Media release

Australia's intellectual property system has lost sight of users

Action must be taken to rebalance Australia's intellectual property (IP) arrangements, according to a wide-ranging draft report released by the Productivity Commission.

A good IP system balances the interests of rights holders and users, but Australia's system has swung too far in favour of vocal rights holders and influential IP exporting nations.

'No matter how you measure it, Australia overwhelmingly imports more IP than it exports — and this gap is widening. Most of the profits from excessive IP rights flow offshore, while Australian consumers and taxpayers are left to pick up the tab,' said Commissioner Karen Chester.

Many of Australia's IP arrangements are locked-in by trade agreements, frustrating much needed change. Despite these constraints, the Commission has identified a workable bundle of reforms.

'Contrary to views that more patents are always better, Australia's patent system is poorly targeted. Some patented inventions border on trivial and protection can last too long. For pharmaceuticals alone, excessive protection costs the Australian Government, taxpayers and consumers over a quarter of a billion dollars each year,' Commissioner Jonathan Coppel said.

'Only genuine innovations should be granted patent protection and patent fees need to be higher to discourage rights holders from hanging on to patents longer than they need to,' Commissioner Jonathan Coppel said.

Copyright is important for rewarding creative endeavour. But in Australia, it is more a case of 'copy(not)right'. Copyright is pervasive, affecting everyone from hip hop artists sampling music,

school children watching a documentary in class, libraries and museums preserving Australia's history, to innovative researchers accessing databases for data mining.

Copyright protection lasts too long — a book written today by an author who lives for another 50 years will be protected until 2136.

To correct these imbalances, Australia needs a new, principles-based, fair use exception, to protect user rights without undermining the incentive to create.

'Surveys reveal much online copyright infringement is out of sheer frustration from poor access. The best antidote to copyright infringement is accessible and competitively priced online content, not draconian penalties and big brother enforcement.'

'Rights holders and their intermediaries need to do more to deliver timely and accessible content. The Government should also make clear that Australians should be able to circumvent geoblocking technology,' said Commissioner Karen Chester.

The benefits of IP reform would be far reaching. 'True innovation and creativity will be rewarded, while consumers will have better access to new and cheaper goods and services. Australian firms won't have to engage in costly workarounds that hinder follow-on innovation,' Commissioner Jonathan Coppel said.

The Commission is inviting submissions on the draft report by 3 June 2016 and will hold public hearings in June.

Background information

Leonora Nicol (Media, Publications and Web) 02 6240 3239 / 0417 665 443