Doug Calhoun
IP Mentor
23 Versailles Street
Karori
Wellington 6012
Tel +64 4 476-4064
Cell +64 21 037-0704
Email [email protected]
Single trans-Tasman Regulatory
Framework for Patent Attorneys
Introduction
I am a retired patent attorney, but I keep an active interest in the profession that I was
proud to be a part of for 32 years. Reform of the regulation of the patent attorney
profession was a hardy perennial throughout the 1980s and 1990s when I served on the
council of the New Zealand Institute of Patent Attorneys. Perhaps the low point in the
debate came in December 1987, when the recently re-elected Labour government
released a post election agenda of deregulation. I was returning to my office and heard
Sir Geoffrey Palmer on my car radio announcing a long shopping list of professions and
trades that would be deregulated. “Patent attorneys and plumbers” were the two I
remember best. It was after the Christmas break that year that the Lange/Douglas
reforms slowed down for a cup of tea. Since then a minimalist approach has been
abandoned in favour of a Patent Attorneys Bill that now runs to over fifty pages, which
was reported back to Parliament in March 2010. That Bill in turn is now on the reserves
bench while the present proposal is being considered.
The most striking feature of the present proposal is the absence of any explanation how it
fits into the overall economic objectives of the government. The asserted benefits of
economies of scale and saving time, money and effort for the profession are only
applicable to the “business” of registering patent attorneys. They are of little significance
to economy as a whole. What is missing is an analysis of the goals of a single economic
market and where patent law fits in with those goals. The major inefficiencies in
providing patent attorney services to a trans-Tasman market arise from having different
patent laws in each country. They do not lie in the way in which patent attorneys are
regulated.
The joint regulation proposal should be taken no further unless it can provide satisfactory
policy based answers to the following questions:
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i. In the initial Patents Bill briefing paper prepared by MED for the Commerce Select
Committee1 MED advised, “In developing patent legislation for New Zealand, the
aim must be to maximise the benefits of the patent system to New Zealand.” Is the
aim of this proposal also to maximise the benefits to New Zealand? If it is, how
would this proposal do so?
ii. The Trans-Tasman Mutual Recognition Act 1997 has been in force since 1 May
1998. From that date any New Zealand registered patent attorney has been entitled
to be registered to practice as a patent attorney in Australia. Since then there has
been one trans-Tasman patent attorney partnership formed and later dissolved. The
present proposal would change the way in which attorneys are registered, but would
make no difference to the ways in which trans-Tasman patent attorney services can
be provided. Has MED interviewed any of the former partners in the dissolved
partnership, or their clients to determine if the present proposal would have made
any difference?
iii. Regulation of trade mark attorneys in Australia began in 1998.2 The discussion
paper states that trade mark attorneys are neither recognised nor regulated as an
occupation group in New Zealand and this will not change. That assertion does not
recognise that many registered New Zealand patent attorneys do advise as specialist
trade mark attorneys in New Zealand. But the policy is that there will be no transTasman trade mark attorneys. How does this anomaly fit in with the aim of creating
a seamless trans-Tasman business environment?
iv. Persons who wish to practice the profession of patent attorney in New Zealand
alone would (under the proposal) be denied the freedom of choice to do so. Why are
New Zealand attorneys being denied this possibility? Has MED found any other
jurisdiction where patent attorneys are unable to be registered as patent attorneys in
their own country?
v. The proposals for implementing the SEM are piecemeal, inconsistent and are not
aligned with their stated goals. Why are patents attorneys to be jointly regulated,
but the patent laws to remain different; while trade mark laws are to be made the
same, but trade mark attorneys not jointly regulated? How does the joint regulation
policy align with the MED aim to improve the drivers for success and productivity
improvement in New Zealand firms?
Benefits to New Zealand
1. On page 13 of the discussion paper it is stated that the aim of a Single Economic
Market is “to accelerate and deepen economic harmonisation and alignment in
1
PAT/MED/1, Patents Bill – Initial Briefing for Select Committee, March 2009, paragraph 20.
See (Australian) Intellectual Property Laws Amendment Act 1998: and Trade Marks
Amendment Regulations 1998 (No. 4) 1998 No. 346, Explanatory statement at:
http://www.comlaw.gov.au/Details/F1998B00363/Explanatory%20Statement/Text
2
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order to stimulate business and create jobs resulting in a net trans-Tasman
benefit.” The net benefit was said to be, “economies of scale, reduced transaction
costs and enhanced consistency and quality of the trans-Tasman profession and
increased confidence by users.” The economies of scale and reduced transaction
costs will only be achieved in the business of registering patent attorneys. But
improved efficiencies in the business of regulation of patent attorneys are hardly
of any consequence to the overall economy of either country.
