Amendments proposed to Patents Act

Last year, the Government recommended substantial changes to the Patents Act 1953 (the Act) to cope with advances in technology and sciences.

Three papers were released as part of Stage 3 of the Government's review of the Act. The first of the papers considered:

1. the sufficiency of the definition of the term “invention” in the Act;
   
   
2. whether it is appropriate to retain certain exclusions to patentability in New Zealand (e.g. methods of medical treatment and processes for the generation of human beings);
   
   
3. whether business methods and computer software should be excluded from patentability; and
   
   
4. whether the test for determining whether or not a patent should be granted in New Zealand should be revised.

The second paper dealt with the issues surrounding the patenting of plants and animals, and the patenting of genes.

The third paper recommended the establishment of a Maori Consultative Committee that will be consulted by the Commissioner of Patents where a patent application may impact on Maori rights or interests.

The definition of “invention” in the Act

Section 2 of the Act currently defines an “invention” as:

“any manner of manufacture the subject of letters patent and grant of privilege within section 6 of the Statute of Monopolies and any new method or process of testing applicable to the improvement or control of manufacture; and includes an alleged invention.”

The limits of the current definition have recently been tested by the development of new technologies (e.g. developments in biotechnology and computer software). As a result, the sufficiency of the current definition has been questioned and it has been recommended that in light of such developments it is appropriate to amend the definition by adding to it three further internationally recognised criteria, namely that an invention be novel, involve an inventive step and be useful.

Such an amendment will bring the definition into line with that used in Australia and this harmonisation will allow case law from Australian courts on the interpretation of this definition to be relied on in New Zealand.

Retention of exclusions from patentability

Currently, under section 17 of the Act, the Commissioner of Patents will refuse to grant patents that might include humans or processes for their generation within their scope. There is, however, no specific exclusion in this regard in the Act. It is therefore proposed to put this issue beyond doubt by amending the Act by adding a specific exclusion in relation to the patenting of human beings or processes for their generation.

At present, methods of medical treatment of humans are treated by the Commissioner of Patents as not being patentable in New Zealand. However, the position is unclear and because of this it is proposed to amend the Act to include a specific exclusion from patentability for diagnostic, therapeutic and surgical methods for the treatment of humans.

Business methods and computer software

There being no strong arguments against the patentability of business methods and computer software and patentability of these being broadly consistent with the approach taken in other jurisdictions, the Government has concluded that business methods and computer software should continue to be patentable in New Zealand, so long as they fall within the definition of “invention”.

Changes to the test for granting a patent

Under the current Act, the Commissioner of Patents can only refuse to grant a patent application if it is “practically certain” that if a patent was granted it would be invalid. As a consequence of this, many granted patents may be invalid but go unchallenged because of the significant costs associated with invalidity actions. This is thought to be unjust (and to have associated economic costs). Accordingly, it is proposed that the Act be amended so that patents will only be granted if, on the balance of probabilities, the requirements for patentability are met.

How should patent applications for plants and animals be dealt with?

The Government intends to amend the Act to allow patents to be granted for plants and animals subject to a requirement that the Commissioner of Patents refuse patent claims if he or she considers that the commercial exploitation of the claimed invention will be “contrary to morality or ordre public”, or prejudicial to plant life, or human or animal health, or to the environment.

What about plant varieties?

It is also recommended that plant varieties should be specifically excluded from patentability to avoid double protection of plant varieties under the Act and the Plant Variety Rights Act 1978 in breach of New Zealand's obligations under the 1978 UPOV Convention.

The patentability of genes

Under the Act, genes and parts of genes are patentable in New Zealand. However, overseas experience, particularly in the United States and the European Union, has demonstrated that there needs to be a requirement for applicants to show that there is a credible, specific and substantial use for the claimed gene before a patent issues.

If there is not, a patent that claims a gene will be open to the criticism that it covers no more than a discovery. Accordingly, it is proposed that utility, or usefulness, is to be a specific criterion that will need to be satisfied prior to the grant of such patents in New Zealand.

The Maori Consultative Committee (the “MCC”)

This proposal appears to have had its genesis in the Royal Commission on Genetic Modification which considered that an established system of consultation with Maori in relation to patent applications was “overdue”.

The functions of the proposed MCC will be limited to the provision of advice to the Commissioner of Patents as to whether:

1. an invention claimed in a patent application is derived from or appears to be derived from traditional knowledge or indigenous plants and animals; and/or
   
   
2. the commercial exploitation of such an invention is or is likely to be contrary to Maori values.

It is important to note that the final decision regarding the patentability of any invention remains with the Commissioner of Patents. Given the recommended functions of the MCC, it has been suggested that it would be appropriate if its members had expertise in Maori traditional knowledge (particularly in respect of flora and fauna) and Maori protocol and culture. It has also been suggested that members should possess scientific, technological and commercial expertise.

Enquiries and information

For more information on trade mark law, please email or call Garry Williams on 64 9 916 8661.