The EU has recently introduced the Community’s “Design Patent Regulations” (DPR) which have been described as a landmark for protecting IP rights in Europe [2]
The objective of the DPR is to unify registered protection for industrial designs in Europe and to change the legal situation regarding design patents significantly in favour of the holder of the right.
The new Regulations rely on the Design Directive 98/71 of 1998, (“the Directive”) for validity. [11] The Directive had established the general legislative basis for intellectual property protection across all EU member states, provided the rights were registered.
A further EU initiative affecting design rights is the “Directive on the Enforcement of Intellectual Property Rights” 2004/48 [4] which was prompted by the need for protection against imitation. [3] and [4]
By examining some of the defining characteristics of design protection in both countries, I hope to highlight the differences and similarities between Australian and European design law.
Scope of protection
In common with patent law, design law depends on a statutory structure and the exclusive rights in design depend on formal protection. No rights are acquired on creation of the work, as is the case with the exclusive rights of copyright owners.
Art 1(2) of The Paris Convention for the Protection of Industrial Property of which the members of the EU and Australia are members, provides that industrial design shall be protected in all countries of the union. [16]
The EU offers inventors an unregistered design regulation and a grace period, whereas the ALRC had opposed the introduction of a grace period in Australia. The Government was concerned that Australian inventors would not obtain corresponding overseas registration. [8] The Australian Government also rejected an unregistered design right as incompatible with the registered design system. [10]
The EU grace period gives the designer a 12 months period commencing from the date of original disclosure to file the application for design registration. [14] The novelty of the design will not be destroyed for one year after disclosure and this allows a proprietor the opportunity to determine whether seeking protection for a design is likely to be worth the money and time required. (DPR Art. 1.2 (a) and Art. 7.2)
The grace period involves third parties in some legal uncertainty as to whether a design is going to be registered. However, this is only for a short period during which the competitors would not be free to copy the design anyway, because of the unregistered design provisions.
In Australia, as an alternative to registration, an applicant may elect to merely publish the design. Although no protection is obtained, the applicant would be safe from any later attempt by anyone else register the same design (which would now lack novelty). In either event, a request to either register or publish must be made within 6 months, or the application will lapse.
In the EU, publication of a registered design may be delayed by up to 30 months and the creation can be kept confidential until the owner is ready to disclose it. This can be of vital importance in an area such as fashion or automobiles where it is necessary to protect one’s designs form competitors whilst arranging the production of the design into the final product.
If at any time the applicant wishes to cancel his deferment he can do so by asking the office to publish the design. If the applicant chooses not to publish at all, the registration will lapse after 30 months. This offers a great deal of control to a designer/business over their creations.
A registered Community Design Patent grants an exclusive “right to prohibit” for 25 years (renewable every five years). This is in contrast to Australia’s considerably shorter protection of 10 years, which merely complies with TRIPS’ Directive Art.26/3 of a 10 year period of protection. The Government was of the opinion that it would not be in Australia’s interest to provide a period of registration in excess of international obligation. [17]
In practice, the holder of an Unregistered Design may encounter serious problems proving that the protection exists, but unregistered designs must meet the same criteria as registered ones – they must be new and have an individual character. An unregistered design will be protected only against deliberate copying and only for three years.
The protection is available from the date of disclosure of the design to the public within the European Union. Disclosure may occur through designs going on sale or through prior marketing or publicity.
An unregistered design is disclosed by making it available to the public in such a way that the interested parties operating within the Community could reasonably be aware of the design. The date and means of disclosure are crucial: it creates a right of unregistered Community design but can conversely destroy the novelty of a registered design if he latter is not applied for within 12 months of the disclosure.
One can disclose an unregistered design by, for example, a printed review bearing a date, a publication in a mass publication, an international exhibition, or a dated mail-out to all trade associations of a given industrial sector. The unregistered design holder must be able to prove the following to a third party in a court action against counterfeiting:
- proof of the date of the first disclosure of the design;
- proof that the design refers to the disclosed design;
- proof that the interested circles within the community could have been aware of the disclosure;
- proof that the counterfeiter has in fact copied the protected design.
Substantive examinations of registered design do not take place in Australia or the EU, and registration only provides a prima facie evidence of validity. In both systems, screening is limited to ensuring that the documents lodged are in the required form and it is for the courts to make a decision that a design is new etc. by comparing the registered design with the particular examples of prior art presented to the court.
Dual Protection
In all countries with a separate system of protection for designs and for artistic works, the possible overlap between the system is problematical. The difficulty lies in the lengthy term of copyright law and its lack of transparency makes copyright law unsuitable to regulate innovation in manufacturing.
