Innovation Patents to be Abolished

The innovation patent is a second-tier patent system which was introduced in Australia in 2001. It requires that inventions have an innovative step, rather than the higher threshold of an inventive step that is required for standard patents. An innovation patent has a maximum term of protection of 8 years rather than the 20 years under the standard patent system. The innovation patent system was introduced with the aim of incentivising innovation in small and medium enterprises with a quicker and more affordable process than the standard patent system which can take several years before grant.  However, a number of shortcomings in the system have resulted in the Australian government making plans to abolish the innovation patent altogether. In particular, there is the perception that the threshold test for innovative step is too low which has reduced the credibility of the innovation patent. There are also concerns that the system is being abused with low value patents flooding the market, creating uncertainty for new innovators.

In a 19 September 2019 statement, IP Australia has confirmed its plans to abolish the innovation patent system. This is despite submissions to the contrary from a variety of industry groups, including the Australia Chamber of Commerce and Industry, the Business Council of Australia, and the Institute of Patent and Trade Mark Attorneys of Australia. In particular, a common concern amongst these organisations is that the abolishment of the innovation patent system would be detrimental to innovation in Australia by SMEs. Whilst not a perfect system, it is a common view that innovation patents are an important tool for protecting commercially relevant inventions, assisting inventions come to market in Australia as well as attracting investment funds for SMEs further innovation. Despite this, as well as the suggestion for an improvement rather than revocation of the innovation patent system to be undertaken, the Government’s decision was not altered.  Once the legislation comes into effect, a commencement date will be set.  Any innovation patents filed before the commencement date can still be certified and enforced and innovation patent owners will still be entitled to enjoy the rights of their validly granted patents until the 8-year term expires.  It is therefore still possible to file an innovation patent and enjoy the benefits that its lower innovation threshold and quicker grant process provides.

If you would like to discuss the potential benefit of filing an innovation patent as a divisional of your existing patent, or otherwise have any questions regarding the implications this change has for your patent rights in Australia, please contact our team at info@actuateip.com.au