Intellectual Property

Recent Reforms to the Australian Designs Act

According to the recent reforms to the Australia Designs Act 2003 (Cth) (the Act), amended by enactment of the Designs Amendment (Advisory Council on Intellectual Property Response) Act 2021, Australian design laws became more flexible and its registration system more streamlined. The key amendments that came into effect as of 10 March 2022 are below.   Introduction of a Grace Period The introduction of a grace period is the most noticeable change to the Act. Under the old Act, if a designer was purposefully or inadvertently published prior to applying for the design registration, the design became prior art and thus lost its potential to be registered in Australia. The Act now includes a grace period provision which allows designers to have up to 12 months between publishing their design and filing an application for registration, bringing Australia’s designs law system in line with those of other nations like the United States of America. The grace period provision only applies to a publication or use that occurred on or after 10 March 2022.   Infringement Exemption for Prior Use The newly introduced grace period may create uncertainty for those who are not the registered owner of a design but have utilised the design during the grace period. As a result, a prior use exemption is also introduced to the Act in which you could avoid infringement of a registered design if your use occurred before the priority date of the registered design. This exemption seeks to strike a reasonable balance between owners’ and third-party interests and is intended to reduce the risk of designers waiting too long to file a design application after publicly disclosing the design, such as filing it towards the expiry date of the 12-month grace period.   Relief for Innocent Infringer Given that Australian designs are not published before they are registered, if someone used the design in between the filing and registration they would be at risk of infringement of the design. If you are found to be an innocent infringer, the court is able to refuse to pay compensation or lower the amount of damages. To rely on the innocent infringer defence, you must prove that you were unaware of the existence of a design application, that you had no reasonable means of knowing and that you had taken reasonable steps to ascertain whether the design was registered.   Exclusive licensee’s entitlement to bring infringement proceedings Previously, only the registered design owner could file a lawsuit if their design was allegedly infringed. Given that a substantial number of owners of Australian registered designs do not reside in Australia and that they are often reluctant to participate in court proceedings due to the costs, the exclusive licensees are relatively disadvantaged. The Act now allows an exclusive licensee of a registered design to initiate an infringement lawsuit in its name without the involvement of the design’s owner, thereby saving time and money spent informing or depending on the owner, when a third party infringes the design rights.    Removal of publication option The Act has also eliminated the option to request publication when a design application is filed. The purpose of the publication was to strategically put the design into the prior art base without pursuing the registration. However, this option was rarely used and also increased ambiguity to individual applicants as to which options they should choose. Further, the Act has introduced an automatic examination of a formality if a registration is not requested within 6 months of the filing date. Under the old Act, a design application would lapse if registration was not requested within 6 months.   Renewal of Design Registration It was unclear whether third parties were subject to infringement of a registered design in case the registered owner had not paid the renewal fees during the 6-month grace period for renewal. The amended Act makes it clear that a registered design does not cease if the renewal fee is paid within that timeframe.   Standard of the Familiar Person Test The Act also reduced litigation risks by clarifying the court’s ‘the standard of the informed user’ test to the less rigorous ‘the standard of the familiar person’ test. The informed user is a hypothetical individual whose knowledge and attributes are used to determine whether the designs are substantially similar in the overall impression. The Act now specifies that the notional person does not have to be a ‘user’ of the product in question but a person who is just familiar with the product or similar goods. The new familiar person test provision has been effective from 11 September 2021.   Written on 25/03/2022 Disclaimer: The contents of this publication are general in nature and do not constitute legal advice. The information may have been obtained from external sources and we do not guarantee the accuracy or currency of the information at the date of publication or in the future. Please obtain legal advice specific to your circumstances before taking any action on matters discussed in this publication.