Experimental Use Exception - Australia And New Zealand.

Patents legislation throughout the world variously provides that one party shall not "exploit" another's patented invention.

The so-called Experimental Use Exception to patent infringement (EUE) is a balance between at once providing strong and exclusive rights to a patentee, while at the same time stimulating innovation, research and development. Naturally, the differing social, political and economic climate of different countries necessitates a unique "line in the sand" as to precisely where "experimentation" ends and "exploitation" begins.

Neither Australia nor New Zealand presently includes statutory EUE provisions within their respective patent laws.

The issue came to prominence in 2003 when an Australian biotechnology company sought to enforce patents in each jurisdiction relating to non-coding ("junk") DNA mapping by attempting to enter into a proprietary licensing agreement with any entity undertaking related genetic research. Many researchers appeared to be using the technology with no commercial outcome in mind and questions were raised as to whether the sought licensing agreements were justified, or indeed within the scope of the patentee's exclusive rights.

Accordingly, Government review of the EUE has followed in both countries. In Australia, the Advisory Council on Intellectual Property (ACIP) recommended that the following EUE be incorporated within the Patents Act 1990 (Cth):

"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".

Such acts performed upon the "subject matter" of the invention are recommended to include: determining how an invention works; determining the scope of the invention; determining the validity of the claims; and seeking an improvement to the invention. We await further progress as to if, when and how the Australian Government opts to enact the ACIP recommendations.

Government review in New Zealand has followed one or two steps behind Australia, with the intention that the ACIP's recommendations are to be adapted as basis for any statutory New Zealand EUE. As New Zealand's new Patents Act continues to be delayed, it is growing increasingly possible that the new Act, any EUE and the mooted extension of term for pharmaceutical patents (itself, arguably necessary were an EUE to be enacted) may be passed at the same time.

In the interim, researchers on both sides of the Tasman should proceed with extreme caution. Shelston IP is well disposed to advise upon proposed research activities in relation to granted or pending patents in each country.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mr Gareth Dixon

Shelston IP

Level 21

60 Margaret Street

Sydney

NSW

2000

AUSTRALIA

Fax: [phone]

E-mail: [e-mail]

URL: www.shelstonip.com

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