Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Link to this | Hansard source

The Intellectual Property Laws Amendment Bill 2014 is similar to the Intellectual Property Laws Amendment Bill that had been introduced by Labor in May 2013. Labor support this bill because it contains a number of important measures, which we first sought to progress in Labor's IP Laws Amendment Bill 2013 and which I will refer to in my remarks.

The patent system underpins our intellectual property system and, by extension, Australia's innovation system. The key to an intellectual property system is striking the right balance between encouraging innovation while ensuring people have access to new technologies. The patent system is particularly important for encouraging innovation in the biotech and pharmaceutical sectors because of the high costs and risks associated with developing new medicines. Without adequate patent protection, many new products would never make it through the development and commercialisation phase and would therefore never reach consumers.

A well-balanced IP system advances the interests of Australian innovators by lowering business costs and by making it easier to access export markets. But it also allows Australia to provide assistance to developing countries when it is needed most. When Labor were in government, we introduced the IP Laws Amendment Bill 2013, which contained a suite of measures to make the Australian IP system more responsive to the needs of consumers, more efficient for entrepreneurs and more supportive of other countries facing health emergencies. The primary purpose of Labor's bill was to clarify the scope of Crown use and its operation, particularly in the context of health care, and to implement the Trade-Related Aspects of Intellectual Property Agreement—otherwise known as the TRIPs protocol.

After scrutiny with various House of Representatives and Senate committees, Labor's bill reached the Senate in June 2013; however, it lapsed with the commencement of the 44th Parliament in November 2013. This bill amends the Patents Act 1990, the Trade Marks Act 1995, the Designs Act 2003 and the Plant Breeder's Rights Act 1994. The main purpose of this bill is to implement the TRIPs protocol, which would enable manufacturers of generic pharmaceuticals to apply to the Federal Court for a compulsory license to make and export a patented pharmaceutical product to address health crises in developing countries. Countries that implement the TRIPs protocol are able to export patented medicines under compulsory license to countries in need.

The TRIPs protocol is a World Trade Organisation agreement drafted in 2005 that sets out the minimum requirements for intellectual property protection for WTO member states. Australia has been a signatory to the TRIPs Agreement since September 2007, but has yet to implement these provisions via legislation. According to the World Health Organisation there are more than 100 countries currently experiencing one or more serious epidemics. In 2011 an estimated 262 million people were infected with malaria, HIV-AIDS or tuberculosis, causing 3.8 million deaths. Many of the countries suffering from such epidemics are developing countries that do not have the capacity to manufacture or distribute the necessary medicines. We are seeing this right now with the Ebola epidemic in West Africa.

The WTO has tried to address this situation through the TRIPs Agreement, which enables a country that is experiencing a serious epidemic to access patented drugs. Under the TRIPs protocol, member countries with limited or no manufacturing capacity can access patented pharmaceuticals made under compulsory license in another WTO country. The TRIPs protocol aims to encourage patent owners to either provide medicines to least developed countries at affordable prices or to issue a voluntary licence to generic manufacturers to provide medicines at affordable prices. If the patent owner is unwilling to do this, the protocol provides a mechanism to force the patent owner to issue a compulsory license. Schedules 1 and 2 of this bill, like Labor's 2013 bill, will enable manufacturers of generic pharmaceuticals to apply to the Federal Court for a compulsory license to make and export a patented pharmaceutical product to address health crises in developing countries, delivering on our commitment to the WTO's TRIPs protocol. It is important that we implement a proper mechanism to ensure access to essential medicines for countries in need.

In addition to implementing Australia's commitment to the World Trade Organisation's TRIPs protocol, this bill also contains a number of important measures, which we first sought to progress in Labor's IP Laws Amendment Bill 2013. Those measures included: firstly, extending the jurisdiction of the Federal Circuit Court to include plant breeders rights; secondly, allowing for a single trans-Tasman patent attorney regime and single patent application processes for Australia and New Zealand; and, thirdly, minor administrative changes to the Patents Act, the Trade Marks Act and the Designs Act.

I will turn for a moment to plant breeder's rights. Schedule 3 of this bill amends the Plant Breeder's Rights Act to enable the owners of the plant breeder's rights to take action against alleged IP infringements in the Federal Circuit Court. The amendment will provide a quicker and more efficient means of resolving disputes about the infringement of plant breeder's rights which could previously only be dealt with in the Federal and High Courts.

With respect to the single Australian-New Zealand patent examination process, the bill also makes some changes. Schedule 4 of this bill proposes a single patent application and examination process and a single trans-Tasman patent attorney regime to support the single economic market arrangements between Australia and New Zealand. The aim of these amendments is to streamline the process for applying for patents in Australia and New Zealand, thus reducing duplication and saving costs for investors and inventors.

I now turn to the administrative matters. Schedule 5 of the bill contains a number of minor administrative matters, including removing document retention provisions in the Patents Act, the Trade Marks Act and the Designs Act so that IP Australia's retention of documents is governed only by the Archives Act. It also makes changes to minor oversights in the drafting of the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 and technical corrections to drafting oversights in the Patents Act.

