Seanad Éireann - Volume 184 - 26 October, 2006

Patents (Amendment) Bill 1999: Second Stage.

[1913]Question proposed: “That the Bill be now read a Second Time.”

  Mr. M. Ahern: I am pleased to bring this Bill before the House. In an increasingly knowledge-driven global economy, sustained economic growth is inextricably linked to the ability to innovate successfully. Protection of intellectual property is of crucial importance because intellectual property rights not only reward investments in new products and services but also ensure transfer of technology, stimulating further innovation.

The granting of patents for new inventions in order to secure to the inventor the exclusive right to exploit the invention for a limited period of time is a long-established and well known instrument of promoting technical innovation and industrial development.

After the Industrial Revolution and from the 19th century onwards, all industrialised countries established their own patent system tailored to meet each country’s industrial strategy. In Europe, efforts to create a common patent system resulted in the establishment of the European Patent Convention, EPC, in Munich in 1973. That convention established a European Patent Office in Munich, the function of which is to grant, on the basis of one central application to that office, patents which would be valid in each contracting state designated by the applicant. In effect, a bundle of national patents emerge from a European patent application and in each designated country the European patent has the same legal effect as one granted by the local national patent office. European patents are granted only after an in-depth examination following a comprehensive novelty search in a collection of several million documents and, therefore, offer a high level of legal certainty. The EPC has 31 contracting states — all EU states except Malta, as well as Bulgaria, Romania, Iceland, Liechtenstein, Monaco, Switzerland and Turkey.

Industry today operates internationally to a far greater extent than it did when the European Patent Convention was established in the 1970s. In 1993, a major step was taken towards worldwide harmonisation of legislative and regulatory practices with the Agreement on Trade Related Aspects of Intellectual Property Rights, known as the TRIPs Agreement. That agreement is an annexe to the agreement establishing the World Trade Organisation, WTO, and compliance with the TRIPs Agreement is an essential requirement under the new world trading order.

The primary purpose of the Bill, as published, was to give effect to certain provisions of the TRIPs Agreement. Since then, there have been a number of other international developments in regard to patents. The Government considers it [1914]prudent to take all relevant developments on board in a single piece of legislation and the Bill was amended substantially through its passage in the Dáil to include the following: amendments consequent on the revision of the European Patent Convention, EPC; provisions to give effect to the Patent Law Treaty which was concluded under the auspices of the World Intellectual Property Organisation, WIPO, the UN agency which administers international treaties in the field of intellectual property; and miscellaneous necessary amendments to intellectual property legislation, mainly by way of clarification or correction.

I now turn to each of these constituent aspects. The main objective of the TRIPs Agreement, as contained in its preamble, is to reduce distortion and impediments to international trade by promoting effective and adequate protection of intellectual property rights and by ensuring that measures and procedures to enforce intellectual property rights do not themselves create barriers to legitimate trade.

Article 3 of the TRIPs Agreement obliges each member country to accord the same treatment to non-nationals as it does to its own nationals. Article 4 includes a most favoured nation provision according to which any advantage, favour, privilege or immunity granted by a member country to the nationals of any other country in regard to intellectual property rights must be accorded immediately and unconditionally to nationals of all other WTO member countries.

The standard for patentable subject matter is set in Article 27 of the agreement. Patents shall be available for any inventions, whether products or processes, in all fields of technology provided that they are new, inventive and capable of industrial application. Patents shall be available and patent rights enjoyable without discrimination as to the place of the invention, the field of technology and whether products are imported or locally produced.

There are three permissible exemptions to the basic rule on patentability. First, inventions, the commercial exploitation of which would be contrary to public order or morality, may be exempted. Second, inventions concerning diagnostic, therapeutic and surgical methods for the treatment of humans or animals may be exempted. Third, member countries may exclude from patentability “plants and animals other than micro-organisms and essentially biological processes for the production of plants and animals other than non-biological and micro-biological processes”.

Our principal law relating to patents for inventions is contained in the Patents Act 1992. In general, the 1992 Act is in compliance with the provisions of the TRIPs Agreement relating to both the standard for patentable subject matter [1915]and the subject matter which may be excluded from patentability.

