Grants Available for Exporters

/ Michael Dow / Articles

The Australian Government offers a financial assistance program for aspiring and current exporters to cover the costs associated with export promotion activities; the Export Market Development Grants (EMDG) scheme.

The scheme has now been expanded to cover up to 50% of eligible export promotion expenses after the first $5,000 provided that the total expenses are at least $15,000. The initial payment ceiling for the grant year 2013–14 for the EMDG scheme is $60,000. Exporters with entitlements above this amount will receive a second payment at the end of June 2015. The 2013–14 grant year was open until 1 December 2014.

Protecting intellectual property rights internationally can be vital to success in overseas markets. Trade marks provide protection for the brand of a business. As many countries now operate on a first-to-file basis, where the first person to file a trade mark application obtains ownership of the mark, it can be desirable to obtain trade mark protection prior to entering an overseas market. Securing trade mark protection in these jurisdictions at an early stage is advisable to prevent competitors or trade mark “squatters” from filing their own applications for an identical or similar trade mark. Patent rights can also provide protection for products and processes, while registered designs provide protection for the physical appearance of a product. Both patents and designs can provide a crucial market advantage, and allow exporters to obtain and hold market share by preventing competitors from copying successful products.

The EMDG scheme is designed to encourage small and medium sized Australian businesses to develop export markets. Accordingly, the business’s total annual income must be $50 million or less during the last financial year. Once a business has received two grants, they may have to provide evidence of export earnings or assess indicators of future export success in order to be eligible to receive third and subsequent grants.

The EMDG scheme allows eligible business to claim a range of activities. These activities include:

  • maintaining one or more overseas representatives on a long term basis in foreign countries;
  • engaging a consultant to undertake market research, or marketing activities;
  • overseas travel expenses;
  • any expenses associated with any communication with a potential buyer or a distributor, representative or consultant;
  • providing free samples for promotional purposes;
  • participation in a trade fair, seminar, in‑store promotion, international forum, private exhibition or similar promotional event;
  • promotional literature;
  • bringing one or more buyers to Australia;
  • costs associated with the registration and insurance of intellectual property rights in foreign countries for intellectual property that was substantially developed in Australia.

Eligible intellectual property includes an intellectual property right that mainly resulted from work done in Australia, a trademark that was owned, assigned or first used in Australia, and know-how that mainly resulted from work done in Australia. Additionally, costs associated with engaging foreign attorneys to obtain trade mark and patent protection fall within the scope of the EMDG scheme. Further, insurance premiums paid for protection against possible infringement actions are also covered.

The EMDG scheme was recently amended to introduce changes in the EMDG Amendment Bill 2014 which:

  1. increase the number of grants able to be received by an applicant from seven to eight;
  2. reduce the minimum expenses threshold required to be incurred by an applicant from $20,000 to $15,000;
  3. reduce the current $5,000 deduction from the applicant’s provisional grant amount to $2,500;
  4. prevent the payment of grants to applicants engaging an EMDG consultant assessed to be a not fit and proper person; and
  5. enable a grant to be paid more quickly where a grant is determined before 1 July following the balance distribution date.

The EMDG scheme covers past expenses, so even if you have been developing export markets for some time and have been unaware of the scheme, you may be entitled to claim expenses for past years. For more information about the EMDG scheme and how to apply, visit http://www.austrade.gov.au/export/export-grants

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A Comparison of the Australian Innovation Patent and the Chinese Utility Model Patent

/ Martin Pannall / Articles

Most users of the patent systems around the world will be familiar with the “standard” patent which can last for up to 20 years and requires that the invention claimed by the patent be new and involve some level of inventiveness. Fewer users however, are aware that there are other types of patents provided for in some countries. These types of patents, often referred to as “utility model patents” can have lower thresholds as to the level of inventiveness required, and are provided to allow protection for innovations that may not meet the higher requirements of the “standard” patent and thus not be otherwise protectable.

These types of patent systems are often also associated with a more simplified registration process which can provide cost savings in some cases, as well as provide a faster means of obtaining enforceable rights.

Australia is one of the countries that provide this second tier patent, referred to as an Innovation Patent. The Innovation Patent has a very low threshold requirement for inventiveness, and can essentially provide strong protection for inventions that may otherwise not meet the higher inventiveness requirements of the Standard Patent.

