Michael Ahern (Cork East, Fianna Fail)

I am pleased to bring this Bill before the House. In an increasingly knowledge-driven global economy, sustained economic growth is inextricably linked to the ability to innovate successfully. Protection of intellectual property is of crucial importance because intellectual property rights not only reward investments in new products and services but also ensure transfer of technology, stimulating further innovation.

The granting of patents for new inventions in order to secure to the inventor the exclusive right to exploit the invention for a limited period of time is a long-established and well known instrument of promoting technical innovation and industrial development.

After the Industrial Revolution and from the 19th century onwards, all industrialised countries established their own patent system tailored to meet each country's industrial strategy. In Europe, efforts to create a common patent system resulted in the establishment of the European Patent Convention, EPC, in Munich in 1973. That convention established a European Patent Office in Munich, the function of which is to grant, on the basis of one central application to that office, patents which would be valid in each contracting state designated by the applicant. In effect, a bundle of national patents emerge from a European patent application and in each designated country the European patent has the same legal effect as one granted by the local national patent office. European patents are granted only after an in-depth examination following a comprehensive novelty search in a collection of several million documents and, therefore, offer a high level of legal certainty. The EPC has 31 contracting states — all EU states except Malta, as well as Bulgaria, Romania, Iceland, Liechtenstein,Monaco, Switzerland and Turkey.

Industry today operates internationally to a far greater extent than it did when the European Patent Convention was established in the 1970s. In 1993, a major step was taken towards worldwide harmonisation of legislative and regulatory practices with the Agreement on Trade Related Aspects of Intellectual Property Rights, known as the TRIPs Agreement. That agreement is an annexe to the agreement establishing the World Trade Organisation, WTO, and compliance with the TRIPs Agreement is an essential requirement under the new world trading order.

The primary purpose of the Bill, as published, was to give effect to certain provisions of the TRIPs Agreement. Since then, there have been a number of other international developments in regard to patents. The Government considers it prudent to take all relevant developments on board in a single piece of legislation and the Bill was amended substantially through its passage in the Dáil to include the following: amendments consequent on the revision of the European Patent Convention, EPC; provisions to give effect to the Patent Law Treaty which was concluded under the auspices of the World Intellectual Property Organisation, WIPO, the UN agency which administers international treaties in the field of intellectual property; and miscellaneous necessary amendments to intellectual property legislation, mainly by way of clarification or correction.

I now turn to each of these constituent aspects. The main objective of the TRIPs Agreement, as contained in its preamble, is to reduce distortion and impediments to international trade by promoting effective and adequate protection of intellectual property rights and by ensuring that measures and procedures to enforce intellectual property rights do not themselves create barriers to legitimate trade.

Article 3 of the TRIPs Agreement obliges each member country to accord the same treatment to non-nationals as it does to its own nationals. Article 4 includes a most favoured nation provision according to which any advantage, favour, privilege or immunity granted by a member country to the nationals of any other country in regard to intellectual property rights must be accorded immediately and unconditionally to nationals of all other WTO member countries.

The standard for patentable subject matter is set in Article 27 of the agreement. Patents shall be available for any inventions, whether products or processes, in all fields of technology provided that they are new, inventive and capable of industrial application. Patents shall be available and patent rights enjoyable without discrimination as to the place of the invention, the field of technology and whether products are imported or locally produced.

There are three permissible exemptions to the basic rule on patentability. First, inventions, the commercial exploitation of which would be contrary to public order or morality, may be exempted. Second, inventions concerning diagnostic, therapeutic and surgical methods for the treatment of humans or animals may be exempted. Third, member countries may exclude from patentability "plants and animals other than micro-organisms and essentially biological processes for the production of plants and animals other than non-biological and micro-biological processes".

Our principal law relating to patents for inventions is contained in the Patents Act 1992. In general, the 1992 Act is in compliance with the provisions of the TRIPs Agreement relating to both the standard for patentable subject matter and the subject matter which may be excluded from patentability.

