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2 About the agency

IP Australia’s Portfolio Budget Statement outcome is:

Increased innovation, investment and trade in Australia, and by Australians overseas, through the administration of the registrable intellectual property rights system, promoting public awareness and industry engagement, and advising government.

To deliver this outcome, IP Australia administers Australia’s intellectual property (IP) rights system, specifically trade marks, patents, designs and plant breeder’s rights. The agency’s remit also includes providing advice to the Commonwealth Government on IP policy, promotion and awareness of IP, and contributing to bilateral and multilateral negotiations and development cooperation programs to support the global IP system for the benefit of the Australian economy and society.

The agency’s regulatory role includes granting exclusive IP rights for a period of time. This encourages innovation, investment and international competitiveness by:

  • creating a safe and secure environment in which to make the intellectual investment necessary to innovate and thereby encourage research and development
  • promoting the disclosure of inventions and follow-on generation of ideas
  • enabling firms to build brand value and business reputation which in turn contributes to improved consumer confidence
  • providing a legal framework in which to trade ideas.

IP Australia is a prescribed agency under the Financial Management and Accountability Act 1997 within the Department of Industry. It operates independently of the department on financial matters, and with some degree of autonomy on other matters. It recovers more than 98% of its costs by charging fees for its IP rights services. In 2013–14, IP Australia will manage $178.7 million in annual resourcing. Approximately 2% of this is appropriated departmental funding; the balance being receipts from IP rights applicants received under these Commonwealth Acts: Patents Act 1990, Trade Marks Act 1995, Designs Act 2003 and Plant Breeder’s Rights Act 1994.

IP Australia’s history dates back to the early 1900s. It recently celebrated the 110th anniversary of the opening of the Australian Patent Office in Melbourne in 1904, which began with four patent examiners and a handful of support employees. By 1933, the office had taken on responsibility for trade marks and designs and was situated in Canberra. Responsibility for plant breeder’s rights was added in 2005. Today IP Australia has grown to employ 1,181 employees (as at January 2014). It receives many thousands of applications per year for patents, trade marks, designs, and plant breeder’s rights. Copyright is administered separately by the Attorney-General’s Department.

In addition to IP Australia’s main office in Canberra, the agency has a Melbourne Patent Examination Centre (MPEC). This centre opened in 2008 and has approximately 50 employees.

IP Australia is an Australian Public Service (APS) leader in teleworking, providing flexible working arrangements for many employees. Twenty-three per cent of employees have access to telework, 13% of which have an arrangement to work remotely on a regular or permanent basis. Teleworkers are located across Australia with the exception of the Northern Territory.

Approximately 12% of IP Australia employees have a Doctorate qualification, which is eight times higher than the APS average of approximately 1.5%. IP Australia employs more men (53%) than women (47%). Five of the 10 Executive members are female.

Distribution by classification at IP Australia shows that 27% of non-Senior Executive Service (SES) employees are classified as Executive Level (EL) 1 or higher which is similar to the broader APS. IP Australia averages 194 employees per SES Band 1 officer position. This is nearly three times the APS average, though similar to other large operational agencies such as the Department of Human Services and the Australian Taxation Office.

IP Australia has two principal delivery groups—Patent and Plant Breeder’s Rights, and Trade Marks and Designs, which are supported by the Customer Operations Group. The agency also has groups responsible for policy and governance, business and information management solutions, strategic programs, people and communication, and finance, reporting and property.

In 2012–13, IP Australia examined more than: 25,000 patent applications, 62,000 trade mark applications, 1,400 designs applications and 268 plant breeder’s rights applications. It also maintained the registration of more than 1,100 individuals through the Professional Standards Board.

IP Australia’s strategic statement and strategic plan set out the agency’s direction, priority areas and strategic activities for 2013–18. Priority areas are:

  • Quality and consistency—to continue to strive for the highest possible standard of quality in the agency’s work so granted rights are robust and able to withstand any challenge.
  • Stakeholder confidence—to manage operations and stakeholder relationships to ensure IP Australia has an excellent reputation for effectiveness of its services.
  • Facilitate the strategic use of IP—to enable Australians to derive maximum value from the IP system through effective education/awareness and information services.
  • Speed and efficiency—to offer timely and efficient services which are consistent with the needs of IP applicants and the community as a whole.
  • Contribute to improving the IP System—to foster Australian innovation by shaping the development of the IP system both in Australia and abroad.

IP Australia is also a major collaborator on the international stage, working to harmonise the international IP system and reduce duplication of work across countries. These efforts are guided by the multilateral Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) and the World Intellectual Property Organization (WIPO) framework.

IP Australia has a newly appointed Director-General, Ms Patricia Kelly, who joined the agency in January 2014 from the Department of Industry. The Director-General is supported by senior executives, the majority of whom have been with IP Australia for a substantial period in leadership or management roles.

The growing importance of intellectual property to the Australian economy

As background to the agency’s work, IP rights provide an incentive to invest in innovation. They provide a right to exclude others from using an innovation in exchange for the full disclosure of the invention, brand name, design or new plant species. A well-functioning IP system can foster innovation and encourage the flow of ideas. It can benefit innovators, investors and consumers alike, as well as the broader community by incentivising investment in innovation while fostering the public dissemination of new ideas.

Investment in IP and the rights that protect this investment is increasingly recognised as important for productivity growth in developed countries. For example:

  • Last year Australian firms invested $38.9 billion in IP products, an increase of 6.8% year-on-year according to the Australian Bureau of Statistics. Investment has been growing continuously for the past decade, although official statistics only include research and development and copyright protectable investment. Still, this investment accounts for 2.6% of gross domestic product.
  • The Organisation for Economic Co-operation and Development’s broader measure of intangible investment includes the economic value of design, branding and firm-specific human capital in addition to research and development and content. As a percentage of value added by the business sector, Australian intangible investment was 7.9% in 2010.
  • Estimates based on Productivity Commission data suggest that 20% of productivity growth between 2003–04 and 2007–08 was caused by this type of investment.

As investment in IP and applications for IP rights continue to grow—with applications for all IP rights rising year-on-year in 2013—so too does the importance of IP policy and management.

IP rights are increasingly embedded in the products and services that make up the daily lives of Australians, ranging from IP standards in mobile telephony to patented medicines, from branded imports to Australian designed goods manufactured abroad. World trade in licences and royalties from IP rights have grown and outpaced world gross domestic product growth over the last two decades. Australia now has a trade deficit of $3.2 billion in IP trade, which is not necessarily an issue as long as imported technology improves domestic productivity.

Another clear indication of how IP is playing a more important role in the economy and society is that policy makers around the world are dealing with more and more IP issues. In addition to the more general policy issues around pharmaceutical patents and addressing backlogs, the last decade has seen policy initiatives on specific IP issues such as 3D printing, tax relief on patenting, IP rights investment funds, and patent ‘trolls’ to mention a few.

Investment in IP, and the use of IP rights, becomes more important in the effort to become a more inventive nation, with a focus on exporting and generating high-tech employment. IP rights are granted at the technological frontier, and shaped by an international system of trade agreements and treaties, as well as domestic decisions through the courts and the IP office. As these rights become more important for the economy, so too does the need to have a better understanding of IP, and to embed IP policy thinking across a broader range of Government and social engagement.