Patent law changes on the horizon with signing of the CPTPP agreement

Friday 9th March 2018

Without the United States involvement in the Trans-Pacific Partnership (TPP) trade agreement in 2017, many speculated that the entire agreement was dead in the water. However, the remaining 11 countries have signed up to a revised deal - the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP). This article summarises the main changes relating to intellectual property in the final text of the CPTPP agreement.

The withdrawal of the United States from the Trans-Pacific Partnership (TPP) trade agreement in 2017 led many to speculate that the entire agreement was dead in the water. However, vowing to persevere and achieve a deal without the world’s largest economy, the remaining 11 countries (New Zealand, Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, Singapore and Vietnam) signed up to a revised deal in March 2018. From the ashes of the Trans-Pacific Partnership rises the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP).

The current status of the CPTPP is that the agreement has been signed by the member countries, but it has not yet been ratified by the members nor brought into domestic law.

From an IP perspective, the CPTPP is a heavily defanged version of the TPP in relation to owners’ rights and government enforcement obligations. For New Zealand, the law changes required will generally be minor. However, several key provisions of the TPP have been retained in the CPTPP.

What’s still in?

Grace period for patent applications

The CPTPP retains the requirement for all member countries to provide a grace period of 1 year prior to a patent filing date, during which public disclosure by the inventor or their assignee may be disregarded for the purposes of determining whether the invention is new. Currently, grace periods in New Zealand only apply in a very limited set of circumstances (such as where the disclosures were made in breach of confidence or were for the purposes of reasonable trial).  The grace period in the CPTPP could be good news for many New Zealand innovators, especially small and medium sized enterprises, as it provides a safety net for potential patent applicants that have inadvertently prejudiced their patent protection by disclosing their invention before an application is filed.  However, even with such grace period provisions in place, this should be considered a back-up only – it will be preferable, and in many cases still essential, to file a patent application before any public disclosure of the invention, not least because many other countries do not have equivalent grace periods.

Patent linkage

Patent linkage provisions are also carried over into the CPTPP. Patent linkage regulates situations where a pharmaceutical supplier wishes to gain marketing approval for a drug on the basis of bioequivalence with a competing drug already in New Zealand (e.g. a generics supplier wishes to introduce a generic version of a name brand drug).  If the original drug is covered by a patent in New Zealand, the details of which have been provided to Medsafe, then the patentee will be notified of anyone seeking to rely on that drug’s clinical trial data prior to granting marketing approval.  Currently, New Zealand has no patent linkage system.

Data exclusivity for agricultural and veterinary compounds

The CPTPP retains the requirement for a 10 year data exclusivity* period for agricultural chemical products that was part of the original TPP. However, New Zealand extended the protection for data exclusivity for agricultural and veterinary compounds to 10 years in late 2016. No further amendment to New Zealand’s laws is therefore required.

What’s out?

Data exclusivity for pharmaceuticals

Provisions extending the period of data exclusivity for pharmaceutical products and biologics have been discarded. New Zealand’s current period of data exclusivity for new pharmaceutical compounds is five years. No amendment to New Zealand’s law is necessary.

Patent term extensions

The CPTPP also quashes the patent term extension provisions for unreasonable delays in the patent office or for marketing approval. This means New Zealand’s maximum patent term will remain a non-extendible 20 years.

Digital rights, online copyright infringement and copyright duration

The CPTPP will not require any changes to New Zealand’s current laws protecting digital locks or digital rights management information. There is also no change to New Zealand’s current regulation of Internet Service Providers in relation to online copyright infringement.

The mandated extension of the copyright term in the TPP (perhaps the most unpopular requirement of the IP provisions to the general public) has been removed in the CPTPP. Whereas the TPP set a minimum copyright term of 70 years (or the life of the author plus 70 years), under the CPTPP New Zealand can retain its current copyright terms (which are currently set at 50 years, the life of the author plus 50 years, and, for certain industrially applied works, a term of either 25 or 16 years).

The demise of the TPP caused by the exit of the United States may cause some cynicism towards the assumption that the CPTPP is already a done deal. However, if the CPTPP does survive ratification and implementation into domestic law in New Zealand, the changes to IP laws at least appear relatively low key.

*Data exclusivity relates to the period in which data relating to the safety and efficacy of a drug or veterinary compound owned by the developer and provided to a government regulator cannot be relied upon by third parties.

This article is intended to summarise potentially complicated legal issues, and is not intended to be a substitute for individual legal advice. If you would like further information, please contact a Baldwins representative.

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