When the innovation patent system was introduced in 2001, the government stated that its purpose was to stimulate innovation in SMEs by providing Australian businesses with industrial property rights for their lower level inventions.
The primary concern raised by the report is the system’s alleged failure to achieve its main objective of stimulating innovation of SMEs in Australia. A number of other concerns have also been raised, such as, the granting of unexamined rights and the level of innovation necessary for an innovative step.
In addition, the report suggest that the system is used in ways for which it was not originally intended, predominantly, when obtained by individuals and SMEs that have a limited understanding of its uses. At the same time, the system has been used by an overwhelming number of inventors and SMEs that have reportedly obtained an economic benefit from the system. Those users have indicated their satisfaction with the innovation patent system.
The report notes that the concerns do not imply the system’s complete failure. Therefore, there seems to be no clear justification behind the removal of the innovation patent system. Moreover, it has largely been argued that the concerns about the system can be addressed without its abolition.
It is feared that the abolition of the system will have a negative impact on local Australian applicants, being the vast majority of its users. One of the important functions of the system is providing a necessary litigation tool in the patent system. This function was apparently not taken into consideration. Overall, there are concerns that the proposal to abolish the system will have a significant detrimental effect on the ability of SMEs to protect their innovations.