The major difference between Labor's 2013 bill and this bill is the deletion of schedule 1 of the 2013 bill, which modified the operation of Crown use provisions. Crown use is an important but rarely used safeguard that allows governments to access patented inventions without the owner's authorisation and can be invoked when an invention is used for the services of the Commonwealth or a state. It is an exceptional use that enables the government to use a patent for the benefit of community need without first negotiating a licence. Crown use provisions are currently enshrined in sections 163 to 170 of the Patents Act. Governments can apply Crown use provisions in a similar way to compulsory licensing; however, the Crown use provisions are a less costly and more effective option. With Crown use, patented inventions can be used without first seeking the owner's permission. The patent holder is, however, entitled to remuneration.

Crown use provisions provide a safeguard to ensure that the patents system does not prevent the government from acting in the public interest. Labor's bill would have amended the Patents Act to clarify the scope of Crown use and its operation. Schedule 1 of Labor's bill made it clear that Crown use can be exercised when an Australian state or territory government has the primary responsibility for providing or funding the provisions of a service. Labor introduced these measures in response to community concerns regarding gene patents and access to health care and to clarify the circumstances where governments could intervene to address unreasonable patent holder conduct that could result in patients being denied reasonable access to health care.

The Productivity Commission examined Crown use in its inquiry Compulsory licensing of patents that was released in March 2013. Their report addressed several reasons why Crown use provisions were rarely used. These issues were what schedule 1 of Labor's Intellectual Property Laws Amendment Bill 2013 sought to address, specifically in response to community concerns on the issue of gene patents and health care. While the bill currently before the parliament does not include Labor's measures around Crown use, it does contain other important changes which are indeed long overdue. However, we note the removal of Crown use provisions and call on the government to continue monitoring the situation with gene patents and access to health care very closely.

I now turn to Crown use and gene patents. In recent years there has been growing debate over gene patents and their impact on research and access to health care. In government, Labor took this issue very seriously and implemented a number of measures to address community concerns around gene patents, including multiple reviews and long-running consultation processes, while still maintaining a strong patents system that encourages innovation. In Australia there have been three substantial government reviews of gene patents in the past decade and several inquiries have been conducted into the impact of gene patents on access to health care—namely, the 2004 Australian Law Reform Commission report on genes and ingenuity, the 2010 Senate Community Affairs References Committee report on gene patents and the 2011 Senate Constitutional and Legal Affairs Legislation Committee report on the Patent Amendment (Human Genes and Biological Materials) Bill 2010.

The 2004 Australian Law Reform Commission review made a number of recommendations, including amendments to the Patents Act, that specify healthcare services or products as a rationale for invoking Crown use provisions. The report noted that, while Crown use provisions are rarely used, they constitute an important mechanism in helping to ensure that patent protection does not adversely affect significant public interest. The Australian Law Reform Commission did not recommend amending the Patents Act to exclude genetic materials or technologies from patentability.

As I said at the outset, this legislation effectively implements legislation that was introduced in this place just over a year ago by the previous Labor government. There are some minor differences but, notwithstanding those differences, we believe these measures are long overdue. Labor will be supporting this bill.

Andrew Laming (Bowman, Liberal Party) Share this | Link to this | Hansard source

The Intellectual Property Laws Amendment Bill 2014 this afternoon gives me an opportunity to talk about the TRIPS agreement, which over the last decade has slowly come to fruition, after recognition late in the last century that the market failure that exists in developing economies made it almost impossible for us to have a realistic crack at the great killers of TB, malaria and AIDS-HIV in particular. We have seen in the last 10 years significant advances since the work first began. Much of it emanated from Harvard University. Jeffrey Sachs and Michael Kremer, an economist from the Harvard University School of Economics, brought this issue to public recognition. In this debate today, where we finally connect the TRIPS agreement after at least seven years of waiting since it was drafted, we recognise the work that occurred 10 years ago.

It was Kremer who published 'Pharmaceuticals and the developing world', which was a really important contribution in 2002. Some of the initial drafts of that document back in 1999 came to my attention as a young student looking for an area of important international health to work on.

At that time it was important to recognise that the market failure that really prevented major pharmaceutical corporations from taking cutting-edge drugs to the developing world was a problem for which we had no solution—and it was not that long ago. At the time, the concept was to turn to wealthy countries and ask them for a contribution to a fund proportional to their GDP, which would act as a pool mechanism so that as great drugs potentially came along for which pharmaceutical manufacturers knew there was no large financial market because the disease primarily existed in the developing world, a fund would effectively pull it through the stages to eventually see that drug being approved.

We had two types of diseases to consider. Firstly, we had conditions like HIV that were a significant problem and offered financial revenue in developed economies and, therefore, could be taken to the developing world. Secondly, we had the diseases that existed almost exclusively in the developing world. These are the ones that have huge amounts of morbidity. The diseases are known to us in wealthy countries but, of course, they afflict millions in the developing world. The list of those include:Chagas disease and dengue, hookworm, Japanese encephalitis, lymphatic filariasis, oncocytosis, schistosomiasis, and trachoma—with the exception that it exists in Australia. For those diseases, we know there are millions of people affected but that there is not really any revenue model to get the research happening because pharmaceutical manufacturers know that there is not really a great market there.

There is no market there for three reasons. First of all, these are relatively small economies with large populations and very, very low GDP per capita. There is no real market to purchase these pharmaceuticals and no way of distributing them. And, of course, the positive externalities of people seeking out treatments for preventing infectious diseases from spreading simply do not exist because people have given up seeking medical treatments in many cases.

