10 August 2020

Designing a reform – Exposure drafts for key Designs Act 2003 amendments released

This article was written by John Swinson, Johnathon Hall and Linus Schibler.

The designs regime in Australia is set to receive a long-anticipated update following IP Australia recently releasing exposure drafts of the Designs Amendment (Advisory Council on Intellectual Property Response) Bill 2020 and Regulations 2020 (Cth) for public consultation (together, the Exposure Drafts). The Exposure Drafts are the latest step in IP Australia’s movement to amend the Designs Act 2003 (Cth) and Designs Regulation 2004 (Cth), which have been the subject of significant review and public discussion.

The amendments proposed in the Exposure Drafts adopt several recommendations made by the Advisory Council on Intellectual Property in their 2015 report, which were agreed by the Australian Government in May 2016 and saw public consultation in late 2019 to early 2020. Broadly, the amendments include:

  • introduction of a new twelve-month grace period for design registration;
  • amending the existing prior use defence for third parties using a disclosed but unregistered design;
  • simplifying the design registration process via amalgamating the registration and publication processes, including a new publication delay option;
  • expansion of the exclusive licensee’s right to bring infringement proceedings; and
  • reduction of red-tape requirements in the design registration process.

We explore these amendments and their impact on the Australian designs regime in further detail below.

How do designs fit into the intellectual property puzzle?

A design is one type of intellectual property formally protected through Australian legislation. Designs are the characteristics that represent the visual elements of a product – including the shape, configuration, pattern or ornamentation of the product. Common examples of designs include furniture, clothing items and the uniquely shaped containers used by specific brands.  The Weber kettle BBQ and the Eames lounge chair are the kinds of products that can be protected by a registered design.

Registration of a design under the Designs Act 2003 (Cth) provides an initial five years of protection and exclusive use, licensing and sale rights, which can be renewed for a further five years of protection prior to protection ceasing and the design entering the public domain. Similar regimes exist worldwide in other jurisdictions with variations in nomenclature – in the USA, for example, a registered design is called a design patent.

Exposure Draft proposals – what is changing?

The reforms to the Designs Act 2003 (Cth) proposed in the Exposure Drafts focus on both increasing the utility of the designs registration framework and reducing the red-tape requirements that interfere with the practical aspects of using designs in Australia. The Exposure Drafts concentrate on five key areas of reform:

Registration grace period

A design must be “new and distinctive” to be registered. Currently, an application for a registered design must be filed before the design is first disclosed to not impact the “new and distinctive” elements of the design. To address this, the Exposure Drafts propose amendment of section 17 of the Designs Act 2003 (Cth) to introduce a twelve-month grace period to file for design registration after a design has been disclosed to the public. Introduction of a grace period would bring the Designs Act 2003 (Cth) in-line with the Patents Act 1990 (Cth), which offers a similar grace period of 12 months to disclosed patentable subject matter.

The current section 17 of the Designs Act 2003 (Cth) provides that a design that has been disclosed to the public can only be registered in limited circumstances, including where disclosure occurred as part of an international exhibition or where disclosure was made by another party without the owner’s consent. This restriction is due to the disclosure impacting the assessment of the design as being “new and distinctive”. The consequence of the current drafting is that many designs are unable to be registered because the design is disclosed before the application for the design is filed,

The proposed new section 17 provides for two categories of disclosure that must be disregarded in assessing whether a design is “new and distinctive”. If a disclosure is made in the twelve-month period before the design’s priority date, including disclosure of a slight variation of the design, by:

  • the current or previous owner of the design; or
  • another person or body (other than a foreign design registrar or body) that derived the design from the design seeking registration,

the disclosure will not be considered as part of the “new and distinctive” assessment. Designs that are filed and published in international jurisdictions are unable to rely on this grace period and will instead need to be registered through the existing Paris Convention processes recognised by the Designs Act 2003 (Cth).

Prior Use Defence

In addition to the proposed introduction of the 12-month grace period, the Exposure Draft proposes a prior-use defence for third parties who start using a published design in Australia during the grace period. The changes would protect third parties against infringement proceedings if they used the design prior to the priority date of the registered design.

The proposed amendments would not protect the third party if they derive their design from the registered owner of the registered design or if the third-party use commences after the priority date. This limitation is intended to balance the need to provide surety to third parties where they may incidentally infringe a design covered by the 12-month grace period, while maintaining protection for designs in instances of deliberate piracy.

Options to delay publication

A further objective of the Exposure Drafts is to streamline the currently distinct registration and publication processes into a single process involving both registration and publication. Applicants would also have the option to delay registration and publication for a prescribed period.

Registration or publication under the current Designs Act 2003 (Cth) requires the Registrar to make the design application and supporting materials available to the public upon registration or publication of a design. IP Australia has stated that this requirement impedes the registration process, as applicants may be hesitant to seek registration if their commercial timeline is inconsistent with the registration timeline.

Under the proposed amendments, applicants can select to either:

  • register and publish a design as soon as registration is approved; or
  • to delay registration and publication for a prescribed period (currently proposed to be six months) following approval of a design registration. Any delayed registration and publications would occur automatically at the end of the prescribed period.

These amendments streamline the existing provisions by merging the application process for registration and publication of designs and providing increased flexibility to applicants requiring additional time to prepare their design for commercial applications.

Exclusive licensees’ rights

The Exposure Draft also proposes to provide exclusive licensees with the right to commence proceedings against third parties for design infringement.

Currently, an exclusive licensee has no recourse where design infringement is occurring and must rely on the owner of the design commencing proceedings to protect the licensee’s usage right. In some instances, this means the exclusive licensee is left without remedy where the design owner has no financial or commercial interest in commencing proceedings against the infringer, or where the infringer is the design owner. An expansion of an exclusive licensee’s rights would bring the Designs Act 2003 (Cth) in line with Australian copyright, trade mark and patent laws and promote licensing of international designs in the Australian market.

Formal requirements

The Exposure Drafts propose some other minor amendments to the Designs Act 2003 (Cth) and Designs Regulation 2004 (Cth), including allowing the Registrar of Designs to determine the formal requirements for a design application by non-legislative instrument, whereas previously such a direction was made under section 144B(2) of the Designs Act 2003 (Cth). Each of these minor amendments feature a common theme of reducing red-tape in the registration process to improve the accessibility and utility of the designs registration framework.

What’s next?

IP Australia is accepting submissions on the Exposure Drafts until 28 August 2020, with the intention of identifying any oversights in the drafting and application of the Exposure Drafts prior to formal introduction to Parliament. More information regarding the Exposure Drafts and submission process is available from IP Australia here.

 

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