In Australia, a product’s shape may fall within the definition of design under the Designs Act as well as being an artistic work within the meaning of the Copyright Act, 1968.
The Australian Copyright Law Review Committee 1959 (The Spicer Committee) had stated its preference for the NZ model of concurrent protection, which makes no distinction between artistic works and industrial designs. (In NZ, copyright protection for three dimensional designs is limited to 16 years). [5]
However, the Designs Law Review Committee 1973, was of the view that: “…designers, if they wish to “industrialise” their artistic work, should only be allowed to rely on the registered designs systems, and not the copyright system … a manufacturer should be able to ascertain whether he is free to manufacture an article or not”. [10]
Accordingly, the Copyright Act, 1968 was repealed to prevent dual protection, and, where copyright subsists in an artistic work and a corresponding design is registered, or has been industrially applied, it is not an infringement of copyright to reproduce the work.
In general, copyright law is not available in Australia to protect a product’s shape if that shape has been commercially manufactured and sold with the license of the owner of the copyright.
However, copyright protection may be available in Australia for “applied art” as a work of artistic craftsmanship, a building, or as a surface design of a two-dimensional pattern or ornament. The intention was that all three dimensional functional designs should be protected under the Designs Act or not at all. [6]
Historically, Europe has classified separation between copyright and design in three groups:
- Cumulation (no separation as in France’s “unity of art” approach, ie. no distinction between fine arts and applied arts, leaving it all to copyright). In the cumulation countries, it is not unusual for a manufacturer to claim copyright protection for spare parts. This could hinder the liberalization of the spare parts market, one of the aims of the new design doctrine.
- Non-Cumulation (no concurrent protection as in Italy before the directive, sui generic protection under a “duality of art” approach ie. designs are excluded from copyright separating artistic value from industrial character);
- Partial Cumulation (some concurrent protection for copyright designs that manifest exceptional creativity as in Germany, Scandinavia).
Although the EU issued a Copyright Directive to harmonise certain aspects of copyrights and related rights, including designs, the directive does not define what works are subject to copyright protection. Thus member states are continuing to determine whether local copyright protection extends to industrial design on their national level. (DPR Art.17)
Requirements for Validity
In Australia, s 5 of the Designs Act, 2003 defines design in the following terms: “Design, in relation to a product, means the overall appearance of a product resulting from one or more visual features of a product”. This definition, reinforced in s 8 of the Act uses “Design” in the sense of a design relating to a product, hence in Australia a design cannot be protected separately from the product (article of manufacture) to which it is applied, except as a component part of a complex product.
The EU Design Directive (Art 1.) defines “design” as the appearance of the whole or part of the product. Although the EU Directive confers protection on the outward appearance, not the product, in the EU a registered design is not tied to a specific industrial use but remains irrespective of the product to which it is applied.
The Australian distinction between design and product was a clear policy choice by the ALRC and accepted by Parliament [10] to demarcate the boundaries between protection for industrial designs and protection for patents as, if this distinction were not retained and registration conferred protection for the product rather than the design, designs law would essentially be providing the protection intended to be provided by patent law.
“Product” in the EU Directive is defined as any industrial or handicraft item including packaging, graphic symbols and typographic typefaces but excluding computer programs.
The former German design law (Geschmacksmustergesetz) protected any features discernible by human senses, including the tactile sense, which is no longer included in the DPR. The separate role of design protection is illustrated by the word “Geschmacksmuster” which translates as “fashion prototype” as distinct from the German for patent “Gebrauchsmuster”, which means “function prototype”.
In Australia and in the EU, an industrial design application satisfies the novelty requirement if no identical design has been made available to the public prior to the date of filing or the date of priority, if priority is claimed, with these distinctions:
In Australia the design must be “new” and “distinctive”, in the EU it must be “new” and have “individual character. The requirements for novelty and individual character, as well as the definition of subject matter falling into the prior art, can be traced back to TRIPS, Art.25 (1) which requires members of the WTO to provide protection for: “Independently created industrial designs that are new or original. Members may provide that designs are not new or original if they do not significantly differ from known designs…”
The two-step test has been criticized for expanding the single test in TRIPS which merely requires “individual character” as another definition of novelty. In the EU legislation “individual character” connotes individual human creativity. Accordingly, an example of a product which may not quality as a design is a tile pattern which was formed by a production machine automatically, due to technological reasons. [15]
The Australian Designs Act, 2003 s 16(1) provides that a design is “new” unless it is identical to a design forming part of the prior art base. In contrast to this, immaterial differences are disregarded in assessing novelty in the EU. (DPR Art. 4)
As in the Australian term “distinctive”, the concept of “individual character” in the EU turns on an overall impression on the informed user. Immaterial differences may be disregarded under the “distinctive” standards in Australia and the EU (DPR Art. 5.1) but a product will infringe a registered design if it is substantially similar to the registered design (S.16 (2) Designs Act, 2003).
