News & Insights

After more than six years of waiting, Australia has finally aligned itself with its major trading partners in implementing a grace period for design registrations. This, and other amendments to the Design Act 2003 (Cth), have been implemented based on the recommendations from the Advisory Council on Intellectual Property’s Review of the Designs System: Final Report, delivered in March 2015.

We have always been a great fan of registering designs but feel they are an underutilised protection. These changes are a real positive step for our clients.

effective as of 10 september 2021

new grace period for designs

 A 12 month “grace period” has been introduced for designers who make their designs publicly available before they file an application for registration. While a welcome introduction, business owners should take note that the grace period does not apply to prior filed design or patent applications (that have been published) filed anywhere throughout the world.

 Relevantly, between now and 10 September 2022, the “grace period” will date back to 10 September 2021. This means that if you file a design application before 10 September 2022 and you have already disclosed the design to the public, then provided the disclosure occurred after 10 September 2021, the disclosure won’t invalidate the design.

effective as of 11 september 2021

defining a “familiar person”

Whether a design is considered distinctive, or is infringed by another design/product, is now assessed by the standard of a “familiar person“. A familiar person doesn’t have to have used the product, but merely be familiar with the product.

 While the new standard applies to anything after 11 September, the former standard of the informed user will still apply for all assessments relating to use of designs prior to 11 September 2021.

rectification of true owner of design

The registration of a design can now only be revoked on lack of entitlement grounds if the court is satisfied that it is just and equitable to do so. However, a court is able to order the rectification of the Design Register to correctly note the true owner of the design.

 This is a significant development as it allows the court to transfer ownership of a registered design to the true owner, thus maintaining validity of the design and giving the true owner the ability to enforce its design rights rather than cancelling the design registration.

effective as of 10 march 2022

enforcement by exclusive licensees

Exclusive licensees can bring proceedings to enforce infringement of certified designs.

This is a significant benefit for all exclusive licensees, though it has even greater significance for foreign owned subsidiaries, and master distributors where the owner of the certified design is an overseas entity. It means the infringement action can now be brought by the Australian entity. This removes the ability of the infringer to seek security for costs from the overseas entity.

Previously, if the certified design owner was an overseas entity, it would have to pay at least $100,000 into the court at the start of any infringement proceedings to cover the potential costs of the infringer in the event it was ultimately successful.

It should be noted that an exclusive licensee can’t bring proceedings prior to 10 March 2022, and won’t be able to claim damages for infringing conduct that occurs prior to 10 March 2022.

“prior user” infringement exemption

There is now a “prior user” infringement exemption. This protects third parties who begin using a design after a disclosure of it (e.g. during the grace period), but before the priority date of a registered design.

This exemption continues to apply after the design is registered. For example, a third party that commences use of the design before the priority date, can continue to use the design in perpetuity, provided the use is continuous and is done by it or a successor in title.

Notably, this exemption will not apply to designs with a priority date prior to 10 March 2022, even if infringement of those designs occurs after commencement. Accordingly, it is advantageous to file your design application prior to 10 March 2022 to avoid any third parties being able to take advantage of this exemption.

extension of “innocent infringer” defence

The existing “innocent infringer” defence will be extended to cover any “innocent” use by an infringer up until the earlier of when:

• it is notified that the design application has been filed; or
• the design is registered and published by IP Australia.

automatic assessment of design

Design applications will be assessed for registration after six months if registration isn’t requested at the outset. Additionally, you will no longer be able to request publication of a design.

design rights are enforceable during the renewal grace period

Where the renewal fee is paid within the renewal grace period, design owners can bring infringement proceedings against acts of infringement committed during the renewal grace period. This can take place even if these acts occurred in the period between the end of the prescribed period and prior to the renewal fee being paid.

looking for in depth discussion and real-world examples?

Macpherson Kelley’s Intellectual Property team, Mark Metzeling, Paul Kirton and Belinda Sigismundi will be running sessions in October 2021 on how these changes will impact your business and how you can take advantage of the amendments.

If you can’t wait until then, please get in touch with a member of our team.

The information contained in this article is general in nature and cannot be relied on as legal advice nor does it create an engagement. Please contact one of our lawyers listed above for advice about your specific situation.