2. It is asserted that the change would result in enhanced consistency and quality of a
trans-Tasman profession. But the differences in patent laws between each country
are to remain. There do not appear to be any tertiary education institutes in New
Zealand willing to apply to be accredited to train New Zealand attorneys because
of the low numbers of potential candidates. Accredited tertiary providers in
Australia are unlikely to be up to speed with the nuances of the existing New
Zealand law, let alone the unknown interpretations of the new Patents Act for
teaching New Zealand candidates. The service time for on the job training before
registration would be decreased from three to two years. If tutoring and qualifying
examinations are to be provided in New Zealand by practising patent attorneys (as
they are now) the quality should remain the same. But candidates would be
allowed to be fully qualified with a year less on the job training than they are
now. It is difficult to reconcile all these factors with the assertion that the changes
would result in the promised “enhanced consistency and quality” in the delivery
of patent law services in New Zealand.
3. There is a lack of alignment between policies behind the Patents Bill and the
regulation of patent attorneys. The joint regulation proposal and the pending SEM
proposal to combine efforts of patent examiners in both countries are both
constrained by the limitation that there are different patent laws in each country.
The intention of an SEM is to achieve a net trans-Tasman economic benefit. But
the inherent inefficiencies lie in the need to file separate applications in each
country, go through different examination and post examination processes in each
country, pay different fees to maintain patents in each country and to go through
different court systems to enforce patents in each country. An innovator who
wishes to exploit patent exclusivity in a trans-Tasman business is not going to be
very concerned with how patent attorneys are regulated. How patents are
examined is only a concern when the process has to be done twice - and when the
outcomes are different. He or she will just want to know what exclusivity he or
she can obtain and does he or she have freedom to operate in both markets.
Changes in the regulation of patent attorneys or sharing of examination services
would do nothing to address the fundamental inefficiencies inherent in having
separate patent laws.
4. In summary, the inefficiencies inherent in the having different in patent laws
outweigh any benefits to be achieved in the business of regulating patent attorneys
by this proposal. The present Patents Bill aims to achieve the maximum benefit
for New Zealand. But the joint regulation proposal aims to achieve the best net
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trans-Tasman benefit. A net trans-Tasman benefit does not necessarily mean
maximum New Zealand benefit. Before this policy is implemented the
government should be satisfied that it is in the best interests of New Zealand to do
so.
Trans-Tasman Mutual Recognition
5. In the MED fact sheet on the joint regulation proposal it is stated that a benefit for
patent attorneys not currently registered in both countries would be increased
business opportunities. An implication from that statement is that an inability to
be registered in the other country has been an impediment to trans-Tasman
business opportunities.
6. But it has been possible to be registered in both countries under the Trans-Tasman
Mutual Recognition Act for 13 years. In 1998, a trans-Tasman partnership of
patent attorneys was set up under the name, Baldwin Shelston Waters. That
partnership was dissolved in 2004.3 Since then the former Australian and New
Zealand joint partners have practiced in separate partnerships in their home
countries. As far as I know, there have not been any other formal trans-Tasman
partnership arrangements even though this has been possible.
7. Before adopting a policy that patent attorneys must be jointly registered, or not at
all, MED should have consulted with existing patent attorney firms to determine
why 43% of attorneys registered here have chosen not to be registered in
Australia. It should have asked former partners and clients of the only transTasman partnership if the availability of joint registration would have made any
difference to the continuation of the dissolved partnership. In the existing
business models for the delivery of trans-Tasman patent attorney services all
firms are located in their home country. The Policy paper does not suggest how
joint regulation might enhance the existing business models.
8. The joint regulation policy has been developed with the inward focus of how
IPONZ and IP Australia can most efficiently run the business of regulation of
patent attorneys in New Zealand and Australia. To maximise the benefits to New
Zealand the focus should be outward - on the delivery of patent attorney services
in New Zealand to best promote the use of patents in advancing innovation.
Trade Mark Attorneys
9. At present there are a number of New Zealand registered patent attorneys who do
not have a tertiary technical qualification and who are specialists in trade mark
law. In practice, they are trade mark attorneys. Under the proposal, current
practising New Zealand trade mark attorneys would continue to be regulated as
trans-Tasman patent attorneys under the grandparenting provisions. But under the
3
See, http://www.shelstonip.com/about.asp
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proposal there would not be any specialist trade mark attorney qualification in
New Zealand.4 And because the Australian trade mark attorney qualification has
no equivalent in New Zealand, a New Zealand based practicing trade mark
attorney cannot be registered as a trade mark attorney in Australia under the
mutual recognition provisions.