The main area where the 1992 Act needs to be updated to comply with the TRIPs Agreement relates to the provisions concerning compulsory licences. The right given by the grant of a patent is, in essence, a right, enforceable through courts, to prevent others from making, importing, using or selling the patented product. However, the patentee need not exercise this right; he or she may license others to do so.

The 1992 Act also contains provisions in sections 70 to 75, inclusive, concerning the compulsory licensing of patents without the authorisation of the patentee. The existing provisions of section 70(2) such as that the patent is not being adequately worked in the State or that the demand for a patented product in the State is being met by importation are contrary to Article 27.1 of the TRIPs Agreement which provides that “patents shall be available and patent rights enjoyable without discrimination as to place of invention, the field of technology and whether products are imported or locally produced”.

Essentially, this means that where a patented product is exploited in any member country of the WTO and is then imported into another country in sufficient quantities to satisfy domestic demand there, a compulsory licence cannot be granted in that other country. Additionally, pursuant to Article 31 of the TRIPs Agreement, numerous conditions must be adhered to by member countries of the WTO should such countries provide for the possibility of granting compulsory licences under a patent.

Prior to the granting of a compulsory licence, the applicant for the licence must show that reasonable efforts to obtain a contractual licence from the patentee have failed. The licence shall be limited as to its scope and duration and it shall be of a non-exclusive nature. The compulsory licence shall be non-assignable and shall be granted predominantly for the supply of the domestic market. The compulsory licence shall be terminated if and when the circumstances which led to it cease to exist and are unlikely to recur. The patentee shall be compensated adequately depending on the circumstances of each case. The legal validity of the compulsory licences as well as any decision relating to the compensation shall be subject to judicial review.

Where compulsory licences are granted to permit exploitation of a second patent which cannot be exploited without infringing a first patent, three additional conditions apply: the invention claimed in the second patent shall involve an important technical advance of considerable economic significance; the patentee of the first patent shall be entitled to a cross-licence, that is, a licence to use the invention claimed in the second patent; and the licence in respect of the [1916]first patent shall be non-assignable except with the assignment of the second patent. Sections 19 to 23 of the Bill amend the existing provisions concerning compulsory licensing of patents as contained in sections 70 to 75, inclusive, of the 1992 Act to bring them into line with the TRIPs Agreement.

The Bill contains proposed changes to the 1992 Act consequent on the revision of the European Patent Convention, EPC, by a diplomatic conference in November 2000. The revised text of the EPC will enter into force, at the latest, two years after the 15th contracting state has deposited its instrument of ratification or accession. The 15th state deposited its instrument of accession on 13 December 2005. This means that all those states which have not yet ratified or acceded to the Act revising the EPC must do so by 13 December 2007 to avoid being excluded from the European Patent Organisation. Before Ireland may accede to the convention, as revised, our national law needs to be amended to bring it into line with the revised provisions.

The main changes now proposed in the Bill relate to patentability criteria and, in particular, explicit recognition that a patent may be obtained for a second medical use of a known substance; limitation of the effect of European patents following the central limitation procedure before the European Patent Office, EPO, introduced in the EPC revision; and provision for the protection of third parties where a patent is restored by the enlarged board of appeal of the EPO following its review of a decision of a board of appeal of the EPO.

The Bill contains provisions to bring our existing law into compliance with the Patent Law Treaty. The purpose of the treaty, which was concluded under the auspices of WIPO, is to harmonise the formal requirements for patent applications set by national and regional patent offices such as elements of an application, filing date, priority, time limits, etc., and to streamline the procedures for obtaining and maintaining a patent. The Patent Law Treaty does not relate in any way to substantive patent law, for example, the criteria to be satisfied for an invention to be eligible for patentability. Its focus is on procedural requirements involved with filing and prosecuting a patent application, such as filing date requirements and procedures to prevent loss of the filing date; formal requirements regarding patent applications; and mechanisms to avoid unintentional loss of rights. While there is no obligation to accede to the treaty, the adoption of its provisions will make it easier for applicants to prosecute and to maintain a patent application.

The opportunity is being taken in the Bill to effect a number of miscellaneous amendments to intellectual property legislation including trademark, copyright and industrial designs. Those amendments are mainly by way of correction or [1917]clarification and have been kept to those of the most pressing necessity. The amendments proposed to trademark legislation concentrate on ensuring Ireland’s full compliance with the TRIPs Agreement; changes to reflect jurisprudence established by the European Court of Justice which necessitate amendments to the 1996 Trade Marks Act; and ensuring consistency with more modern intellectual property legislation in the area of search and seizure of infringing goods. The amendments proposed to copyright and industrial designs legislation are of a corrective nature.

