Experimental research conducted using patented inventions will not infringe the rights of the patent holder, once the Federal Government follows through with its announcement on 6 August 2007 that it will amend the Patents Act 1990 (Cth) (Act). This exception, when introduced into law, should clarify the legal rights of anyone engaged in research and development activities. In particular, researchers whose research may involve the use of a patented invention should be able to assess more accurately, whether they need to obtain the permission of the owner of the patent.
The Government is responding to the recommendations made by the Advisory Council on Intellectual Property (ACIP) in its October 2005 report on patents and experimental use. ACIP examined the current state of the law, and found that it was not clear that there is an existing exception from infringement for experimental uses of patented inventions. Interestingly, it also found that this did not seem to be inhibiting research on inventions in Australia, because researchers tended to act as if an implied exception did exist to protect them from infringement actions. However, ACIP's recommendation was that, to increase certainty for the owners and users of intellectual property, there should be an express legislative exception for acts done for experimental purposes.
ACIP's proposed exception means that acts done in respect of a patented invention which:
- are done for experimental purposes;
- relate to the subject matter of the invention; and
- do not unreasonably conflict with the normal exploitation of a patent,
will not infringe the patent.
According to ACIP's report, in some cases experimentation may be covered, even if the final goal of carrying out the research is to develop a product, which can be commercialised.
To provide further guidance on the application of the exception, ACIP also recommended that certain acts be listed as examples of acts done for experimental purposes relating to the subject matter of the invention, as follows:
- determining how the invention works;
- determining the scope of the invention;
- determining the validity of the patent claims; and
- seeking an improvement to the invention.
In its response, the Government accepted ACIP's recommendation in principle, and stated that the exception will reflect the recommendation 'to the extent possible' in light of Australia's international obligations. In particular, the World Trade Organisation Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) prohibits countries from implementing exceptions to a patent owner's exclusive rights, unless the exception does not 'unreasonably conflict with the normal exploitation of the patent' and does not 'unreasonably prejudice the legitimate interests of the patent owner, taking account of the legitimate interests of third parties'. While ACIP's recommended exception reflects the first limb of this test, the Government will wish to ensure that the exception does not prejudice patent owners' legitimate interests, and therefore breach the TRIPS Agreement, before amending the Act.
The introduction of the exception recommended by ACIP should provide greater certainty to both the owners of patents and those who experiment on them. There are currently few patent infringement actions brought against persons for carrying out research on another person's patented invention without permission. However, if patent holders wish to start enforcing their rights in these circumstances, both they and the alleged infringer would face difficulties in assessing the strength of their relative positions, given the lack of guidance currently provided by Australian law.
While one of ACIP's considerations in framing its proposed exception was to make it as clear as possible, it also recognised that the legislative exception could not be completely prescriptive and would inevitably leave room for doubt as to its application to particular facts. For example, ACIP suggested that the list of acts falling within the exception be non-exhaustive (to permit flexibility), rather than exhaustive (which may have provided a greater degree of certainty). No matter what wording is adopted by the Government in drafting the amendment to the Act, there will be areas of uncertainty which may, in turn, require clarification before the courts.
However, the adoption by the Government of ACIP's recommendation is a further step towards creating a more certain legal environment, in which both the owners and users of patents have a better understanding of their respective rights, and in which researchers have increased confidence to engage in innovation with less fear of legal action.
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