That challenge, of course, was far less complex with HIV because, since at least 1984 when it was first known as HTLV, there has been a worldwide effort to find cures for HIV. We are now in a position where, while we cannot eradicate the virus, although we think we have come very close on occasion, we know that people will most commonly live and die with the disease rather than from it. So there have been remarkable breakthrough drugs and just getting them to the developing world has become a simpler process—and that is where TRIPS came in. We acknowledge that the drugs were being created, but we did not want to undermine the First World market by producing large amounts of this drug and delivering them to the Third World. First of all, that undermines any market there might be in those countries. Secondly, you have the risk that these drugs are purloined, taken across borders or actually sold in poor countries to the wealthy populations that live there. All of this would undermine the market proposition for these companies who might otherwise consider doing it.

As a result, TRIPS was, I think, ingenious, and really changed the way we were thinking. Back in 1999, Kremer's initial thoughts were about creating this fund that would make pharmaceutical companies say, 'Well, we have this molecule; it is going to costs hundreds of thousands or millions to develop. But at least we know there is a pot of money at the end.' That pot of money at the end of the rainbow just proved to be a little bit too tricky. In the end, we have fallen back to the more realistic goal of using the market to develop world-leading drugs and then going to the manufacturer and saying, 'You have a great drug that can work in the developing world. We will pay you to license generic manufacture of your drug at super low prices, and the wealthy countries will compensate you for your losses by selling that drug to the developing world to people who could never afford it.' That proved to be, I guess you could say, a more practical approach to the problem.

Globally, what we know is that in this effort to take technology to the poorest parts of the world, we have a different experience here in developed nations than we have right now in developing economies. Traditionally, the old way of doing it was to wait for income to increase. As income increased, health also improved. That is the correlation between more income and being able to purchase better health. That is what we saw in developed economies. This was really interesting work done by Rob Fogel, who found that the 50 per cent health improvement and the fall in death rates in the UK and the 70 per cent improvement in the US actually happened before 1911. That means it happened pre-drugs and pre-technology, effectively—certainly pre-antibiotics.

That was the developed experience. But in the developing world, it is really completely different. For example, Vietnam has a GDP per capita about 10th of that of the US at the start of last century, but their life expectancy is already 20 years longer. Something different is happening in the developed world now. Even in Africa, with a lot of the instability there, we saw that the GDP fell between 1972 and 1992 by over 10 per cent. But even in that time of falling GDP, we were seeing falls in infant mortality and improvements in longevity, which obviously was independent of either GDP or household earnings. So this is the new challenge then. We cannot afford to wait for the developing world to turn around. We cannot afford to wait for incomes to rise. We cannot take that standing-back approach to build capacity and wealth and hope that health will rise with it. We now have technology—a frontier which can move into even the most poor and dysfunctional communities and improve health. I guess that is the path that we have now taken.

Samuel Preston estimated, even in the 70s, that income growth was probably only accounting for between 10 and 25 per cent of the improvement in health. Dean Jamison, as recently as 2001, was even more precise. He attributed, I think, over 70 per cent of the decline in infant mortality rates between 1962 and 87 to technology alone—21 per cent to better education and, really, only about five per cent of that improvement due to growth in income. So the general belief now is that we cannot wait for improvements in capacity. We have to give ownership of these solutions to countries themselves, because they know what works. But in the end there are very elaborate partnerships supported by TRIPS, which include your bilateral and multilateral agreements. You have the faith organisations, NGOs, the private sector brought in and then, of course, agreements with government. It is a very complex partnership that underpins it.

This, of course, is at the heart of the Global Fund. The Global Fund is there to specifically focus on those three big killers—AIDS, tuberculosis and malaria. They have just taken a very simple approach—a large pot of money, listening to the countries of origin and where the work is being done, and giving them full control over it by having a process that does not advance unless every one of those parties that I have just listed is involved. Getting government and civil society working together is not new. We have NGOs all over the world—often poorly coordinated but doing their best in resource-sparse environments. What has changed in the last 10 years is a general reaching out to the private sector, realising that you just have to have the engine room of intellectual property making a difference in the developing world, and there was a time, as recently as 2000, when we really had not woken up to that. That has been a very, very significant shift.

The Bill and Melinda Gates Foundation has also made an extraordinary mark just in the last 20 years. I can remember when the foundation first visited the World Bank. It was in 2000. Even at that time, the World Bank was more focused on reducing corruption in its dealings with developing economies than it was with elaborate private sector partnerships. So when the Bill and Melinda Gates Foundation came along with an utterly different approach, I can remember the impact that it had in Washington. Basically, the foundation turned up and asked: 'What are the diseases for which there is a cure but which is not available in those countries?' There was a big long list. There was a very simple piece of arithmetic done. The foundation simply asked, 'How many people are affected? How much does the drug cost? How much does it cost to deliver?' They multiplied those together and wrote a cheque. This was an extraordinary change in the way aid was delivered. The foundation simply said, 'Our goal is not to have as many diseases with as many people afflicted at the end of our work. We want to start eradicating disease full stop.'

This new look at how aid can be delivered is not about how much you have to give but about pausing to work out how much it would cost to get to the goal. You agree on the goal and then you work backwards. You work backwards from that and ask, 'Is this a realistic goal that we can achieve within a lifetime, within a decade or within a year?' This is about looking at it from the other side and saying, 'We will not stop until this is achieved.' It will be utterly futile unless we take that approach which looks at the destination rather than simply the positive feelings of being part of a journey.

