With the introduction of the Designs Amendment Act 2021 (the Designs Amendment Act)1, design protection in Australia has received long-overdue reform to bring it into compliance with international standards,2 as well as domestic companion legislation, chiefly the Patents Act 1990 (Cth) (‘the Patents Act’).3 The Designs Amendment Act, which commenced in full on 10 March 2022, introduces a number of provisions intended to facilitate the early stages of design registration4 and allow the Designs Act 2003 (the Designs Act)5 to more effectively fulfill the overarching objective of the IP rights system: to support and encourage innovation in Australia.6 Notable changes introduced by the Designs Amendment Act include a 12 month grace period that protects owners against inadvertent disclosure of the design before an application is filed, and a prior use exemption to infringement by a third party that may arise as a result of the grace period. A summary of the key changes follows.
Schedule 1: Grace Period
Schedule 1 introduces a 12-month grace period allowing ‘a publication or use of a design … by a relevant entity’7 to be overlooked with regard to novelty considerations. Consequently, designers will now have an opportunity to retain rights to their designs should they be published on a social media platform or used in any capacity anywhere8, provided the design application is filed within 12 months from the disclosure. These amendments seek to further empower designers by extending grace period provisions to earlier versions (i.e., prototypes) of a subject design;9 by inserting grace period provision directly within the Designs Act rather than in the Designs Regulations 2004 (Cth) (the Regulations); and by placing the onus of establishing that any identical or substantially similar design (i.e., the ‘other design’) published after the subject design was the result of an independent creative effort on the part of the publisher of the other design.10
Importantly, the Designs Amendment Act does not extend grace period protection to designs which have been published by the Registrar of Designs or by an international official of equivalent standing,11 as doing so would undermine the purposeful intent of the prior art base and enable double design protection.12 Notably, this is a deviation from the Patents Act, where Commissioner publications are not excluded from the grace period, ‘allowing for dual patent protection in some circumstances.’13
Schedule 2: Infringement exemption for prior use
Schedule 2 introduces a prior use defense to protect third parties against infringement proceedings upon use of a product ‘which embodied a design’ during the grace period. The Designs Amendment Act extends the definition of ‘used’ with respect to a design to include made, imported, or sold.14 Critically, the exemption to infringement under amended section 71A of the Designs Act stipulates that the use had to commence on or before the priority date of the registered design and continues to protect the third party against infringement proceeds for use of the design after the design is registered. While third party use of a design after the priority date but before registration of the design is not exempt from infringement proceedings under amended section 71A of the Designs Act, such use may be suitable for an innocent infringer defence (see Schedule 4 discussions below).
The purpose of the Schedule 2 provisions is to rectify the balance between the rights of the designer and those of a third party who may have independently created a similar design or used a design which was disclosed during the grace period and for which the third party cannot be certain registration will be sought.15 For the purposes of the newly introduced provision, the design which was disclosed during the grace period is termed the ‘comparable design’,16 and designers should be made aware that the balance struck in this provision may limit their exclusive monopoly rights to a design following its premature disclosure.
Schedule 3: Registration of designs – removal of publication option
Schedule 3 provides one of several small changes in the Designs Amendment Act directed at streamlining the design application process. Specifically, this schedule removes the option to have a design published without registration. As amended, the Designs Act provides that upon filing an application, the applicant may make a request for registration. However, if a request for registration is not made or is otherwise withdrawn within 6 months after the priority date, then it will be “deemed” to have occurred.17
The six-month window effectively provides the applicant with a statutory delay in the publication of a design, during which time the applicant may prepare for product launch. Such provisions not only reduce the number of deadlines requiring action by the applicant, but also empower the applicant to modulate the timeline of publication. That is, should the applicant wish to move expediently, a request for registration can be made at the time of filing the application – or at any point within 6 months thereafter. Importantly, the request for registration of one design within an application consisting of multiple designs does not influence the registration status of any other design in the same application. Additionally, should the designer decide not to move forward with a design, its application can be withdrawn within the 6-month window and remain confidential.