10. From the point of view of a New Zealand resident who does not have a qualifying
technical degree or a law degree, a career path as a qualified practicing trade mark
attorney that is now available would be been cut off. For a registered Australian
trade mark attorney, the registration in New Zealand under mutual recognition is
also denied. And indeed, a registered Australian trade mark attorney who holds
himself or herself out as such in New Zealand might be in breach of the Lawyers
and Conveyancers Act5.
11. From the point of view of a user of intellectual property advice services the policy
would be a source of confusion. Patent advice would come from jointly
registered patent attorneys qualified to advise on the patent laws of both countries.
In contrast, trade mark advice in Australia would come from trade mark attorneys,
but in New Zealand it would come from grandparented trade mark specialist
patent attorneys, lawyers who might not be trade mark specialists, or trade mark
specialists who are not regulated. Such a user would be left wondering what a
single economic market means when it come to advice on trade marks.
12. In the fact sheet it is stated that the aim of an SEM is to create a seamless transTasman business environment. But a consequence of this proposal is that joint
regulation of patent attorneys would make no difference to the existing transTasman delivery of patent services; and the non-regulation of trade mark
attorneys in New Zealand would further reduce the existing limited trans-Tasman
delivery of trade mark attorney services.
13. The discussion paper gives no reason why there is no proposal to have a transTasman market in the provision of trade mark attorney services. But in another
proposal under the SEM initiatives there is an intention to have “one transTasman trade mark regime” within five years.6 If the intention is never to
have regulation of trade mark attorneys in New Zealand, then it is difficult to see
how that could be a one trade mark regime. If the intention is that joint regulation
of trade mark attorneys is being postponed until it becomes part of the trade mark
regime change, then that should be made clear.
4
Single Trans-Tasman Regulatory Framework for Patent Attorneys, Discussion Paper, March
2001, Ministry of Economic Development, Paragraph 6), page 11.
5
See Lawyers and Conveyancers Act 2006, section 22 (1).
6
See http://www.treasury.gov.au/ttoig/content/outcomes_proposals.asp
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Freedom of Choice
14. Under the proposal, New Zealand based attorneys would have to be jointly
registered or not registered at all. New Zealand patent attorneys would not in
future have any choice of where they are registered. Canadian patent attorneys
can choose to be registered as patent agents in the USPTO. British patent
attorneys can choose to be registered as European patent attorneys in the
European Patent Office. But Canadian and British patent attorneys can also
choose only to be registered in their home country.
15. MED have not proposed that any other occupation is to be jointly regulated in an
SEM in such a way that a worker is denied the choice of where to carry out his or
her occupation. If it is of maximum benefit to New Zealand to have its own
distinct patent law, it should also be of maximum benefit to New Zealand to have
its own patent attorneys who are specialists in New Zealand law. It was my
impression in the eight years I practiced under a mutual recognition regime that a
significant competitive advantage that New Zealand patent attorneys have in the
New Zealand market is their specialist knowledge of New Zealand patent law.
The proposal would at least dilute if not remove that competitive advantage.
Policy Confusion and Misalignment
16. In a recently released report reviewing the quality and value of government policy
advice,7 the authors noted shortcomings in the alignment of policy advice with
government priorities and the connections between agency work programmes and
the wider government agenda.8 The Scott Report also noted that while
government agencies remain primary sources for policy advice (in keeping with
the non-political principle of the public services) public servants need to
accommodate “the contribution that can be made to the analysis and advice by the
wider policy community”.9
17. When the benchmarks set in the Scott Report are applied to the present policy
proposal and compared with the MED’s priorities over the next three years10 there
are apparent misalignments. MED’s top priority is “Enterprising and innovative
businesses – improving the drivers for success and productivity improvement in
7
Review of Expenditure on Policy Advice: Improving the Quality and Value of Policy Advice,
Scott, Duigan and Faulkner, Released 28 April 2011, at the link:
http://www.treasury.govt.nz/statesector/policyexpenditurereview (the Scott Report)
8
Ibid., page iii.
9
Ibid., page 2.
10
As set out in Statement of Intent 2010 – 2013, Ministry of Economic Development, available
at: http://www.med.govt.nz/templates/StandardSummary____11454.aspx
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firms.” 11 MED is to lead cross-agency work “to develop and implement a
comprehensive and coherent approach to innovation and business support”12
18. The proposal for reform in the regulation of patent attorneys does not align with
the aim of improving drivers for productivity enhancement in the New Zealand
economy. All that it might achieve is better productivity in the regulation of
patent attorneys.