The requirements for novelty in Australia is measured against an “absolute” or “universal” standard of prior art, which includes publication in a document anywhere in the world.
By contrast, the EU has adopted “subjective-relative” novelty from the law of Germany and the Benelux countries, which used to apply a relevant local trade standard. According to the Directive, a design is not considered to be in the prior art if:
- a) it could not have reasonably have become known to an informed user in the sector where registration is sought; or
- b) it was disclosed as a result of info provided by the designer during the grace period. (DPR Art. 6.1 and 6.2)
This confined EU standard is questionable, given that the internet has connected every part of the world, but it has made the risk of bringing enforcement proceedings easier to calculate for the owner of a design.
Art 6.1(a) means a defendant infringer will not be able to point to a similar design in some far corner of the world to have the design declared invalid.
In both systems, the assessment of “distinctiveness” is made by an “informed user”, but in the EU a more subjective four level test is applied by the court, to decide upon individuality:
- The judge examines the shape from the aspect of the relevant circle of end users.
- The judge estimates the probable level of the user’s knowledge;
- The judge examines the cognizability level within the relevant territory;
- The new design is compared with the formerly known shapes.
Exclusions
- a) Mere Function
Design legislation does not protect function, because that is the purpose of the patent system, and TRIPS Art. 25 confirms this principle by permitting members of the WTO to exclude designs which are dictated essentially by technical or functional considerations.
Accordingly, most countries generally exclude industrial design that: ”… solely serves to obtain a technical result.” as expressed in the “Model Law for Developing Countries on Industrial Designs s 2(2) WIPO, Geneva.
In contrast, the Australian Designs Act, 2003 in s. 7(2) provides that: “a visual feature may, but need not, serve a functional purpose” and functional designs are therefore not specifically excluded from registration in Australia.
In the EU, industrial designs which are solely dictated by the product’s technical function (Article 7.1) or its mechanical interface feature (Article 7.2), are not covered by the Directive: “Pursuant to this exception, a Community Design may not subsist in features that are solely dictated by technical function…. or placed in our around another product so that either may perform its function” (DPR Art.3.1).
- b) Mechanical Interface
The rationale against protection is that an exclusive right should not be granted for a technical effect that can be achieved in only one way since this would unduly restrict competition. This was confirmed in the leading case in the area of functionality, Philips v Remington, 2002, where the European Court of Justice, the highest court of the EU, considered Art 3.1 of the Trademark Directive (very similar legislation) for a three headed shaver and denied protection “…as it would…enable a (trademark) owner to obtain a permanent monopoly in matters of engineering”.
An example of a mechanical interface is a “must fit” part of a complex product, such as electrical connector. The mechanical interface exception aims to allow interoperability of products of different makes by not extending protection to the design of mechanical fittings. However, this exception does not apply if a design allows multiple assembly within a modular system, for example Lego bricks or stacking chairs.
- c) Spare Parts
Furthermore, in line with the DPR, designs which constitute a component part of a complex product (spare parts) will not be protected when used for the purpose of repairing that complex product so as to restore its original appearance.
This part of the new legislation has come under heavy fire because in most EU member states, including France and Germany, “visible” car parts (like body panels, glass, bumpers, lights) are protected by national design and copyright laws and can only be sold by the original car manufacturers.
Visible car parts are said to be worth more than 10 billion Euro annually and the European Car Makers Association (ACEA) claims that the adoption of the proposal would lead to the disappearance of 560,0000 jobs at European vehicle plants to the sole benefit of countries outside the EU, mainly Taiwan and China. [9] The Australian market is reportedly worth A$800 million a year and involves in excess of 640 small and medium size businesses. [18]
The opposing argument according to the European Campaign for the Freedom of Automotive Parts (ECAR) is, that failure to adopt the “repairs clause of the directive, will mean more expensive spares and an ongoing monopoly for car manufacturers in Europe. [9]
The European Policy Evaluation Consortium (EPEC) set out four future alternatives for spare parts:
- Liberalisation with no design protection at all;
- A renumeratioin system for the use of protected designs;
- A system of short term design protection (10 years);
- A combination of the above.
In most European countries, spare parts are design protected. The Commission [12] found that the prices for spare parts are lower where they are not design protected and has proposed that protection is to be removed subject to further enquiries on the legislation’s impact on industry and the jobs market [13].