Schedule 4 – Relief from infringement before registration
Schedule 4 rectifies an anomaly in the applicability of the ‘innocent infringer’ defense by ensuring that the defense extends to the period between the filing date of a design application and the date of registration of the design. Since a design only becomes publicly available after it is registered, which under the provision of Schedule 3 may be up to 9 months after the priority date, such rectification of the ‘innocent infringer’ defense is needed to reduce the risk to competitors for using a design that they had no means of knowing would be registered.18
Importantly, for the innocent infringer defense to be available, the user must be able to demonstrate that they did not know and could not reasonably have known of the application disclosing the infringed design.19 Furthermore, under the amended Design Act, the court has the discretion to refuse to award damages, reduce damages that would otherwise be awarded, or refuse to make an order for an account of profits.20 Moreover, unlike the exemption from infringement provided in Schedule 2, once the user has been put on notice, any protection from infringement afforded under the innocent infringer defense ceases.21
Schedule 5 – Right of exclusive licensee to bring infringement proceedings
Schedule 5 provides exclusive licensees with the legal authority to initiate infringement proceedings, a right which previously had been only to the owner of the registered mark. Not only did the former provisions deviate from other domestic IP legislation (e.g., trade marks, patents, and plant breeders rights), they denied the exclusive licensee the ability to fully benefit from rights which they had paid to use at the exclusion of all others, including the owner of the design.22 Thus, under the current Designs Act, the exclusive licensee is given full legal authority of the licensed design.23
Schedule 6 – Formal requirements
Schedule 6 streamlines the process for updating formal requirements for a design application by providing the Registrar of Designs with the power to specify formal requirements for design applications.24 Formal requirements for a design application include what information must be included in an application or how drawings should be presented. Prior to the Designs Amendment Act, changes to such formalities required amending the Regulations, limiting the ability of the designs system to keep pace with technological advances (e.g., formally allowing electronic copies of documents versus hard copies exclusively). Hence, the purpose of such changes is to ensure that the nature of acceptable formal requirements keeps pace with rapidly evolving technologies and that the requirements are readily accessible to applicants.25
Schedule 7 – Other amendments
Schedule 7 makes minor improvement in the Designs Act by resolving inconsistencies therein, as well as simplifying and clarifying aspects of the design system for users.26 In particular, Schedule 7 clarifies that the standard for an ‘informed user’ is a person who is familiar with the product in question (or one of similar nature) without limitation as to how the familiarity was acquired.27 Since the notional ‘informed user’ is used to gauge newness and distinctiveness of a design application, in addition to the similarity of registered design to that of an alleged infringer, clarity with respect to the ‘informed user’ is pertinent throughout the life cycle of a design.
Schedule 7 further resolves that all relevant acts of fraud, false suggestion, or misrepresentation are grounds for revocation of a registered design,28 regardless of whether an application for the court order to revoke the registration is made before or after 11 September 2021 (commencement of Schedule 7).
Finally, Schedule 7 provides clarity with respect to the status of a registered design during the renewal grace period (i.e., within 6 months of the 5-year filing date). While a registered design is in the renewal grace period, its status as shown on the Register will be ‘registered – in grace period’ to provide third parties certainty with respect to if/when the design could be infringed. Additionally, where a design is not renewed, the effective date upon which the registration is deemed ceased is clarified as being the 5-year filing anniversary, not 6 months thereafter.29
- Designs Amendment (Advisory Council on Intellectual Property Response) Act 2021 (Cth) received Royal Assent on 10 September 2021 (‘Designs Amendment Act’).
- Explanatory Memorandum Designs Amendment (Advisory Council on Intellectual Property Response) Bill 2020 (Cth) 1 (‘Explanatory Memorandum’), 8 .
- Ibid 8 .
- Explanatory Memorandum (n 2).
- Designs Act 2003 (Cth).
- Explanatory Memorandum (n 2) 1; Advisory Council on Intellectual Property, Review of Designs Systems (Final Report, March 2015) s 2.4.3 (‘ACIP 2015 Report’) 6.
- Designs Amendment Act 2021 (n 1) sch 1, provides a definition for ‘relevant entity’ within amended s 17(1D) of the Designs Act 2003 that includes registered owner(s) of a design, their predecessors in title, and the designer(s) who created the design.
- Ibid sch 1, does not limit the jurisdiction of design publication or use under amended s 17(1).
- Ibid sch 1, item 1 extends grace period provisions to ‘publication or use of a design (which may or may not be the subject design)’ (emphasis added) under amended s 17(1)(a)–(b). Explanatory Memorandum (n 2) 8 .
- Ibid sch 1, includes s 17(1C) under which ‘it must be presumed that the other person or body derived or obtained the design from the relevant entity, unless it is established that the other person or body created the other design without reference to, or knowledge of, the first design.’
- Ibid sch 1, item 1 provides that under amended s 17(1B), grace period protection does not apply to publication of a design by the Registrar or by an equivalent person or body in a foreign country.
- Explanatory Memorandum (n 2) 10 . IP Australia, ‘Australian Intellectual Property Report 2020’, Designs (Web Page, 22 May 2020) chs 2, 4 <ipaustralia.gov.au/ip-report-2020>. The IP Report 2020 indicates that in 2019, the patents office examined and granted 17,010 applications. By comparison, the designs office registered 6,977 designs rights, a significantly lower quantity.
- IP Australia (n 12) s 1.4.
- Designs Amendment Act 2021 (n 1) sch 2.
- Explanatory Memorandum (n 2) 2 .
- Designs Act (n 5) s 71A(c)(i).
- Designs Act (n 5) s 35.
- Explanatory Memorandum (n 2) 29 .
- Designs Act (n 5) s 75(1A).
- Ibid s 75(1A).
- Explanatory Memorandum (n 2) 30 .
- Ibid (n 2) p 5.
- Designs Act 2003 (n 5) s 70.
- Ibid ss 39(2)(a), 40(2)(c), 149A.
- Explanatory Memorandum (n 2) 37 –.
- Ibid p 6.
- Designs Act 2003 (n 5) s 19(4). Multistep Pty Ltd v Source & Sell Pty Ltd (2013) 309 ALR 83 .
- Designs Act 2003 (n 5) s 93(3)(d).
- Ibid s 47(4).
This article was written by Megan Cole.
9 January 2023