The Advisory Council on Intellectual Property, ACIP, today released its final report in its Review on Patents and Experimental Use. In short, like the ALRC, they have recommended the creation of a specific experimental use exception.

Yes, we have had two reviews which have had a bearing on this issue. And all this in a relatively controversial environment internationally. Let me elaborate a little.

The current law

There is some difference of opinion about whether, in Australian law, it is an infringement of patent to conduct experiments on the patented subject matter. In essence:

  • There is nothing in the Act that bears directly on the issue;
  • Patents are infringed when someone ‘exploits’ the invention (see section 13; rights of the patent owner). But what does that mean?
  • On this issue, we have no Australian case law, and only very ancient English case law which is far from clear. So some people think there is an exception; some don’t, and if there is one, no one knows its potential scope. In reality, lots of people are probably behaving as if there is an exception, by experimenting away;
  • In recent US case law – in particular, a case called Madey v Duke – the exception in US law has been interpreted quite narrowly, holding that a University would infringe a patent, even where its experiments were not for commercial gain, ‘so long as the act is in furtherance of the alleged infringer’s legitimate business and is not solely for amusement, to satisfy idle curiosity, or for strictly philosophical inquiry’. The ‘legitimate business’ of the university included attracting research funding and research students. Hence use was an infringement. This narrow reading led to proposals from important US bodies, like the National Academy of Sciences, that a broader exception should be created.
  • There is an exception in most European countries, such as in the UK, where there is an exception for activities which are ‘done for experimental purposes relating to the subject matter of the invention’ (s 60)

The Australian Reviews

In the last little while, issues of experimental use have arisen in two government reviews.

First, we had the ALRC inquiring into Genes and Patenting. Their final report, Genes and Ingenuity, was released in August 2004. While the ALRC review was focused on the interaction between patenting and genetic sciences, in many respects, their review had to take in the full range of current issues in patent law. They considered, in particular, the issue of experimental use, and recommended an exception.

Now, ACIP have done the same.

The differences between the two reviews

Interestingly, the ALRC and ACIP have come out with different recommendations. The differences are such that only lawyers could love them – I’m sure that most actual researchers out there will not be able to see any major differences.

The ALRC recommended:

The Commonwealth should amend the Patents Act 1990 (Cth) (Patents Act) to establish an exemption from patent infringement for acts done to study or experiment on the subject matter of a patented invention; for example, to investigate its properties or improve upon it. The amendment should also make it clear that:
(a) the exemption is available only if study or experimentation is the sole or dominant purpose of the act;
(b) the existence of a commercial purpose or objective does not preclude the application of the exemption; and
(c) the exemption does not derogate from any study or experimentation that may otherwise be permitted under the Patents Act.

The ALRC here rely on the distinction between experimenting on the invention, and experimenting using the invention. The former should be allowed without infringement (or a license), the latter should not. So, for example, you couldn’t use patented research tools without a license. But, at a minimum, the ALRC said, experimentation that seeks further knowledge about the patented invention and its uses should be covered. The exemption should also extend to experimentation or research on the patented invention aimed at improving the invention. What more should be covered would fall to caselaw.

ACIP have recommended (pdf) that the Patents Act be amended to establish the following provision:

The rights of a patentee are not infringed by acts done for experimental purposes relating to the subject matter of the invention that do not unreasonably conflict with the normal exploitation of a patent. Acts done for experimental purposes relating to the subject matter of the invention include:
– determining how the invention works;
– determining the scope of the invention;
– determining the validity of the claims;
– seeking an improvement to the invention.

So, the key possible difference is that where the ALRC recommended an exception for experimenting on the subject matter of the invention, ACIP are recommending an exception for experimenting relating to the subject matter.

Is this a real difference? It’s not entirely clear. It’s possible that an exception for activities relating to the subject matter is broader than experimenting on the subject matter. But it’s really not clear whether it is broader. The ALRC gave no real reason, in their final report, for adopting the ‘experimenting on’ language, rather than the language used in the European Union of ‘relating to’ an invention. ACIP seem to think there is a difference, but they sit on the fence a bit, just saying that the ALRC version ‘adds nothing’ to the European version, and that ‘relating to’ is better ‘in the interests of harmonisation’.

Rejection of ‘fair experimentation’

One of the other options that ACIP considered was an exception for ‘fair experimentation’. This was the option favoured by the National Health and Medical Research Council in their submission, where they said:

‘The use of the words “fair experimentation” and their definition clearly describe the scope and intention of the exemption.
This is especially important for enabling scientists to judge whether their experiments contravene intellectual property laws or not. This, in turn, decreases the need for scientists to seek legal experts to determine the legality of their experimentation. The clarity of the language also enables legal experts to make reasonable judgements on a wide range of uses in order to determine whether they are permitted under the exemption or not.’

It’s probably a good thing that this has been rejected – it’s a copyright concept, after all, and in the end, I think would be narrower in effect than what its proponents may have thought (at least, if our courts’ past judgments on fair dealing are anything to go by…).

What now?

We wait and see. The government has not yet responded to the 50 recommendations for reform made by the ALRC and released over 12 months ago, so I wouldn’t be expecting a very speedy response.


Report here (pdf)
Media release here (pdf)
Warwick Rothnie here