As the Bill, as published, was substantially amended by the Dáil to include new provisions to give effect to the international obligations I have mentioned, I would like to turn now to its provisions and explain in greater detail what each is designed to achieve.

Section 1 sets out the definitions of Acts referred to in the Bill. Section 2 sets out the definitions of various terms used in the Bill. Sections 3 and 4 amend sections 9 and 10 of the 1992 Act to bring them into line with Article 27-1 of TRIPs and Articles 52 and 53 of the EPC, as amended. The changes provide that methods of treatment of the human or animal body and diagnostic methods practised on the human body which had previously been excluded from patentability under section 9 by the fiction of their lack of industrial applicability are now included as exceptions to patentability on public policy grounds under section 10. The amended section 9 makes it clear that patents are to be available for inventions in all fields of technology.

Section 5 amends section 11 of the 1992 Act to bring it into line with new Article 54(5) of the EPC and will now explicitly allow patent protection to be obtained for second and further medical uses of known substances or compositions.

Section 6 amends section 23 of the 1992 Act to reflect the requirements of Article 5 of the Patent Law Treaty and sets out the requirements that must be fulfilled to get a filing date for a patent application. The changes include a right to be accorded a date of filing even when the description does not comply with the language requirements of the legislation or other requirements. They also allow a reference, in lieu of filing a description, to a previously filed application to be used to obtain a date of filing. Another change proposed is that if a missing drawing or part of the description is filed subsequent to the date of filing of the application, the application will not be re-dated to that later date, if priority from a previous application is claimed and the requirements to be prescribed are met. One of those will be that the missing part of the description or drawing is present in the earlier application.

Section 7 amends section 25 of the 1992 Act and extends the existing right to claim priority from an earlier application filed in a State party [1918]to the Paris Convention for the Protection of industrial Property to a right to claim priority based on an earlier application in any member state of the WTO. Section 8 amends section 33 of the 1992 Act and provides for the possibility of correcting an error in the withdrawal of an application.

Section 9 amends the 1992 Act by the insertion of new sections 35A and 35B to allow for the re-establishment of rights as provided for in Article 12 of the Patent Law Treaty in the case of applications which had been refused or deemed withdrawn for failure to comply with a time limit. Section 35A sets out the conditions and procedures under which the Controller of Patents, Designs and Trade Marks shall reinstate an application, and section 35B sets out the effects of reinstatement of a patent application, including the protection for third parties.

Section 10 amends section 37 of the 1992 Act to clarify the protection afforded to third parties where a patent has been restored and to set out the effects of restoration. The existing protection for the intervening rights of third parties is set out in Rule 38 of the Patent Rules 1992, but the Attorney General’s Office has advised us that it should be set out in the Act itself.

Section 11 amends section 38 of the 1992 Act to ensure consistency in approach to post-grant amendment in national proceedings and before the EPO. Section 12 amends section 42 of the 1992 Act regarding the use of patents on board vessels, aircraft and land vehicles. That arises from Ireland’s ratification of the WTO Agreement. Section 13 amends section 45 of the 1992 Act and is a drafting revision to reflect minor amendments to Article 69 of the EPC. Section 14 amends section 50 of the 1992 Act to provide that relief for the infringement of a partially valid patent may be granted also on condition that the proprietor of a European patent designating the State limits the patent at the EPO.

Section 15 amends section 53 of the 1992 Act to introduce a further restriction on the bringing of proceedings for groundless threats of infringement. Under the new subsection (3)(b), proceedings may not now be brought by an aggrieved party where a person, for example, a patent proprietor, has threatened that party with proceedings in respect of acts of secondary infringement — such as selling or stocking the patented product or offering the patented process for use — provided the person being threatened has made or imported that product for disposal or used that process.

Section 16 amends section 58 of the 1992 Act to bring it into conformity with Article 138(1)(d) of the European Patent Convention. It clarities that section 58(d) relates only to amendment of the patent that occurred after it had been granted. Section 17 amends section 59 of the 1992 Act to provide that, in the case of a European [1919]patent designating the State, where the controller or the court has found that the grounds of revocation affect the patent only in part, the specification of the patent can be amended under section 38 of the Act, or the claims of the patent can be limited by the proprietor under the new central limitation procedure provided for in the revision of the European Patent Convention.