The TRIPS agreement took a long time to connect up here. I have to note that in six years of a Labor government this process could have been accelerated but it was not. These things are way too urgent to wait. This was something that was drafted and generally agreed to in 2007 and here we are finally dealing with it today in 2014. That is a source of concern. They are an opposition that feel very comfortable taking the high moral ground on foreign aid, but with all of their domestic disputes and troubles they found it almost impossible to take really meaningful steps in government. There were 100 countries affected by diseases for which cures were not available who had to wait for the duration of that six years of Labor government until there was a coalition government to finally get this moving.

I do not want to become too partisan in these comments, but there is a sense that Labor is easily distracted by other matters and often forgets that there are simpler, red-tape-free ways of getting things done. Again, agreements between New Zealand and Australia are way more complex than we thought when we first embarked, but this effort to get a combined Australia-New Zealand therapeutic goods administration is well worth pursuing. Although we possibly underestimated its complexity, having a single trans-Tasman agreement within IP is certainly an excellent idea.

My focus today was primarily on TRIPS because I think that is the headline story from this legislation. We now have a way of directly incentivising the generic production of breakthrough drugs for the developing world. I really wanted to point out in my speech today that 10 or 15 years ago that was not even contemplated; we were heading in the other direction. But now in economies such as in sub-Saharan Africa, where 38 countries spend less on health in total than the single state of Connecticut in the US, we can start to make a difference for populations there even when their own governments do not share the same passion for diverting and maintaining investment in health. There is not a high enough recognition that health underpins economic outcomes in those countries. Until we have the capability and sophistication within those governments to have that focus on health and human development, in the meantime we will have these very fertile partnerships between the world's biggest pharmaceutical manufacturers, the world's biggest technological developers, those who are coming up with the bright ideas that are the subject of IP, particularly here in Australia, civil society and government. I look forward to those partnerships developing further.

Alannah Mactiernan (Perth, Australian Labor Party) Share this | Link to this | Hansard source

I was going to begin by complimenting the member for Bowman on an excellent speech. He did blot his copybook towards the end, but I think he gave a very powerful and important explanation of the importance of TRIPS and the role that this legislation will play in ensuring that Third World communities have access to the drugs they need to deal with very severe conditions and to overcome some of the fundamental inequity that exists across the planet where people who are most in need of medical assistance and advanced pharmaceuticals so often simply do not have access to them. I want to compliment him, as I said, for explaining that in very considerable detail.

He did, however, blot his copybook somewhat towards the end because he misrepresented the case of who, in fact, first proposed this legislation. The legislation in relation to TRIPS, as we all know, first came before this parliament in 2013. It was a piece of legislation promoted by the Labor government. But at that time, in keeping with the 'just say no' approach of the then opposition, it was objected to by the opposition and described as inadequate, incompetent legislation by the now departed former member for Indi. We now see this legislation being brought back into this place, and it does have the support of the opposition.

There were just a couple of matters that I wanted to raise here today. The first is one of the things that is not in the bill. There has been an entire area of difference between the Labor bill and the bill now before the House—and that is, as my colleague earlier mentioned, the removal of the Crown use provisions. These are provisions that already existed within patent law that allow the Crown, from time to time, to utilise patents for public purposes without necessarily obtaining the licence of patent holder. Governments are required to pay compensation for that use, so it is not something that will detract from the economic position of the patent holder. This is in order to ensure that public good is protected by patent law.

At the end of the day, patent law is the gift of the state to the private patent holder, going right back to the days of the woollen stockings that were the first subject of patent protection in the United Kingdom in order to encourage the French manufacturers to come over and bring their worsted stockings to England. So it is very much a gift, and part of the Crown use provision is a recognition that from time to time there is an important role for the state in accessing those patents and having the capacity to do so. There has not in fact been all that much Crown use of patents in Australia—I think we have found half a dozen cases where this has been invoked, two of which have been contested—but I think this is an issue that will become increasingly important because of this issue of gene patenting.

There is a great deal of concern in the community about gene patenting. Amongst many people, including cancer survivors, the ability to patent a gene mutation such as the BRCA mutations for breast cancer is really seen to be quite repugnant. People find it very difficult. I will just read an email I received the other day from a Lesley Keegan. Lesley says:

I can't say how disgusted I am with Australian Patent laws which is in the process of allowing the patenting of genes. This isn't about saving lives, this is about making money. It is happening in every genetic research sector including one close to my heart, the genetic heart research sector … I have had the misfortune to have had contact with people within the genetic heart research sector. My opinion is and has been for quite a while that there is something intrinsically wrong with the system.

We have seen the same from breast cancer survivors.

This is a very complex area. In the 2004 report—and I think it was one of the first and most comprehensive reports on this whole issue of patenting of genetic material and whether or not we should allow it—the Law Reform Commission certainly expressed that they were sympathetic to the concerns of the public about the patenting of genetic material. But they made the point that if had been addressed in the 1980s, just as the capacity to do this detailed genetic sequencing was emerging and as the activity of private laboratories in this area was emerging, it may well have been possible to do something. The point they made in the 2004 report, in the 2009 submission to the Senate inquiry and, I think, in the subsequent 2013 inquiry was that the 'gene genie', if I can say that, is out of the bottle and there have now been so many patents granted in this area—tens of thousands—that it would be difficult to unwind that. So they recognised the problem, but we have really gone too far down the track, in their view, to unwind this.