The main area where the 1992 Act needs to be updated to comply with the TRIPs Agreement relates to the provisions concerning compulsory licences. The right given by the grant of a patent is, in essence, a right, enforceable through courts, to prevent others from making, importing, using or selling the patented product. However, the patentee need not exercise this right; he or she may license others to do so.

The 1992 Act also contains provisions in sections 70 to 75, inclusive, concerning the compulsory licensing of patents without the authorisation of the patentee. The existing provisions of section 70(2) such as that the patent is not being adequately worked in the State or that the demand for a patented product in the State is being met by importation are contrary to Article 27.1 of the TRIPs Agreement which provides that "patents shall be available and patent rights enjoyable without discrimination as to place of invention, the field of technology and whether products are imported or locally produced".

Essentially, this means that where a patented product is exploited in any member country of the WTO and is then imported into another country in sufficient quantities to satisfy domestic demand there, a compulsory licence cannot be granted in that other country. Additionally, pursuant to Article 31 of the TRIPs Agreement, numerous conditions must be adhered to by member countries of the WTO should such countries provide for the possibility of granting compulsory licences under a patent.

Prior to the granting of a compulsory licence, the applicant for the licence must show that reasonable efforts to obtain a contractual licence from the patentee have failed. The licence shall be limited as to its scope and duration and it shall be of a non-exclusive nature. The compulsory licence shall be non-assignable and shall be granted predominantly for the supply of the domestic market. The compulsory licence shall be terminated if and when the circumstances which led to it cease to exist and are unlikely to recur. The patentee shall be compensated adequately depending on the circumstances of each case. The legal validity of the compulsory licences as well as any decision relating to the compensation shall be subject to judicial review.

Where compulsory licences are granted to permit exploitation of a second patent which cannot be exploited without infringing a first patent, three additional conditions apply: the invention claimed in the second patent shall involve an important technical advance of considerable economic significance; the patentee of the first patent shall be entitled to a cross-licence, that is, a licence to use the invention claimed in the second patent; and the licence in respect of the first patent shall be non-assignable except with the assignment of the second patent. Sections 19 to 23 of the Bill amend the existing provisions concerning compulsory licensing of patents as contained in sections 70 to 75, inclusive, of the 1992 Act to bring them into line with the TRIPs Agreement.

The Bill contains proposed changes to the 1992 Act consequent on the revision of the European Patent Convention, EPC, by a diplomatic conference in November 2000. The revised text of the EPC will enter into force, at the latest, two years after the 15th contracting state has deposited its instrument of ratification or accession. The 15th state deposited its instrument of accession on 13 December 2005. This means that all those states which have not yet ratified or acceded to the Act revising the EPC must do so by 13 December 2007 to avoid being excluded from the European Patent Organisation. Before Ireland may accede to the convention, as revised, our national law needs to be amended to bring it into line with the revised provisions.

The main changes now proposed in the Bill relate to patentability criteria and, in particular, explicit recognition that a patent may be obtained for a second medical use of a known substance; limitation of the effect of European patents following the central limitation procedure before the European Patent Office, EPO, introduced in the EPC revision; and provision for the protection of third parties where a patent is restored by the enlarged board of appeal of the EPO following its review of a decision of a board of appeal of the EPO.

The Bill contains provisions to bring our existing law into compliance with the Patent Law Treaty. The purpose of the treaty, which was concluded under the auspices of WIPO, is to harmonise the formal requirements for patent applications set by national and regional patent offices such as elements of an application, filing date, priority, time limits, etc., and to streamline the procedures for obtaining and maintaining a patent. The Patent Law Treaty does not relate in any way to substantive patent law, for example, the criteria to be satisfied for an invention to be eligible for patentability. Its focus is on procedural requirements involved with filing and prosecuting a patent application, such as filing date requirements and procedures to prevent loss of the filing date; formal requirements regarding patent applications; and mechanisms to avoid unintentional loss of rights. While there is no obligation to accede to the treaty, the adoption of its provisions will make it easier for applicants to prosecute and to maintain a patent application.