China is also a country that provides a second-tier patent system, referred to as a Utility Model Patent. The Australian Innovation Patent system and the Chinese Utility Model Patent system can be utilized to benefit patent applicants in protecting inventions that may otherwise not meet the inventive requirements of the Australian Standard Patent or the Chinese equivalent – the Invention Patent or who wish to obtain enforceable rights more quickly than the corresponding Standard or Invention patents.

Although the Australian and Chinese systems can be used together, there are some important differences between the two systems of which users should be aware.

Inventiveness Requirement:

The Australian Innovation Patent generally has a markedly lower level of inventiveness requirement over the Standard Patent. The invention can be protected, provided that the claimed invention is new and that the difference between what is claimed and what is known before (the “prior art”), provides “a substantial contribution to the working of the invention”.1 In fact, in some cases, the difference between the claimed invention of the Innovation Patent and the known prior art can even be obvious, provided that the difference provides the required contribution to the working of the invention.

The wording in the Chinese Patent law defining the levels of inventiveness required for the Utility Model Patent and the Invention Patent differs slightly, and the ability to combine multiple prior art documents to challenge inventive step is more restricted for Utility Model Patents than for Invention Patents. In practice however, the inventiveness requirements of the Chinese Utility Model Patent are closer to those of the Invention Patent than the inventiveness requirements for an Australian Innovation Patent are to those of the Standard Patent.

In particular, according to the guidelines for examination, at most two pieces of prior art documents can be used to challenge inventive step of a Utility Model Patent, while there is no restriction with respect to how many prior art documents can be used to challenge an Invention Patent. In practice, there is negligible difference in the inventiveness requirements of the two Chinese patent types. The inventiveness requirements of a utility model are that the utility model has substantive features and represents progress. The inventiveness requirements of an Invention Patent are that the invention has prominent substantive features and represents notable progress.2 When challenging inventiveness of a Utility Model, only prior art documents in the same field as that of the Utility Model Patent at issue can be considered. However, as for an Invention Patent, prior art documents in the same or similar field to that of the Invention Patent can be considered.

Examination:

When an Australian Innovation Patent application is filed, it only undergoes a formalities examination and then proceeds to grant usually within 4 to 8 weeks. The granted Innovation Patent may then simply be kept in its granted state for the remainder of its 8 year term. However, if the Innovation Patent is to be enforced, then substantive examination (Certification) must be requested. The Innovation Patent is then examined for the normal patentability requirements (with the lower inventive step requirement), before being Certified.

The Chinese Utility Model Patent undergoes a preliminary examination before proceeding to grant (usually completed within 6 to 18 months). This preliminary examination is more extensive than the formalities examination of the Australian Innovation Patent, but less extensive than the substantive examination carried out on the Chinese Invention Patent. In contrast to the Australian Innovation Patent, the Chinese Utility Model Patent does not legally require any further substantive examination to be enforced before a Court. However, in practice, the patentee of a Chinese Utility Model Patent is almost always required to provide a patentability evaluation report issued from the Chinese State Intellectual Property Office (SIPO) to the Chinese People’s Court during enforcement.  This report is similar to the Certification of Australian Innovation Patent.

Concurrent Innovation/Utility Model and Standard/Invention applications

One of the more powerful aspects of the Australian Innovation Patent system is that it is very flexible, and allows the filing of multiple Innovation Patents directly and/or as divisional patent applications from a pending Standard Patent application. While strict double patenting is not permissible, multiple Innovation Patents can be directed to different aspects of the same invention, provided that the scope of the claims of each patent does not overlap. It is also possible to retain these multiple Innovation Patents when the main Standard Patent is granted.

It is also possible to convert from a Standard Patent application to an Innovation Patent (under certain circumstances) and from an Innovation Patent Application to a Standard Patent application (under much more restricted circumstances).

While it is in some cases possible to have both a Chinese Utility Model and an Invention Patent directed to the same invention in China, there are severe restrictions relating to what can be done and the timing of filings. The rules governing this aspect can be quite complex and it is advisable to seek advice from a local Chinese patent attorney in each circumstance in good time to avoid irrevocable lapsing of rights.

Patentable Subject Matter

Almost any subject matter that can be protected under an Australian Standard Patent can be protected under an Innovation Patent. The only exception to this is plants and animals, which can be protected under Standard Patents but not under Innovation Patents.