What they proposed instead was that we modernise and make more accessible these Crown use provisions. These Crown use provisions were to be modified and strengthened so that, if there were a situation where access to genetic material is not made available to allow treatment or further research and development to take place and the development of realistic and affordable solutions for people who suffer from genetic mutations is blocked—and there are people who are fearful that this is the case—then the Crown use provision would enable the government to override the exclusivity of the patent and ensure proper compensation. Nevertheless it would provide a level of protection. Unfortunately, the government of the day has decided that it is not going to do that. It is not going to act in accordance with the recommendations of the Australian Law Reform Commission in this regard and it is not going to allow the Crown use provisions to be strengthened and modernised so that they create this fallback position.

There is one other item I wanted to comment briefly on, and it is plant breeders' rights. The bill before us provides for a more accessible regime, with greater accessibility to courts for a more speedy resolution of disputes relating to plant breeders' rights. Of course, that is important. These can be very expensive processes. But I will just make the observation that I think there is a great future in genetic modification of crops. I do understand concern in sectors of the community about GM, but it is science and it is progress. It can enable us to do extraordinary things—to take genes for drought resistance from plants in African deserts, incorporate them into food crops and ensure that we can deal with some of the consequences of climate change on the drying continent that we are facing here in Australia.

So I think there is great potential for GM, but one of the really big risks that we face is the conduct of the companies that own the GM rights. I do not think that we have the legal regime here right. Some of the really unfair treatment of people whose crops have been corrupted—or infiltrated—by GM crops and who then found themselves on the receiving end of penalties is quite extraordinary. Until we resolve that legal issue, until we have a fairer regime for those farmers who choose, as they should be able, not to go down the GM path they will continue to have that two concerns. One concern is their ability to protect their product, but an even more profound concern is that if they are unwittingly the subject of an invasion by seed from GM plantations not only is their economic model undermined but they can become financially liable for having expropriated the stock and genetic material of the seed company. That is a completely untenable position and one of the things that are standing in the way of there being a wider spread acceptance of GM crops. I really do urge this. I know it is not the issue that is dealt with centrally here, but with this bill we are making it easier to take action under plant breeders' rights. Part of the sequel of that has to be to make sure that those rights are fair and protect the interests of non-GM farmers as well.

We support this legislation. We are particularly enthusiastic about the implementation of the TRIPS regime. We are not an opposition that just says 'no' as a matter of course, as is shown here by our support, notwithstanding the fact that an almost identical bill was opposed the Conservatives when they were in opposition. I am happy to support this bill, and I commend it to the House.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

I am pleased to rise to speak on the Intellectual Property Laws Amendment Bill 2014. The purpose of this bill is to make a range of improvements to Australia's intellectual property laws to increase their efficiency and effectiveness and to reduce red tape for business, something we need to do more and more of. The amendments in the bill make changes to the Patents Act 1990, the Trade Marks Act 1995, the Designs Act 2003 and Plant Breeder's Rights Act 1994 and are divided into five schedules.

Schedules 1 and 2 of the bill deal with implementing the TRIPS protocols. Many developing countries simply do not have the economic wealth and have difficulty in manufacturing and accessing patents of pharmaceuticals. They are unable to respond to many of the serious health problems, such as HIV, malaria and tuberculosis, in the world today. Millions of people die from these diseases every year. This bill will amend the Patents Act to allow Australian generic pharmaceutical manufacturers to supply these countries with the patented medicines they need by producing them as a generic. The amendments will deliver on the government's commitment to implement the protocol amendment of the World Trade Organization agreement. Under this protocol the manufacturer is able to apply to the Federal Court for a compulsory licence to manufacture generic versions of patented medicines and export these medicines to developing countries.

The particular drugs that this bill mentions are for malaria. In 2012 the World Health Organization estimated that there were 627,000 deaths from malaria. It also mentions drugs for HIV-AIDS. In 2012, again, the World Health Organization estimated that there were 1.6 million deaths worldwide from HIV-AIDS. For tuberculosis, the World Health Organization estimated there were 1.3 million deaths.

But there is an environmental problem that causes more deaths than those three ailments together, indoor air pollution. In many parts of the world today people are denied access to low-cost and abundant supplies of electricity. They are forced to use renewable sources of energy, such as twigs, dung and crop waste. They burn that inside the house and the resulting indoor air pollution causes 4.3 million deaths annually, the World Health Organization estimates. Yes, it is a great move to make those drugs available to tackle diseases in the Third World, but we need to tackle indoor air pollution in Third World countries, because it is a greater killer than those three diseases combined.

Schedule 3 of the bill deals with plant breeders' rights. It enables people who have an intellectual property right as a plant breeder to take action in the Federal Circuit Court instead of having to go to the Federal Court, which theoretically should lower their costs. The reason we should be encouraging our plant breeders, especially many of our small businesses, is the importance of increasing crop yields. In 1961, over 50 years ago, we were feeding 3.5 billion people. To do so, we were cultivating 1.37 billion hectares of land. Since then the global population has doubled to more than seven billion, but because we have been able to improve our plant breeding we have had greater crop yields. Those greater crop yields have meant that we can feed double the population that we fed 50 years ago with only a 12 percent increase in land. We need to continue those improvements in crop yield. That is why it is important that we encourage plant breeders' rights, so we continue to increase crop yields.