The opportunity is being taken in the Bill to effect a number of miscellaneous amendments to intellectual property legislation including trademark, copyright and industrial designs. Those amendments are mainly by way of correction or clarification and have been kept to those of the most pressing necessity. The amendments proposed to trademark legislation concentrate on ensuring Ireland's full compliance with the TRIPs Agreement; changes to reflect jurisprudence established by the European Court of Justice which necessitate amendments to the 1996 Trade Marks Act; and ensuring consistency with more modern intellectual property legislation in the area of search and seizure of infringing goods. The amendments proposed to copyright and industrial designs legislation are of a corrective nature.

As the Bill, as published, was substantially amended by the Dáil to include new provisions to give effect to the international obligations I have mentioned, I would like to turn now to its provisions and explain in greater detail what each is designed to achieve.

Section 1 sets out the definitions of Acts referred to in the Bill. Section 2 sets out the definitions of various terms used in the Bill. Sections 3 and 4 amend sections 9 and 10 of the 1992 Act to bring them into line with Article 27-1 of TRIPs and Articles 52 and 53 of the EPC, as amended. The changes provide that methods of treatment of the human or animal body and diagnostic methods practised on the human body which had previously been excluded from patentability under section 9 by the fiction of their lack of industrial applicability are now included as exceptions to patentability on public policy grounds under section 10. The amended section 9 makes it clear that patents are to be available for inventions in all fields of technology.

Section 5 amends section 11 of the 1992 Act to bring it into line with new Article 54(5) of the EPC and will now explicitly allow patent protection to be obtained for second and further medical uses of known substances or compositions.

Section 6 amends section 23 of the 1992 Act to reflect the requirements of Article 5 of the Patent Law Treaty and sets out the requirements that must be fulfilled to get a filing date for a patent application. The changes include a right to be accorded a date of filing even when the description does not comply with the language requirements of the legislation or other requirements. They also allow a reference, in lieu of filing a description, to a previously filed application to be used to obtain a date of filing. Another change proposed is that if a missing drawing or part of the description is filed subsequent to the date of filing of the application, the application will not be re-dated to that later date, if priority from a previous application is claimed and the requirements to be prescribed are met. One of those will be that the missing part of the description or drawing is present in the earlier application.

Section 7 amends section 25 of the 1992 Act and extends the existing right to claim priority from an earlier application filed in a State party to the Paris Convention for the Protection of industrial Property to a right to claim priority based on an earlier application in any member state of the WTO. Section 8 amends section 33 of the 1992 Act and provides for the possibility of correcting an error in the withdrawal of an application.

Section 9 amends the 1992 Act by the insertion of new sections 35A and 35B to allow for the re-establishment of rights as provided for in Article 12 of the Patent Law Treaty in the case of applications which had been refused or deemed withdrawn for failure to comply with a time limit. Section 35A sets out the conditions and procedures under which the Controller of Patents, Designs and Trade Marks shall reinstate an application, and section 35B sets out the effects of reinstatement of a patent application, including the protection for third parties.

Section 10 amends section 37 of the 1992 Act to clarify the protection afforded to third parties where a patent has been restored and to set out the effects of restoration. The existing protection for the intervening rights of third parties is set out in Rule 38 of the Patent Rules 1992, but the Attorney General's Office has advised us that it should be set out in the Act itself.

Section 11 amends section 38 of the 1992 Act to ensure consistency in approach to post-grant amendment in national proceedings and before the EPO. Section 12 amends section 42 of the 1992 Act regarding the use of patents on board vessels, aircraft and land vehicles. That arises from Ireland's ratification of the WTO Agreement. Section 13 amends section 45 of the 1992 Act and is a drafting revision to reflect minor amendments to Article 69 of the EPC. Section 14 amends section 50 of the 1992 Act to provide that relief for the infringement of a partially valid patent may be granted also on condition that the proprietor of a European patent designating the State limits the patent at the EPO.

