Matt O'Sullivan (WA, Liberal Party) Share this | Hansard source

I rise to speak on the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019. As part of our government's plan to grow our economy and create 1.25 million more jobs, we have a longstanding commitment to innovation and technology. This commitment has seen the economy create over 1.3 million jobs since we were elected. That's why Australia's economy is growing at 2.3 per cent—a stronger rate than the OECD average and all other G7 economies, except for the United States. We recognise that innovation is the catalyst for creating business and job opportunities in the future. As a government, we've demonstrated our commitment time and again to developing considered policies that get the right settings, and to providing unprecedented funding, informed by expert advice. We on this side of the chamber are making sure innovation includes all Australians. It's about bringing along traditional industries while we're also developing new technologies, industries and firms. And it's about making sure that this system remains accessible to all. Australia's intellectual property system makes an important contribution to the economy, because it promotes and incentivises investment in creativity, innovation, research and development.

This bill has been brought before the Senate by the government as a responsible and measured response to a Productivity Commission report which recommended a range of improvements to our IP arrangements. The commission completed its public inquiry into Australia's IP arrangements and published its first inquiry report on 18 August 2016. They were asked to consider whether current IP arrangements provide an appropriate balance between access to ideas and products and encouraging innovation investment and the production of creative works. It's critical that this system not only keeps pace with expectations in the 21st century but remains accessible to all individuals and organisations seeking to have their good ideas protected, giving them the confidence they need to create and grow new businesses.

This bill represents the second set of legislative measures in response to their first report and proposes a number of technical fixes to the system. The singular focus and objective of Australia's intellectual property system is to support innovation and investment in the Australian economy, ensuring businesses have the confidence to grow, to employ more Australians and to keep our nation at the global forefront of developing new technologies, ensuring Australia's IP arrangements keep pace with advances in technology and new ways of doing business in an increasingly globalised world. This innovation and research plays a significant part and is critically important to ensuring our industries and universities remain on the cutting edge.

Nowhere is this more important and prevalent than in my home state of Western Australia. Acting Deputy President Brockman, you certainly know how important this is. Since the iron ore industry was opened up by Menzies and the Court government in the 1960s, our resources sector has been on a consistent and rapid trajectory of growth, enabled by significant advances in the homegrown development of technology which has increased production, productivity, efficiency and, very importantly, safety. We all know that this comes at significant cost. Over decades, we've seen billions and billions of dollars spent by industry, businesses large and small—in partnership with government—and research institutions on research and development activities.

Australia's strong intellectual property arrangements have played a critical role in providing the necessary confidence in protections to enable this development. Australia, and Western Australia in particular, would be a very different place if the system were not as robust as it is. Government and industry from around the globe are now looking to my home state of Western Australia to provide solutions and technology for their own industries. We see this in the resources sector, the agricultural sector and remote operations like the subsea and space sectors, just to name a few. As a direct result of research and development over the last few decades, we have now seen significant new opportunities from across a range of new and adjacent industrial sectors—which, on the face of it, seem to bear no relationship to each other—coming together to solve quite significant problems. Just look at our oil and gas industries and the mining sectors and see how they're contributing to the space industry. Just look at the space industry and how that stands to contribute to agriculture.

If I was to give one example of this type of collaboration being enabled in WA, it would be the partnership between Woodside Energy and NASA. If you go to the Woodside building in Perth, you'll find what they call a robonaut—a next-generation robot powered by artificial intelligence and technology, developed by our resources sector through decades of investment, trial and error and breakthrough after breakthrough in remote operations. And there are others. Rio Tinto and Fortescue Metals have remote operations controlled from systems operating out of Perth. It's fascinating to see this. But, with Woodside, it's intended that these robonauts will be deployed on the next space station. It's an exciting project which demonstrates what can be achieved when Australian industry has the confidence and environment to be creative, innovate and invest significantly in R&D. It's just one example of what we're doing as a state in this space.

The government's commitment to ensuring our IP arrangements remain strong is ongoing and unwavering. In 2015, the Productivity Commission was asked to undertake a comprehensive review of Australia's IP system. We wanted to ensure that it didn't just keep pace with community expectations and new ways we're doing business; we also wanted to look seriously at how accessible it is to innovators looking to protect their work in terms of the cost and process.

The government responded to the Productivity Commission's recommendations in August of 2017. The first bill, which implemented the government's response to the trade mark and plant breeders' rights system, passed through both houses of parliament in 2018. It was commended on its thorough stakeholder consultation by the Senate committee and received royal assent on 24 August 2018. This bill builds upon that. It's the next necessary step. This bill takes into account the extensive stakeholder consultation and addresses the recommendations made by the Productivity Commission to reform the patent system in schedule 1. It also includes amendments in response to a number of Productivity Commission recommendations made in its 2013 report into the compulsory licensing of patents in schedules 2 to 4.

Extensive consultation has been undertaken for this bill so that it provides stakeholders with several opportunities to provide feedback on the proposals. There's widespread agreement that the innovation patent—a second-tier patent system—is not working. The government's decision to phase out the innovation patent was based on an assessment of its impact on the innovation system and on the economy more broadly. We accept the amendments to this bill proposed by those opposite. These will require the government to review the accessibility of patents for small and medium sized enterprises in the 15 months after the bill is enacted. The phasing out of this innovation patents system will start 18 months after the bill is enacted, rather than 12 months after the enactment, so these are fine.

The system was intended to encourage SMEs to do more R&D, to protect their smaller inventions, but the top five applicants over recent years have been Apple and four large Chinese entities. This reform will remove the uncertainty and confusion around granted but unexamined patents in the system. It will prevent firms from using the system as a strategic tool in infringement matters and remove unnecessary costs on third parties and consumers generated by the system. We do not accept the amendments proposed by Senator Patrick to remove the amendments commencing the abolishment of the innovation patents system.

With regard to crown use, we recognise that this is a rarely used safeguard in the Patents Act 1990 that allows the government to access and use patented technology without authorisation from the patentee. These changes would clarify the circumstances in which crown use can be invoked, introduce a process of ministerial oversight and provide a clearly defined standard for the remuneration to be paid to the patentee. These amendments would increase the certainty and transparency of these provisions whilst protecting the rights of the patentee.

The changes made in this bill will amend the compulsory licensing provisions to replace the reasonable requirements of the public test with a new public interest test. The focus on the new public interest test will be whether demand for a product or service is being met on reasonable terms and whether access to a patented invention is essential for meeting that demand. These amendments will also improve the clarity and certainty of the legislation and strengthen the rights of the patentee, while allowing access to the patent only when it's in the public interest to do so. This bill will also make minor changes to the patents and trademarks acts to correct errors, streamline procedures and reduce red tape in applying for IP rights applications.

In conclusion, the benefits of these amendments are clear. There is a record number of Australian businesses undertaking innovation—innovation which is supported by this government. The Productivity Commission review was particularly important, with data demonstrating small businesses are leading the way, with over 60 per cent of all small firms classified as innovation-active. That's something that we can be very proud of in this country. We are leading the way. Technology and innovation can help businesses improve the way they're working and solve everyday problems. Ultimately, they're the key drivers of long-term job creation, which is, of course, something that we all need to be committed to. These activities are also growing our economy, creating jobs and providing more opportunities for all Australians. I commend this bill to the chamber.