The fourth schedule helps to work to bring Australian and New Zealand economic relations closer. At the moment, patent applications filed in New Zealand have to be filed separately in Australia. There is a duplication of the process. This bill will streamline the process, following a single patent application and examination process in both Australia and New Zealand. It will reduce duplication. It will make it cheaper and easier for both Australian and New Zealand businesses to access both markets. It also provides for a single register of patent attorneys. And I know there are many New Zealand patent attorneys who will have the opportunity to practise their trade here in Australia, and vice versa. This is important. Having closer economic relations with our kiwi cousins benefits both our countries. It is also important that the intellectual property laws in those two countries become more closely aligned. There are a few small differences between Australia's intellectual property laws and those of New Zealand, and we should we working to ensure that those differences are minimised and reduced, and that will benefit both countries.

The fifth and final schedule will simply reduce a bit of the regulatory burden with some unnecessary documentation retention provisions in the patents, trademarks and design act. Repealing those provisions will allow IP Australia to dispose of unnecessary IP documents, saving hundreds of thousands of dollars in warehousing costs. In this economic environment, where every single month our nation has to pay $1 billion just to service the interest, without repaying any of the principal debt that was run up over the past six years, every single cent we can save is important. This is another step that this government is proceeding with in reducing the red and green tape. On the subject of intellectual property laws, we need to remember that the entire reason that the government interferes in the market and has this regulatory system is to drive innovation. The intellectual property laws are not there to create and protect monopolies. It is all about driving innovation. In saying that, we need to recognise that simply making more and more and stronger and more stringent intellectual property rights does not necessarily lead to an increase in innovation.

That is especially true with the fashion industry. A paper was written a few years ago by Kal Raustiala and Christopher Sprigman from the University of California and the New York School of Law. It was called 'The piracy paradox'. In that paper they note that the fashion industry has very low IP protection. Other than trademarks and the designs in a fabric, the simple cut or shape of clothing does not have any intellectual property protection. These authors said that this has actually been to the benefit of the fashion industry and that it has created and has been a driver of innovation. The dilemma is that not having intellectual property protection underpins the economics of the fashion industry. They said that the industry needs to keep growing and, for it to keep growing, customers need to want to keep replacing the clothes they have and buying tomorrow's fashions. To do that, they have to become dissatisfied with the fashions they are currently wearing. Their argument is that the continued copying we see in much of the retail sector in the designs of clothing actually brings in an induced obsolescence. The researchers argue that no-one 'cool' wants to keep wearing something after everyone else is wearing it, so the continual copying drives that obsolescence. They said that this results in an industry where there is more innovation, more competition and probably more sales than there would be if there were strong intellectual property protection rights. The other reason they give for having low intellectual property rights in the fashion industry and for how it actually drives innovation and creates wealth is that it creates what they call 'aspirational utility', where people actually get enjoyment from imitating the lifestyles of the rich and famous. They say it is like a gateway to drugs. Giving people access to a lower-quality version makes them more interested in getting the real stuff and increases the brand value of the real stuff.

For example, several years ago, before I became a member of this House, I was in New York City on business. I was walking down Fifth Avenue, and there was the Louis Vuitton shop, with all the bright lights and the bags in the window—a magnificent example of high-end retailing. When I came back later that night the shop had closed—I think it was after six o'clock—and out the front there were a couple of hawkers on the street, selling knock-off versions of Louis Vuitton bags. You would think that would destroy the brand. But we have seen over the years that all those high-end fashion brands, despite that copying and those knock-offs, are becoming stronger and that their brands are becoming worth more. That is what the Professors Raustiala and Sprigman call the piracy paradox. That brings me to a recent decision of the Federal Court of Australia in a case between Seafolly and its competitor, City Beach. Seafolly had several fabric designs and City Beach was found by the court to have infringed those designs.

I seek leave of the House to table the colour photographs of those designs, because without seeing them it is difficult to make sense of what I am talking about.

Leave granted.

These were rose floral designs, which I think were on many of my grandmother's dinner sets. The courts have found that there are variations in the designs and they have been granted copyright protection. They awarded penalties and costs of over $½ million in this case. I believe this was a very poor decision, and anyone who looks at the two designs will think it is a poor decision. But the court said that City Beach took inspiration from Seafolly, being the market leader.

This decision and these comments show, with the greatest respect to the courts, that their understanding of how consumer products are produced and designed is completely naive. Everyone who is not the market leader is looking to the products the market leader has. No matter what consumer product you look at, whether it be cars, fashion or whatever other product, that is how our system works—companies look to the market leader for inspiration. For the courts to criticise that is very ill-judged and sets a very bad precedent.

I believe this decision is going to cause great difficulty in the fashion industry in Australia. It means that, if a young fashion designer comes up with their own design, something they think is unique and new—and we know most designs are based at least in part on things that have gone before—a large incumbent player can simply have their legal team write to them and say, 'You have infringed our copyright, because it is close to something we do.' While at first blush the young designer may say, 'This is ridiculous', the legal team of the large player can simply pull out the precedents in these decisions and say, 'Take a look at these and withdraw your product from the market.'

The decision of the court in this recent case will reduce competition and reduce innovation. The ultimate losers will be the Australian consumer. I therefore believe this is an issue parliament needs to look at, because we need a vibrant fashion industry. We want to encourage young fashion designers in this country to get out and create new designs—and to market them not just here in Australia but to the world. With that, I commend this bill to the House. It makes a few major improvements to intellectual property right laws, but this recent Federal Court decision means we have more work to do in this area.