19. In 2009 MED commissioned a study into the role of intellectual property in
driving innovation. In the tender document MED stated:
“The influential role of the intellectual property system within the New
Zealand economy gives rise to the importance of this review. The drive
for greater productivity in the New Zealand economy would benefit from
a closer examination of the property rights system and ensuring there is
good alignment of policies and practices and the productivity goal. There
is sufficient information to suggest there is a need for improvement.”
“The MED view of the potential problems or barriers in the intellectual
property system is piecemeal and lacks a strategic or overarching
perspective. A broad consideration of the intellectual property system is
required. One that takes account of all forms of intellectual property
rights – formal and informal, proprietary and open source – and how these
work in combination.”
”The review will improve our understanding about the perceptions,
awareness and use of the intellectual property system by New Zealand
firms. The insights gained for the review will guide the Ministry of
Economic Development’s own assessment of the strengths weaknesses
and opportunities for the intellectual property system to drive growth and
productivity.”13
20. The commissioning of the report was a good start on aligning intellectual policy
with an improving productivity goal. But there was a problem with the timing.
The Patents Act 1953 has been under review on a periodic basis since 1983. The
Patents Bill (that is finally to replace the 1953 legislation) had been introduced
into Parliament some months before the RFP was published. The resulting
Uniservices Report14 was not published until after the Patents Bill had been
through the select committee process and returned to the house. The first
11
Ibid., page 7.
Ibid., page 8.
13
Review of the Intellectual Property System in Driving Productivity: Request for Proposals,
Ministry of Economic Development, (Tender closed 17 April 2009), Advertised on the
Government Electronic Tenders service, www.gets.govt.nz, pages 17 and 18. (the RFP)
14
Review of the New Zealand Intellectual Property System, Auckland Uniservices Ltd for MED,
available at: http://www.med.govt.nz/templates/StandardSummary____41961.aspx
12
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comprehensive revision of patent law in over fifty years was “completed” at a
time when, by its own admission, the MED understanding of the IP system was
piecemeal and lacked a strategic or overarching perspective.
21. The authors of the Uniservices Report concluded from the survey they conducted
that there is a general awareness of IP in New Zealand that is not matched by a
similar level of knowledge about IP. The authors went on to recommend:
“Government agencies have a role in raising awareness and understanding
of IP amongst the business community and the wider community at large.
In particular, the relationship between awareness, cost and the value of IP
needs to be better articulated and promoted. An efficient programme
would include education through the formal education providers at tertiary
level and, possibly at secondary level. This would be supplemented by the
existing programmes of advice and information provided by MED and
IPONZ and other government bodies. A variation of the advice provided
by government agencies would be to fund IP advisors to provide initial
consultation and advice. A third level role for government agencies would
be to provide/fund provision of advice and information by industry bodies,
e.g. IPENZ. This third level of advice would be specifically tailored to the
needs of specific industries and professions, such as engineers. As noted
elsewhere, any initiatives to raise awareness and understanding of IP must
include the wider IP profession including patent attorneys, IP lawyers,
accountants and venture capital providers.”15
22. The Uniservices Report has remained dormant on the MED website. It is the
usual practice when the government releases a commissioned report to give some
indication of what it intends to do with the advice it has received. (The Scott
Report is an example of where the government response was announced when the
report was released.) But when the Uniservices Report appeared on the MED
website, the accompanying explanation gave no indication whether or not MED
agreed with the recommendations or if they would ever be implemented. A year
has now passed and there is no suggestion in any of the MED policy statements
since then that any action on the recommendations will ever see the light of day.
There is no resulting programme that might be aligned with the MED’s aim of
leading cross-agency work to improve the drivers for success and productivity
improvement in firms.
23. The joint regulation proposal has an inward focus on the efficiencies of regulating
patent attorneys. The Uniservices policy suggestions have an outward focus on
enhancing productivity through better use of intellectual property. The
Uniservices suggestions are aligned with the policy aim of retaining a separate
patent law for New Zealand – maximising benefits to New Zealand.
15
Ibid., page 8.
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24. The Uniservices Report suggested several ways in which to upskill New
Zealanders to take better advantage of their intellectual property. Patent attorneys
have a role in each. The money being spent on advancing the joint regulation
policy any further would be much better spent on advancing some or all of the
suggestions in the Uniservices Report. If this is done the cost of the Uniservices
Report could prove to be a worthwhile initial investment. As it stands the
Uniservices Report is just a cost.