Section 18 amends section 68 of the 1992 Act to remove any discriminatory restriction on the importation of a patented product from another member country of the WTO. Sections 19 to 23, inclusive, substantially amend sections 70, 71, and 73 to 75, inclusive, of the 1992 Act to bring the provisions concerning compulsory licences into line with the requirements of Article 27.1 and Article 31 of TRIPs, which I have already outlined.

Section 24 amends section 92 of the 1992 Act to clarify that the provisions applicable to the taking of evidence by the Controller of Patents, Designs and Trade Marks applies equally to later enactments under which the controller has functions. Section 25 amends section 96 of the 1992 Act to ensure the three-month period for filing an appeal against a decision or order of the controller, in the instance where written grounds of the controller’s decision have been sought, is computed from the date that the written grounds are furnished rather than from the date of the decision.

Section 26 amends section 110 of the 1992 Act and is consequential on the revision of section 33. It sets out the procedure to be followed where the controller receives a request to restore an application that has been withdrawn in error. Section 27 introduces a new section 110A to set out the effect of restoration of a withdrawn application, particularly the protection of the intervening rights of third parties. Section 28 inserts a new section 118A into the 1992 Act to reflect Article 11 of the Patent Law Treaty to provide that where the applicant or proprietor of a patent has failed to observe a time limit specified by the controller the person may be granted one extension as of right.

Section 29 amends section 119 of the 1992 Act to reflect that European patents may be limited or revoked by the European Patent Office at the request of the proprietor under the new central limitation procedure contained in the revision of the EPC. That section also provides for the consequences of the restoration of a European patent which has been revoked by a board of appeal and is subsequently restored by an enlarged board of appeal. Section 30 inserts a new section 119A to provide for the possibility of relief where a translation of a European patent designating the State published in French or German has not been filed within the prescribed period. Again, [1920]that is to provide for re-establishment of rights under Article 12 of the Patent Law Treaty.

Section 31 amends section 120 of the 1992 Act to reflect the omission of the current Article 54(4) from the revised EPC. The effect of this change will be that a European application designating the State will have prior art effect under section 11(3) on publication, even if the designation of the State has been withdrawn prior to publication. Also, consequent on the proposed amendment to section 37, the intervening rights of third parties, following the re-establishment of the applicant’s rights under the EPC, are now set out in the section.

Section 32 amends section 121 of the 1992 Act to set out the protection afforded to a third party who may have begun to do an act which would not have constituted infringement based on the original translation of a patent or application, but which would constitute infringement based on a corrected translation. Section 33 makes a minor drafting amendment to section 122 of the 1992 Act to bring it in line with the terminology in Article 77 of the EPC.

Section 34 repeals the transitional provision set out in paragraph 4 of the First Schedule to the 1992 Act as that provision is inconsistent with Article 28 of the TRIPs Agreement. Section 35 amends the Second Schedule to the 1992 Act to introduce a new provision with regard to “equivalents”, consequent on the revision of the protocol on the interpretation of Article 69 of the EPC.

Section 36 repeals two orders relating to agreements concerning priority with countries not party to the Paris Convention, made under section 25(5), which will become superfluous when section 7 of the Bill comes into operation. Section 37 amends section 2 of the Trade Marks Act 1996 to include a reference to the “Agreement establishing the World Trade Organisation”.

Section 38 amends section 10 of the Trade Marks Act to bring it into line with jurisprudence established by the European Court of Justice which established that a trade mark can be refused on the basis of earlier rights if the earlier mark enjoys a reputation in the State and the later mark would take unfair advantage of that reputation, regardless of the issue as to whether the goods in both cases are similar or not.

Section 39 is linked with section 38 in that it relies also on jurisprudence established by the European Court of Justice. It amends section 14 of the Trade Marks Act to make it an infringing act for the proprietor of a mark to use a similar or identical mark to an earlier mark where the earlier mark enjoys a reputation in the State and the later mark would take unfair advantage of that reputation.

