Intellectual property rights in the Commonwealth Government – what you need to know

The Australian Government creates, owns, and uses a substantial amount of intellectual property (IP) through its various activities including science, health, education, defence, public infrastructure, information technology, and the arts. It is necessary for government agencies to be aware of how IP is created and by whom, whether it should be formally registered as a right of the Government, and ensures that the management of the IP is efficient and lawful. Simply, good governance requires that the IP government creates, is protected and managed in accordance with a detailed IP management plan devised within each government entity.

What is intellectual property?

IP is the legal rights associated with the intellectual activity in the industrial, scientific, literary and artistic fields. IP protects the expressions of the mind. It refers to the intangible assets that are created as a result of the intellectual efforts of individuals. Intellectual property rights come in many different forms including:

• trade marks – protects brands including names, letters, signatures, logos, devices, colours, shapes and signs
• copyright – protects creative works including literary works, computer programs, databases, plays, films, scripts, website content, performances, architectural plans, schematics, musical works, sound records, publications, novels, choreography, and photos
• patents – protects new and novel inventions
• designs – protects the overall visual appearance of a product.

Other forms of IP include trade secrets, confidential information, domain names, circuit layouts, plant breeder’s rights, geographical indications and privacy.

To fully optimise the benefits of IP assets, it is critical for government agencies to ensure that its IP is properly protected in order to commercialise the IP asset, defend against infringers, assign, licence and sell the IP. The registration of IP rights (if possible) is critical to ensure the proper ownership and control over the IP asset and avoid infringement risks. A detailed IP management plan also ensures that the use of any IP is properly controlled.

Further, it is also necessary to have appropriate mechanisms in place to ensure that any use of third-party IP does not infringe the rights afforded to the owner or licensee of that IP.

Recent IP disputes

Australia has seen its fair share of IP disputes. There have been disputes involving some big names and celebrities, including Katy Perry, Kylie Minogue v Kylie Jenner, Adidas three-stripe trade mark, Burger King v Hungry Jacks, UGG boots, and our now infamous Apple v Samsung patent disputes which took over seven years to settle in 2018.

Trade marks and patents are becoming very valuable business tools and create significant commercial value for a business or organisation using these forms of IP. More recently, the High Court judgment of Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2022] HCA 29 looked at whether a claimed invention that utilises computer software or hardware will be patentable under the Australian Patents Act. The Australian High Court rarely decides IP disputes. The judgement was split 3:3. Patentees of inventions involving the use of computer software or hardware should now review their patent rights, which could now be vulnerable to a registrability attack.

IP principles for government agencies

Some years ago, the Commonwealth Government released the Intellectual Property Principles for Australian Government Entities (Statement of IP Principles) to assist government agencies in dealing with and managing their IP.

The Statement of IP Principles is made up of 15 principles which address the following issues:

• effective, efficient and ethical management of IP
• identification and recording of IP
• protection of IP
• ownership of IP, including licencing of IP
• sharing and disseminating of IP
• commercialisation of IP.

For a more in-depth discussion about these IP Principles, watch our on-demand webinar on Managing IP in the Australian Government here.

IP framework

In accordance with the Statement of IP Principles, Commonwealth entities are required to establish an IP framework which should:

• provide systems to guide decision-making during the IP ‘lifecycle’ and allow for the review of such decisions
• align IP with the core functions and purpose of an entity
• encourage decision-makers to understand the issues, options, risks, costs and benefits associated with IP
• encourage better IP practice to achieve operational outcomes and avoid infringement of third parties
• be integrated with existing management and operations of the entity
• promote a culture of IP awareness.

An IP framework will usually consist of an IP policy which sets out the purpose of managing IP, an implementation plan and mechanisms to review and evaluate the IP policy.

IP policy

An IP policy is a formal statement produced by a Commonwealth entity that outlines its approach to managing its IP such that it aligns with the Statement of IP Principles.

To create an IP policy, an entity must first research and understand the IP principles and the general requirements for managing IP throughout its lifecycle. Entities must draft a policy to align with their core functions and identify all the types of IP generated, acquired, used or being dealt with while executing its core function. The draft IP policy should address the following issues:

• types of IP – identify the types of IP generated by the entity and its value to the entity
• objective – state how the entity seeks to properly use and manage IP in line with its core function
• scope – identify who the policy will apply to within the relevant entity
• IP management – set out the entity’s policy on the creation, acquisition, protection, ongoing management and disposal of its IP
• IP commercialisation – outline the process for valuing its IP and pursuing commercial opportunities for the IP
• IP ownership – describe the entity’s policy on IP created by staff, consultants, contractors, and anyone else who may work for or with the entity and also include provisions for recognising employee contributions to the entity’s IP
• reporting and review – include provisions regarding the reporting of IP management decisions to stakeholders as well as a process to regularly review the IP framework.

IP implementation plan

The IP policy should be supported with an appropriate IP implementation plan which sets out how the IP policy will be put into effect on a practical and operational level. Government entities should consider the following when preparing an IP implementation plan:

• the assets and resources required to implement the IP policy
• who are the stakeholders for implementing the various elements of the IP policy and who has the authority to make decisions regarding IP
• the existing systems which may impact the implementation of the IP Policy such as asset management, risk management, contact management, finance and employee management
• the current IP awareness within the entity and if any training is required.

The IP policy and its implementation, which make up the IP Framework, should be subject to regular periodic reviews to ensure it aligns with the objectives of the entity, improves on any deficiencies and continually grows its effectiveness in managing its IP.

Identification, recording and management of IP

As noted above, an IP policy implemented by an entity should include provisions which require an entity to maintain appropriate systems for the identification and recording of IP to enable entities to:

• enable the proper use of its IP
• fulfil financial, record keeping and accountability obligations
• ensure efficient and effective use of resources
• facilitate access to IP with the knowledge of who has the rights to use or distribute the IP
• avoid duplication of recording of IP
• lower risk of infringement.

IP may be created from the majority of activities performed by an entity. This may include the development of patentable inventions, trade marks and copyright which subsists in materials such as software, documents, emails and letters. Therefore, it is impractical for an entity to identify and record all IP created and should have a cost-efficient mechanism to identify and manage only the IP which warrants management. In general, the IP that warrants management is IP that are:

• important to the operation of the entity;
• contributes significantly to achieving the entities’ purpose;
• an outcome of the investment of substantive entity resources; or
• may be included in commercialisation activity.

Failure of an entity to properly record and manage the IP it creates or uses may result in the following:

• loss of IP rights as a result of missing critical deadlines for registrable forms of IP (trade marks patents, designs)
• loss of novelty for patentable inventions or designs as a result of inadvertent disclosure
• loss of opportunity to commercially leverage IP
• unintended infringement of third party IP
• inability to detect potential infringement of IP and take timely action to address infringement.

Key takeaways for government agencies

• IP created and used by agencies are valuable assets and entities must ensure that its IP is properly used and managed.
• The Australian Government’s Statement of IP Principles provides a broad framework for the management of IP for Commonwealth entities.
• Commonwealth entities should develop and implement their own IP frameworks that align with their core objectives and is compliant with the Statement of IP Principles.

Holding Redlich can assist government agencies with regard to its compliance with the Statement of IP Principles by providing advice on the drafting of an IP policy, assisting with the protection of its IP rights (including any filings for trade marks, patents and designs), preparing and reviewing IP agreements, management of IP portfolios and enforcement IP rights where necessary. Click here to see how we can help.

If you have any questions, please contact us below or send us your enquiry here.

Disclaimer
The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

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