Strategies to keep in mind as the death knell sounds for Australia’s second-tier Patent system

Dr Jim Onishi MRACI

Key Points:
1) Australia is abolishing its second-tier Innovation Patent system.
2) The last date to file an Innovation Patent is 25 August 2021.
3) It is still possible for patentees to obtain “new” Innovation Patents
after 26 August 2021.

Brief Background

Two tiers of Patent protection are currently available to Applicants in Australia, a Standard Patent and an Innovation Patent. The Innovation Patent is considered to be a second-tier Patent, because of the lower “innovative step” threshold for determining non-obviousness. Otherwise, all other patentability criteria remain the same for both Standard Patents and Innovation Patents. The main drawbacks for Innovation Patents include the limitation of having a maximum of five claims, and a reduced Patent term of eight years. On the plus side, the ability to obtain the grant of a Patent without undergoing substantive examination and the lower renewal fees, are both attractive.

The Australian Government identified that Innovation Patents were largely exploited by “big business” to create Patent thickets, which suffocate small and medium enterprise’s (SME’s) freedom to operate and compete against them. It also identified that the lower standards for Innovation Patents inhibit innovation and competition. In light of this backdrop, the Government drafted legislation to abolish the Innovation Patent entitled: The Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019. The Bill was introduced and passed the Australian Parliament. It received Royal Assent on 26 February 2020 to become the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Act 2020. The death date of the Innovation Patent is 26 August 2021. This means that the last date to file an Innovation Patent Application is 25 August 2021.

Imminent Deadline?

With only around 3 months now remaining until the demise of the Innovation Patent system, there has been a large volume of Innovation Patents being filed at IP Australia, resulting in Patentees experiencing delays in obtaining grant of their Innovation Patents.

Is the Innovation Patent truly dead?

Strategies

Whilst Innovation Patents cannot be filed after 26 August 2021, it is still possible for patentees to obtain “new” Innovation Patents on or after this date.

Strategies for pending cases include:

  • Converting an existing Standard Patent Application into an Innovation Patent;
  • Filing a Divisional Innovation Patent from an existing Standard Patent Application; and
  • Filing a Standard Divisional Patent Application from an existing Standard Patent Application, with a view to later converting it into an Innovation Patent.

A strategy for any new cases includes:

  • Filing Non-Provisional/Complete Patent Applications in Australia no later than 25 August 2021.

For any new cases, Patentees may wish to consider filing their first Non-Provisional/Complete Patent Applications in Australia no later than 25 August 2021. This would provide Patentees with the option of obtaining Innovation Patents in Australia, whilst delaying publication of the Application for 18 months. The delayed publication may be commercially advantageous should it be desirable to keep the contents of the Patent Application a “secret” from competitors and other third parties. Also, any Non-Provisional/Complete Patent Applications filed in Australia could act as a pseudo “Provisional” and could be the basis for obtaining Patents in other jurisdictions. Patentees would be able to file an International PCT Application and/or Standard Convention Applications in the jurisdictions of interest, based on the Australian filing at any time within 12 months of the filing date.

Final Words

The key to ensuring that Innovation Patents are still available to patentees is to have a Complete Patent Application with a filing date earlier than 26 August 2021. It may therefore be worthwhile bringing forward any originating PCT or Standard Patent Applications coming due, so that a filing date no later than 25 August 2021 is obtained. Naturally, bringing forward the filing date would shift the 20-year monopoly period earlier and due consideration should be given to determining whether obtaining an earlier filing date would have any adverse impact on commercial objectives.

The Innovation Patent lives on like a phoenix rising from the ashes. Should you have any questions regarding the filing of Innovation Patents, please contact us at mail@houlihan2.com.

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