Section 40 amends section 25 of the Trade Marks Act to align the search and seizure pro[1921]visions with those prevailing under more recent legislation in the intellectual property area such as the Copyright Act 2000. It extends the list of activities which can be carried out during a search and seizure operation, for example, making an inventory of the infringing articles, allowing the seizure of anything found which may be required in evidence and the power to require any person found on the premises to give his or her name or address for use in any subsequent legal proceedings.

Section 41 amends section 29 of the Trade Marks Act to include changes affecting the proprietorship of a mark to be regarded as transactions to be recorded in the Register of Trade Marks. Section 42 amends section 41 of the Trade Marks Act and extends the priority right, based on an earlier application in a country or territory with which Ireland has entered into an agreement for the reciprocal protection of trade marks, to successors in title of a person.

Section 43 amends section 60 of the Trade Marks Act to include a reference to the World Trade Organisation. Section 44 amends section 79 of the Trade Marks Act to ensure that the three-month period for filing an appeal against a decision of the controller of patents, designs and trade marks, in the instance where written grounds of the controller’s decision has been sought, is computed from the date that the written grounds are furnished rather than from the date of the decision.

Section 45 is aimed at ensuring full TRIPs compliance in that anywhere in the Trade Marks Act the Paris Convention is referenced such references are expanded to include also the WTO agreement. Section 46 augments the transitional provisions of the Trade Marks Act 1996 arising from ratification of the WTO agreement. It safeguards the continuation of any bona fide use by any person who was, prior to the entry into effect of the WTO agreement, using a mark.

Section 47 amends section 364 of the Copyright and Related Rights Act 2000 by ensuring that in any court proceedings in which the controller is involved under the Copyright Act, the controller can neither be the recipient of an award for costs or be ordered to pay costs. Section 48 repeals section 367(2) of the Copyright and Related Rights Act 2000. The effect of this amendment is that the controller of patents will no longer be required, within a period of three months, to refer to arbitration a dispute referred to him under the terms of the Act as this has, in practice, proved impossible.

Section 49 amends section 57 of the Industrial Designs Act 2001 and clarifies beyond doubt that infringement proceedings cannot be instigated before the date of publication of registration of a design and, equally, that no criminal offence can be committed before that date. Section 50 amends section 84 of the industrial Designs Act [1922]2001 to ensure that the three-month period for filing an appeal against a decision or order of the controller, in the instance where written grounds of the controller’s decision has been sought, is computed from the date that the written grounds are furnished rather than from the date of the decision. Section 51 provides for citation and commencement.

This is a non-contentious Bill. While technical it is important in that it seeks to revise our patent law to reflect obligations under the TRIPS Agreement and the revision of the European Patent Convention and the Patent Law Treaty. It also proposes necessary corrections or clarifications to intellectual property legislation. I commend the Bill to the House.

  Mr. Coghlan: I welcome the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Michael Ahern, to the House and welcome the Bill, which is supported by Fine Gael.

While the Bill is not contentious, it gives us the opportunity to debate patents generally. The Bill is a technical one as borne out by the Minister of State’s references to the various sections. This is the nature of the legislation and more detailed discussion is more appropriate on Committee Stage, though I do not envisage much contention then either. It is not the kind of legislation to keep people awake at night worrying and I do not envisage the debate making the news headlines tonight.

  Mr. Leyden: That was said in 1992.

  Mr. Coghlan: Somebody else must have said it then. Legislation relating to intellectual property is vital to the economy and to our place in the international community. Many people know little about patents as the area is highly technical. We should try to disseminate knowledge about the process. People should be aware of how important the process is and how to apply for a patent and should be informed of the costs involved and the help available to them — from Enterprise Ireland and others — when making patent applications. While some things can be patented, others cannot. There is currently much controversy about patenting the human gene and mapping the human gene sequence. Perhaps we should return to this controversial area if other Members do not cover it.

I welcome the Bill as it brings us into line with the international community. We should disseminate more information on patenting and copyright and introduce the topic in schools to inform people of what is involved. It is expensive and time consuming to patent an item. Much work is involved in investigating the novelty of an invention and if a person is not careful, an invention can be stolen by another person. If a person makes his or her invention known prior to patent[1923]ing, he or she will lose the right to patent it. Patenting is a complex, technical, legal and expensive business. Large companies wishing to patent an item have the substantial resources required to do so.