Pat Conroy (Charlton, Australian Labor Party) Share this | Link to this | Hansard source

The main purpose of the Intellectual Property Laws Amendment Bill 2014 is to implement the WTO's Trade-Related Aspects of Intellectual Property Protocol, known as the TRIPS Protocol. This is an agreement that enables a country that is experiencing a serious epidemic to access patented drugs and for countries with limited or no manufacturing capacity to access patented pharmaceuticals made under compulsory licence in another WTO country. The TRIPS Protocol encourages patent owners to either provide medicines to least developed countries at affordable prices or to issue a voluntary licence to generic manufacturers to provide medicines at affordable prices. If a patent owner is unwilling to do either of these things, the protocol provides a mechanism to force the patent owner to issue a compulsory licence.

Australia has been a signatory to the TRIPS Agreement since 2007 but has yet to implement these provisions via legislation. I will highlight, later in my contribution, some of the reasons for this delay. Other aspects of the bill include amendments to the Plant Breeder's Rights Act to allow disputes over IP infringements to be heard in the Federal Circuit Court, which I think it is good move—as highlighted by the member for Hughes in his contribution.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

So you agree with me!

Pat Conroy (Charlton, Australian Labor Party) Share this | Link to this | Hansard source

It is rare, I agree, but I am glad to be able to throw you a bone. I will disagree with you a bit later, so do not get too excited. The bill proposes a single patent application and examination process and reduces duplication in the process of applying for patents in Australia and New Zealand. It changes various acts in relation to retention of documents so that IP Australia is only governed by the Archives Act, as well as making some technical corrections and rectifying some drafting oversights. These measures are all designed to improve efficiency and consistency in the area of IP—and, as the last speaker said, to reduce red tape.

This bill has been a long time coming.    The Labor government introduced a similar bill last year. However, this current version deserves some scrutiny—because it is in both its similarities to and its differences from the former bill that we can see the contrast in values between those on that side of the House and those on this side, particularly when it comes to support for science, innovation and emerging industries.

I will deal with the similarities between this bill and Labor's bill first. Despite their vocal—and in some cases ludicrous—objections to the former bill, the government have offered up an almost identical set of amendments relating to the WTO's TRIPS Protocol.    As I said earlier, these amendments have been a long time coming. It was 1995 when the TRIPS Agreement came into force, from which global minimum standards for intellectual property regulation with regard to pharmaceutical products were applied for the first time. Since the Doha Declaration in 2001, the scope of the TRIPS Protocol has been viewed from the perspective of the simple goal of 'promoting access to medicines for all'—because the right to be healthy is a fundamental one. It is a basic human right and medicines play a crucial role.

Patenting is important because it provides an incentive for innovation, particularly in the pharmaceutical sector, where there is a high level of expenditure on research and development, as well as on production technologies. Indeed, were it not for the patent process, many pharmaceuticals would simply not be developed and the opportunity for them to benefit society would not exist. But generic drugs also play an important role in ensuring the supply of medicine at affordable prices and there is an undeniable social benefit to the distribution of these products in developing countries, particularly in response to the outbreak of sudden health crises or the prolonged spread of disease.

This bill will enable manufacturers of generic medicines to apply to the Federal Court for a compulsory licence to make and export patented products to the least developed countries that are experiencing a health crisis of this kind. According to the World Health Organisation, there are over 100 countries currently experiencing one or more serious epidemics. In 2011, an estimated 262 million people were infected with malaria, HIV-AIDS or tuberculosis. This caused 3.8 million deaths. Most of these were in developing countries which do not have the capacity to manufacture or distribute the medicine which is needed to save people's lives.

Australia is a compassionate country and Australians would be rightly proud of their legislators for enabling this protocol within the framework of our IP laws.    It must be noted, however, that the course of this legislation in this place has not been smooth. I was astounded by the contribution of the member for Bowman. The first half of his speech was very well considered and, I think, a great contribution to the debate. The second half was a frolic into rewriting history in which he had the gall to condemn the Labor Party for not progressing this bill while we were in government! Why did we not progress this bill in government? It was because those on the other side opposed it. If you look at the Votes and Proceedings for 24 June 2013, it shows there were 68 members who voted against the second reading of the bill, including many on the other side now. There were some particularly vocal opponents, including the former member for Indi, Sophie Mirabella, and the member for Tangney, who remains in parliament today. They were concerned that, in the spirit of the humanitarian principles of the TRIPS protocol and in accordance with the exclusions within it, Australia was not prepared to refuse assistance to a country in need should it not be a member of the WTO.

In fact, Ms Mirabella in this place mused that not withholding life-saving medication to non-member countries would reduce the incentive for them to join the WTO—a perverse notion that effectively holds sick people and vulnerable people to ransom. Let me repeat: Ms Mirabella was arguing that this bill should be opposed because giving free or cheap medicine to developing countries to help them solve epidemics would reduce their incentive to join the WTO. What a heartless and sickening idea.