Section 15 amends section 53 of the 1992 Act to introduce a further restriction on the bringing of proceedings for groundless threats of infringement. Under the new subsection (3)(b), proceedings may not now be brought by an aggrieved party where a person, for example, a patent proprietor, has threatened that party with proceedings in respect of acts of secondary infringement — such as selling or stocking the patented product or offering the patented process for use — provided the person being threatened has made or imported that product for disposal or used that process.

Section 16 amends section 58 of the 1992 Act to bring it into conformity with Article 138(1)(d) of the European Patent Convention. It clarities that section 58(d) relates only to amendment of the patent that occurred after it had been granted. Section 17 amends section 59 of the 1992 Act to provide that, in the case of a European patent designating the State, where the controller or the court has found that the grounds of revocation affect the patent only in part, the specification of the patent can be amended under section 38 of the Act, or the claims of the patent can be limited by the proprietor under the new central limitation procedure provided for in the revision of the European Patent Convention.

Section 18 amends section 68 of the 1992 Act to remove any discriminatory restriction on the importation of a patented product from another member country of the WTO. Sections 19 to 23, inclusive, substantially amend sections 70, 71, and 73 to 75, inclusive, of the 1992 Act to bring the provisions concerning compulsory licences into line with the requirements of Article 27.1 and Article 31 of TRIPs, which I have already outlined.

Section 24 amends section 92 of the 1992 Act to clarify that the provisions applicable to the taking of evidence by the Controller of Patents, Designs and Trade Marks applies equally to later enactments under which the controller has functions. Section 25 amends section 96 of the 1992 Act to ensure the three-month period for filing an appeal against a decision or order of the controller, in the instance where written grounds of the controller's decision have been sought, is computed from the date that the written grounds are furnished rather than from the date of the decision.

Section 26 amends section 110 of the 1992 Act and is consequential on the revision of section 33. It sets out the procedure to be followed where the controller receives a request to restore an application that has been withdrawn in error. Section 27 introduces a new section 110A to set out the effect of restoration of a withdrawn application, particularly the protection of the intervening rights of third parties. Section 28 inserts a new section 118A into the 1992 Act to reflect Article 11 of the Patent Law Treaty to provide that where the applicant or proprietor of a patent has failed to observe a time limit specified by the controller the person may be granted one extension as of right.

Section 29 amends section 119 of the 1992 Act to reflect that European patents may be limited or revoked by the European Patent Office at the request of the proprietor under the new central limitation procedure contained in the revision of the EPC. That section also provides for the consequences of the restoration of a European patent which has been revoked by a board of appeal and is subsequently restored by an enlarged board of appeal. Section 30 inserts a new section 119A to provide for the possibility of relief where a translation of a European patent designating the State published in French or German has not been filed within the prescribed period. Again, that is to provide for re-establishment of rights under Article 12 of the Patent Law Treaty.

Section 31 amends section 120 of the 1992 Act to reflect the omission of the current Article 54(4) from the revised EPC. The effect of this change will be that a European application designating the State will have prior art effect under section 11(3) on publication, even if the designation of the State has been withdrawn prior to publication. Also, consequent on the proposed amendment to section 37, the intervening rights of third parties, following the re-establishment of the applicant's rights under the EPC, are now set out in the section.

Section 32 amends section 121 of the 1992 Act to set out the protection afforded to a third party who may have begun to do an act which would not have constituted infringement based on the original translation of a patent or application, but which would constitute infringement based on a corrected translation. Section 33 makes a minor drafting amendment to section 122 of the 1992 Act to bring it in line with the terminology in Article 77 of the EPC.

