Pharmaceutical Benefits Scheme?  ?
  7. If anyone cares to provide a copy, I’d love to read them :-).  ?