Government mulls IP crackdown on “weak” patents

The Federal Government is considering tough new standards for innovation patents to stop large companies from abusing Australia’s IP system, admitting weaker patents can “create problems”.

According to Mark Dreyfus, Parliamentary Secretary for Industry and Innovation, innovation patents currently protect simple inventions and improvements to existing technologies.

Dreyfus said innovation patents also require an innovative step, whereas standard patents require an inventive step.

“It may seem like a trifling distinction, but weaker payments can create problems,” Dreyfus said in a statement.

“We want sufficient protection to reward inventors but not block obvious follow-on innovation.”

Innovation patents were introduced in 2001 to encourage IP protection for SMEs. But Dreyfus said some larger companies are now abusing the system to extend the life of their patents and deliberately target competitors.

As a result, IP Australia is inviting public comment on a proposal to amend the Patents Act. Submissions are due by October 25.

This amendment would raise the patentability threshold for innovation patents to the same level of inventiveness as required for standard patents, ensuring only high quality patents are granted.

According to the government, there has been an unusual growth of innovation patent applications for certain technologies such as IT and pharmaceuticals.

“Left unchecked, this could lead to… a lack of competition in some markets,” Dreyfus warned.

In a consultation paper, the government said the potential for “evergreening” is very concerning.

“Evergreening is a strategy in which companies could use innovation patents to effectively extend the life of their patents,” it said.

“In addition, the comparative ease of gaining an innovation patent could also help companies to create ‘patent thickets’; a wall of patents which hinders rivals’ ability to invent around a given invention.”

“There is a real and pressing risk that more applicants could choose to use these strategies in the future.”

According to the government, such strategic behaviour would likely bring Australia’s IP system into disrepute, both here and overseas.

“It would highlight the poor balance between protection and innovative disclosure within Australia’s innovation patent system,” it said.

“In order to meet its objective of supporting innovation, the patent system must strike a balance.”

“It must provide sufficient protection to reward innovation, but not so much protection as to block future or follow-on innovation.”