New guidelines on repeal of intellectual property exemption issued

30 August 2019

Changes to parts of Australia’s competition law relating to intellectual property (IP) matters, which come into effect on 13 September 2019, are explained in new ACCC guidelines published today.

The guidelines on the repeal of subsection 51(3) of the Competition and Consumer Act are designed to explain the ACCC’s enforcement approach to IP rights.

The repeal of subsection 51(3) means that certain types of IP-related conduct are no longer exempt from the cartel prohibitions, section 45 (anti-competitive agreements) and section 47 (exclusive dealing) of the Competition and Consumer Act (CCA).

Subsection 51(3) was repealed after recommendations from the Harper Competition Policy Review and the Productivity Commission’s intellectual property arrangements inquiry.

“This change means that conduct relating to intellectual property rights will now be treated in the same way as other conduct under Australia’s competition law,” ACCC Commissioner Stephen Ridgeway said.

“The repeal of this narrow and uncertain exemption has been recommended by multiple independent reviews over the last 20 years. Following the repeal, the ACCC will be able to address those rare instances where IP licensing arrangements may damage or hinder competition.”

“However, we understand that most IP arrangements encourage competition and innovation, to the benefit of consumers, and this repeal will not change our approach to those arrangements,” Mr Ridgeway said.

The guidelines set out the general principles that will guide the ACCC’s approach to applying the cartel prohibitions and sections 45 and 47 to previously exempt conduct, and also include examples of conduct that the ACCC considers is likely or unlikely to contravene the CCA after the repeal.

The guidelines were developed in consultation with a range of stakeholders, which has led to the inclusion of further detail about aspects of the CCA, including the operation of the cartel prohibitions and the ACCC’s likely approach to exclusive licensing arrangements.

“We thank those stakeholders who participated in our consultation process,” Mr Ridgeway said.

Release number: 
158/19
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