Dr Jensen, the member for Tangney, took the idea even further. He accused the former Gillard government of embarking on treason by allowing this provision. When questioned on this matter, Dr Philip Noonan, the then Director General of IP Australia, said:

It is certainly possible to say that maybe the TRIPS agreement should not extend to countries like East Timor, but the bill very clearly, in the explanatory memorandum, adopts the policy position that it should extend to every country, because if a country were to come to us and say, 'We have a health emergency; you're the only one that can help us,' then it would just be an unreasonable position to say, 'No, you don't belong to a particular club; we can't help you.'

What a wise contribution by Dr Noonan. Those on the other side, led by Ms Mirabella, argued that we should let these people die, because not doing so reduces their incentive to join the WTO. Dr Jensen, as I said, suggested that it was a treasonous act by the Labor government. By his logic, the Abbott government is now pursuing a treasonous course of action by including in this legislation provisions that make it very clear that we will provide these medicines to non-WTO countries.

I am pleased to see that the Liberal government has come to the realisation that we were right, and that it is extending the scheme to non-WTO members—as Canada, Norway and Switzerland have already done. This will be particularly important in our region, as it includes countries, like Timor Leste, who have not joined the WTO. So I am very glad to see that the Abbott government is rejecting the flawed, cynical and, quite frankly, perverse policy position of Ms Mirabella and the member for Tangney.

This bill differs from last year's version significantly through its omission of Crown use provisions, which allow the government to use a patented invention without the owner's authorisation or first negotiating a licence for the services of the Commonwealth or state. These amendments would have delivered certainty to the government and the community that the patent system would not prevent us acting in the public interest, should the need arise, in one of the most fundamental services the people of Australia expect us to provide—health care. This is particularly relevant to the area of gene patents, where there has been growing debate over recent years with regard to their use in health care.

As I have already said, there is a need to balance the known safeguards that patents provide with the right for patients to access treatments in a timely and affordable way. There is also a need to ensure that progress is not stifled and that policy settings are right to give scientists the confidence to pursue their research, with the prospect of a return on their investment. Labor's amendments to the Patents Act would have done that. They would have ensured that our policy settings were keeping pace with technological advancements and that the public's right to access health care was preserved, whilst supporting our world-leading medical research sector, which is so valuable.

Labor's bill was developed in response to a string of research on this issue, including the 2004 Australian Law Reform Commission report on genes, the 2010 Senate committee report on gene patents, the 2011 Senate Legal and Constitutional Affairs Legislation Committee report on the Patent Amendment (Human Genes and Biological Materials) Bill 2010, and the 2013 Productivity Commission report into the compulsory licensing of patents, which made a very clear recommendation that the bill would have implemented. It also built on the former Labor government's legislation which allowed researchers to carry out their research without being blocked by patents.

The government's removal of the Crown use provisions is symbolic of this government's lack of support for innovation and science in this country. This is a government that has no science minister. For the first time in over 60 years, we do not have a science minister. This is a government that has cut the CSIRO budget by $114 million. This is a government that builds on the Howard government's disgraceful legacy of slashing the R&D tax concession when they came to power in 1996. This is a government that, so far, has rejected the $350 million venture capital fund put forward by Labor that would support innovative small businesses. This is a government that, so far, has rejected the $500 million precincts measure that would really drive innovation in this country.

This bill contains some very laudable measures, which I applaud, but it omits significant provisions that would advance research in this country and provide certainty for government and the community. It builds on the appalling legacy of those opposite in rejecting science, rejecting funding for science, rejecting innovation and rejecting funding for innovation. Nevertheless, Labor will support the current bill because it contains a number of important measures that we agree with and that will provide a better regulatory framework within which technologies can develop and new industries can emerge. Perhaps most importantly, it can help save the lives of those most in need.

We remain concerned about the removal of Crown use provisions and expect that the government will continue to review this and introduce separate legislation to ultimately amend the Patents Act. We will not, as those opposite did when they were presented with the same opportunity, oppose these measures simply for opposition's sake. We will not, as some of those opposite did, make vehement statements against what is essentially a compassionate and humanitarian act. Rather, we will support the government and commend it for finally upholding Australia's commitment to the World Health Organization and for including the TRIPS protocol in our IP laws.

Ken Wyatt (Hasluck, Liberal Party) Share this | Link to this | Hansard source

It gives me a great deal of pleasure to rise today to speak to the Intellectual Property Laws Amendment Bill 2014. Many in this House would know that in the past I have spoken about IP laws and the need to protect our local innovators and entrepreneurs. I am on the record as saying that we need a strong, robust IP framework to support our investors in the future. Currently, the IP system takes applications from Australian businesses for trademarks, patents, designs and plant breeders rights to protect their brands and new ideas from being duplicated by competitors. To keep the framework strong and relevant, we must consistently review and build upon the existing protections afforded through legislation.

That is why I support this amendment bill, which will reduce unnecessary burden on our regulatory authority and strengthen our bilateral processes in an increasingly globalised society, particularly when it comes to intellectual property. We must ensure that Australia remains competitive in a fast-paced global fight in the search for the development of the next new thing emerging in new industries. This bill contains a number of measures that will improve the Australian IP system and makes amendments to the Patents Act 1990, the Trade Marks Act 1995, the Designs Act 2003 and the Plant Breeder's Rights Act 1994.

In 2007, the Howard government committed to implementing the protocol amending the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights, known as the TRIPS protocol.

Bruce Scott (Maranoa, Deputy-Speaker) Share this | Link to this | Hansard source

Order! The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour. The member will have leave to continue his remarks.