Section 34 repeals the transitional provision set out in paragraph 4 of the First Schedule to the 1992 Act as that provision is inconsistent with Article 28 of the TRIPs Agreement. Section 35 amends the Second Schedule to the 1992 Act to introduce a new provision with regard to"equivalents", consequent on the revision of the protocol on the interpretation of Article 69 of the EPC.

Section 36 repeals two orders relating to agreements concerning priority with countries not party to the Paris Convention, made under section 25(5), which will become superfluous when section 7 of the Bill comes into operation. Section 37 amends section 2 of the Trade Marks Act 1996 to include a reference to the "Agreement establishing the World Trade Organisation".

Section 38 amends section 10 of the Trade Marks Act to bring it into line with jurisprudence established by the European Court of Justice which established that a trade mark can be refused on the basis of earlier rights if the earlier mark enjoys a reputation in the State and the later mark would take unfair advantage of that reputation, regardless of the issue as to whether the goods in both cases are similar or not.

Section 39 is linked with section 38 in that it relies also on jurisprudence established by the European Court of Justice. It amends section 14 of the Trade Marks Act to make it an infringing act for the proprietor of a mark to use a similar or identical mark to an earlier mark where the earlier mark enjoys a reputation in the State and the later mark would take unfair advantage of that reputation.

Section 40 amends section 25 of the Trade Marks Act to align the search and seizure provisions with those prevailing under more recent legislation in the intellectual property area such as the Copyright Act 2000. It extends the list of activities which can be carried out during a search and seizure operation, for example, making an inventory of the infringing articles, allowing the seizure of anything found which may be required in evidence and the power to require any person found on the premises to give his or her name or address for use in any subsequent legal proceedings.

Section 41 amends section 29 of the Trade Marks Act to include changes affecting the proprietorship of a mark to be regarded as transactions to be recorded in the Register of Trade Marks. Section 42 amends section 41 of the Trade Marks Act and extends the priority right, based on an earlier application in a country or territory with which Ireland has entered into an agreement for the reciprocal protection of trade marks, to successors in title of a person.

Section 43 amends section 60 of the Trade Marks Act to include a reference to the World Trade Organisation. Section 44 amends section 79 of the Trade Marks Act to ensure that the three-month period for filing an appeal against a decision of the controller of patents, designs and trade marks, in the instance where written grounds of the controller's decision has been sought, is computed from the date that the written grounds are furnished rather than from the date of the decision.

Section 45 is aimed at ensuring full TRIPs compliance in that anywhere in the Trade Marks Act the Paris Convention is referenced such references are expanded to include also the WTO agreement. Section 46 augments the transitional provisions of the Trade Marks Act 1996 arising from ratification of the WTO agreement. It safeguards the continuation of any bona fide use by any person who was, prior to the entry into effect of the WTO agreement, using a mark.

Section 47 amends section 364 of the Copyright and Related Rights Act 2000 by ensuring that in any court proceedings in which the controller is involved under the Copyright Act, the controller can neither be the recipient of an award for costs or be ordered to pay costs. Section 48 repeals section 367(2) of the Copyright and Related Rights Act 2000. The effect of this amendment is that the controller of patents will no longer be required, within a period of three months, to refer to arbitration a dispute referred to him under the terms of the Act as this has, in practice, proved impossible.

Section 49 amends section 57 of the Industrial Designs Act 2001 and clarifies beyond doubt that infringement proceedings cannot be instigated before the date of publication of registration of a design and, equally, that no criminal offence can be committed before that date. Section 50 amends section 84 of the industrial Designs Act 2001 to ensure that the three-month period for filing an appeal against a decision or order of the controller, in the instance where written grounds of the controller's decision has been sought, is computed from the date that the written grounds are furnished rather than from the date of the decision. Section 51 provides for citation and commencement.

This is a non-contentious Bill. While technical it is important in that it seeks to revise our patent law to reflect obligations under the TRIPS Agreement and the revision of the European Patent Convention and the Patent Law Treaty. It also proposes necessary corrections or clarifications to intellectual property legislation. I commend the Bill to the House.