Liberalisation would bring EU legislation in line with the Australian legislation which exempts spare parts from infringement as provided in s.72 of the
Designs Act, 2003. In Australia, although designs for spare parts can be registered under s 6(2) of the Act, a competitor engaged in the manufacture or sale of a copycat product would not be liable for infringement.
Until a system of uniform design protection for spare parts is created, EU Member Nations are relying on Art. 14 of the Directive, the so called “freeze plus formula” which allows member states to maintain existing national laws, the only change permitted being laws that favour the liberalization of the spare parts market.
REFERENCES:
[1] The ALRC Report No 74 (1995) refers in its recommendations to the EC Green Paper and proposed regulations which cumulated in the EU proposal in 1993.[2] The Community Design Patent Regulations, adopted by the Council 12/12/2001 (IP/01/1803) followed by Regulation IP/02/1535 giving OHIM (“The Office for Harmonisation in the Internal Market”) the administrative role and the power to register community designs.
[3] The International Chamber of Commerce estimates that counterfeit products account for roughly 5-8 % of world trade, causing a loss of up to 100 billion US dollars and a loss of 70,0000 jobs per year) Juergen Hermann: “The protection of industrial designs”. Les Nouvelles 6/2000 p.61
[4] “Directive 2004/48/EC of the European Parliament and of the Council” concerns all IP rights, including design, and forces member states to introduce measures to protect companies against counterfeiting and piracy. (Official Journal of the European Union L195/16 2/6/2004)
[5] Copyright Act 1962 (NZ) s.20B(1)
[6] “Arguments for and against dual protection” Govt Printer XCanberra 1973 paras 251 – 262
[8] ALRC Report No 74 at para. 3.36 and 3.37
[9] “Main Features of the harmonized European Design Law” European Integration Studies, Miskolc, Vol 3, Number 1 (2004) pp 3-8
[10] “The Government Response to the ALRC Designs Review” Recommendations 3, 44, 77
[11] “Directive 98/71/EC of the European Parliament and of the Council on the Legal Protection of Designs” (Official Journal of the European Communities L289/28, published 28/10/98)
[12] Art. 18 of the DPR provides for a method of revision regarding spare parts based on circumstances affecting the industrial sector. “EPEC’s Revision – Impact assessment of possible options to liberalise the aftermarket in spare parts” (www..oami.eu.int/en/office).
[13] “Proposal Directive of the European Parliament and of the Council amending Directive 98/71/ on the legal protection of Designs”. COM (2004) 582 Final
[14] Grace Period EC Regulation No 6/2002 on Community Designs
[15] Annette Kur: “Freeze Plus Melts Ice – Observations on the European Design Directive” IIC. 6/1999. 623 p.
[16] Paris Convention 1883 Australian Treaty Series 1972 No 12
[17] Explanatory Memorandum to 2003 bill introducing the Designs Act
[18] ALRC 1995a (16.11) citing NRMA and RACV submissions
Web Sites:
www.wipo.int/treaties/en/ip/paris/index
www.european-patent-office.org
Journal Articles:
“Geschmacksmusterreformgesetz”
Bundesministerium der Justiz,
Bundesgesetzblatt Jahrgang 2004 Teil 1 No 11 – 18.3.2004
“Neues Geschmacksmusterrecht”
Industrie und Handelskammer fuer Muenchen und Oberbayern
Svanja Roth, March 2004
“Sui Generis Intellectual Property Law Reform: Issues for Australia”
(Megan Richardson)
Victoria University of Wellington Law Review 3, 2001
“A Survey of Industrial Design Protection in The EU and in the USA”
(Kathrine A Levin and Monica B Richman) E.I.P.R. 2003, 111
“The Community Design Right in Practice” July/August 2002
(Reinhardt Schuster/Clemens Rubel/Martin Schloetelburg) www.managingip.com
“Design Protection in Domestic and Foreign Law: From the Berne Revision of 1948 to the Copyright Act of 1976.”
(J.H. Reichman) Duke Law Journal Volume 1983, 1143
“Protection of Industrial Designs in the US”
(Jonathan Hudis and Phillipe Signatore) E.I.P.R. 2005, 257
Books:
“Intellectual Property (Text and Essential Cases)”, 2005
(Rocque Reynolds and Natalie Stoianoff)
“Intellectual Property in Australia”, 2004
(McKeough, Stewart, Griffith)
“Intellectual Property (Cases, Materials and Commentary)”, 2005
(Ricketson, Richardson)
Looseleaf Services:
“Patents, Trademarks and Related Rights” (Lahore J)
“Australian Intellectual Property” CCH (1982)
Law Reports:
A.L.R.C. Report No 74, Designs, 1995
