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Australian Productivity Commission Slams Protectionist Copyright and Patent Laws

DEEPLINKS BLOG
May 9, 2016

Last month we wrote about a discredited industry report that spread misinformation about the supposed costs of Australia adopting fair use into its copyright law. That document, commissioned by media and entertainment giants, had been written in anticipation of a recommendation for the adoption of fair use by the Australian Productivity Commission, a government agency tasked with improving Australia's capacity for production and innovation.

The Productivity Commission's 600 page draft report was in fact released ten days later, and apart from recommending the adoption of a fair use right, it also makes a number of other recommendations for the reform of copyright and patent laws. Amongst its key recommendations are:

  • Making it harder for obvious inventions to be patented, by raising the standard for the inventor to demonstrate an “inventive step” to the slightly higher level that already exists in Europe. Since even this would still allow too many low-quality patents through, the Commission recommends pursuing multilateral discussions about raising the threshold further.
  • Restricting the availability of patents for software and business method inventions, which are an impediment to further innovation. As regards software, the Commission notes that software development cycles of around 5 years are far shorter than the 20 year term of protection granted by patents, and that other incentives for software development (among them copyright) also exist.
  • Copyright should be supplemented with a fair use right, that would allow works to be freely used in ways that are socially beneficial and cause minimal harm to the copyright owner, using a U.S.-style four factor balancing test. Anticipating the rightsholders' objection that this would create legal uncertainty, the Commission suggests that a range of illustrative uses could be included in the legislation, and notes that U.S. case law will provide further guidance to Australian courts.
  • The law should clarify that users are entitled to bypass geoblocks that lock lawfully available online content away from Australian users, or require them to pay higher prices to local content distributors. As the Commission notes, this practice harms Australian users and only encourages them to engage in unlawful downloading of content.

A recurring theme throughout the report is that many of the costs and restrictions that Australian users face have been imposed on them through bilateral and plurilateral agreements such as Australia's Free Trade Agreement with the United States, and most recently the Trans-Pacific Partnership (TPP). As the report notes, Australia is a large net importer of goods and services protected by copyright and patents, which means that these heightened protections are not in the country's interest. The Commission recommends a change of course by Australia's trade negotiators, recommending that they stand up for their citizens' own interests, rather than capitulating to foreign demands.

Predictably, the response from the media and entertainment industry has been swift and hyperbolic, including the dire warning that fair use “would be a wrecking ball to Australian writers, creators, publishers and the local creative industries”, and the odd and evidence-free assertion that fair use “has led to the erosion of rights of authors and artists in North America”. The discredited industry report that placed a $1bn price tag on fair use has also been falsely repeated, along with claims that the Commission proposes to reduce Australia's copyright term to 15-25 years (in fact the Commission found that, whilst a good idea, Australia's current international obligations make this impossible).

The Commission should take this fearmongering and misrepresentation in its stride, recognizing it as the self-serving rhetoric of a coddled industry sector that doesn't represent Australia's broader public interest. The Commission is calling for further comments on its draft report by June 3, to enable it to submit its final report to the government on August 18.

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