The Chinese Utility Model Patent is more restricted, in that it can only protect a physical product. Methods, processes and chemical compounds for example, cannot be protected under a Utility Model Patent and such protection would need to be sought under the Invention Patent.

The table below compares some main features of each system:

 

AUSTRALIAN INNOVATION PATENT CHINESE UTILITY MODEL PATENT
Maximum term of 8 years Maximum term of 10 years
Patentable: physical products, methods, processes, chemical compounds Patentable: physical products only
Multiple patents?– very flexible Multiple patents? – more restricted
Examination – formalities examination to grant only Examination – preliminary examination to grant only
Enforcement – must request substantive examination (Certification) after grant before enforcing Enforcement – requires a patentability evaluation report (see “Examination” above for details.
Inventiveness requirement – very low Inventiveness requirement – potentially lower, but practically the same as the Invention Patent (but see “Inventiveness Requirement” above for details)
Number of claims – 5 Number of claims – no limit
Remedies upon successful enforcement – same as for Standard Patent Remedies upon successful enforcement– same as for Invention Patent
Conversion between Innovation Patent and Standard Patent? – yes, in some circumstances Conversion between Utility Model Patent and Invention Patent? – no.
Possible to enter national phase in Australia as an Innovation Patent from a PCT application? – no (although it is possible to file a divisional application of the pending international PCT application into Australia, or to enter national phase as a Standard Patent application and then either convert the Standard Patent application into an Innovation Patent or file a divisional as an Innovation Patent). Possible to enter national phase in China as a Utility Model Patent from a PCT application?Yes.
Possible to file as a Convention application in Australia claiming priority from a Chinese priority application? Yes – within 12 months of priority date. Possible to file as a Convention application in China claiming priority from an Australian priority application? Yes – within 12 months of priority date.

 

The above highlights some of the main differences and similarities between the Australian Innovation Patent and the Chinese Utility Model Patent systems, but it should be noted that there are many other subtle features of each system. Professional advice should be sought in each case to ensure that full advantage can be taken of both systems in each circumstance and to avoid inadvertent loss of rights.

  1. Australian Patents Act 1990, ss7(4)
  2. Article 22.3 of the Chinese Patent Law
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Registering Shapes, Colours and Other “Non-Traditional” Trade Marks

/ Louise Emmett / Articles

The world of trade marks has come a long way since Australian Trade Mark Registration No. 1 was filed back in 1906.  This registration, which is still in force today, covers chemical substances in class 5 and is for the following “traditional” style logo mark incorporating the words “PEPS for COUGHS COLDS & BRONCHITIS” (as shown above).

Over one hundred years later, trade mark owners are increasingly seeking to register creative “non-traditional” trade marks such as shapes, colours, sounds and even scents.  There are now hundreds of shape and colour trade mark registrations in Australia and, at the time of writing, 50 sound registrations and one scent registration.  Examples of these types of marks include:

  • Shape registrations for the shape of the TOBLERONE chocolate bar and the COCA COLA bottle;
  • Colour registrations for PURPLE for Cadbury chocolate and RED for the sole of Christian LOUBOUTIN shoes;
  • A sound mark registration in the name of McCain Foods (Aust) Pty Ltd for the words “AH McCAIN” followed by a “PING” sound and the words “YOU’VE DONE IT AGAIN”; and
  • A scent mark registration for EUCALYPTUS RADIATA for golf tees in the name of E-Concierge Australia Pty Ltd.

As with traditional trade marks, non-traditional trade marks must be sufficiently distinctive in order to be accepted by the Trade Marks Office for registration.  This means, for example, that it is likely to be difficult to register shapes that are common to the relevant trade and colours for which there is a competitive need.  It may be possible to overcome an initial “distinctiveness” objection by filing evidence with the Trade Marks Office showing the nature and extent of the use of the relevant trade mark, however, evidence of advertising that simply features a particular shape or colour, for example, is unlikely to be sufficient.  Evidence of advertising that draws attention to the shape or colour, on the other hand, may assist in demonstrating that a shape or colour has become distinctive in the market.  The guidelines published by the Trade Marks Office indicate that statements such as “Look for the star shaped box” or “Unusual colours; exceptional goods” are the type of promotional terms that may assist.

Securing trade mark registrations for the brand names and logos used by a business will in most cases be of primary importance, however, applying to register distinctive “non-traditional” trade marks may provide valuable additional protection.

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