Deputy Stanton asked in the Dáil about inventors who work from garden sheds where many inventions and businesses began. For example, Bill Gates started his business in a shed. We must encourage such people and inform them that support is available and accessible. Enterprise Ireland is doing a great deal in this area, but complaints have been made by the Inventors’ Association of Ireland and others. I hope their issues have been addressed. Perhaps the Minister will monitor the situation. An Irish Bill Gates could be working on an invention in a garden shed. Therefore, education and dissemination of information on the patent process are vital.

The decentralisation of the Patents Office is laudable, but the Government must be careful when moving specialised staff. Were all of them willing to move or was some expertise lost? Such considerations must be taken into account. How has the office operated since decentralisation?

Fine Gael has been vocal on the issue of patents in the European Parliament. In July 2005, the European Parliament rejected proposals to create a Europe-wide patent for computer implemented inventions. Speaking in the debate, Deputy Coveney MEP, stressed that the patents directive does not propose the introduction of a new patents system for the European Union, but harmonises and brings consistency to patent offices throughout the different member states. The current situation of 25 national patent offices with no consistent approach does not contribute to an integrated and functional common market.

The software and information technology industries in the EU have thrived under the current position. Why do we need a common approach? SMEs in particular seem to be split on this issue. Some people have decided to create the impression that this issue pitches the large multinationals against SMEs, but the latter fall on both sides of the argument. Some want to protect their ideas and inventions and others fear a patents minefield due to the proposed common position. Nobody in the European Parliament wants to vote for a situation that will harm the future of SMEs.

The two key issues in the directive were the definition of what it proposed to allow patents on and interoperability. We are not talking about the patenting of software as in the US. On interoperability, we must ensure the equipment or networks required by multiple users to allow innovation are not withheld from the market. In particular, this is the case for the open source movement, which has been successful in recent years. Unfortunately, that rejection of the pro[1924]posal showed a serious failure of the institutions to find common ground and agreement on what is an important area for the European economy generally. It is disappointing that the Bill has taken so long to pass through the Oireachtas, but I wish it a speedy passage through the remaining Stages in the House.

  Mr. Leyden: I welcome the Minister of State, Deputy Michael Ahern, and his officials to the House. Repetition is not allowed——

  Mr. M. Ahern: That will not stop the Senator.

  Mr. Leyden: Repetition every 13 years is allowed. My colleague on the other side of the House, Senator Coghlan, stated this was not legislation to keep him awake at night, which was also stated in 2000.

  Mr. Coghlan: I was talking about other people rather than myself. I could not be included.

  Mr. Leyden: In April 2000, Deputy Stanton stated, “This is not the kind of legislation to keep people awake at night”. It is strange that it has been repeated. In 1991——

  Mr. Coghlan: We probably have the same script writer.

  Mr. Leyden: ——I introduced the original Bill in the Dáil. At that time I stated, “Patent law has been revised only once since the foundation of the State. That revision was in 1964 and the Patents Act of the same year is still the current law on the subject.” I was aware of the Bill’s significance, as having a good patent law led to the success of the economy to some extent. I also stated:

I should like to mention another patent convention, namely, the Community Patent Convention, which was signed by Ireland and other Community member states in 1975. It will not be possible to ratify that convention on the basis of the present Bill because an amendment of the Constitution is required before ratification of this convention can take place. This matter will be kept under review in the context of other possible amendments of the Constitution which may arise in the period ahead.

Will the Minister of State clarify what has transpired since 1991?

This Bill was introduced in 1999 before the last general election, at which time it fell, and it would be an exaggeration to say there is urgency about it. Matters have proceeded well enough since then. During the debate, I was advised the Government was considering establishing either a semi-State or independent commercial patents office. Has the Minister of State considered this matter? The Patents Office was decentralised to Kilkenny successfully ahead of time, but it was [1925]difficult to decentralise such a technical office of 74 staff.

Intellectual property rights comprise a key element in promoting competitiveness and economic growth. In 2004, the office sought to provide business, industry and individual entrepreneurs with an effective and vital system of protection of their intellectual property rights. The office continues to expand its collection of patent information in electronic format with publicly searchable Irish, European, American and Japanese documents available on CD-ROMs and DVDs at information centres in Dublin and Kilkenny. It is vital for the development of industry that information on what has been invented around the world is available. There are many new ideas, but it is important the wheel is not re-invented and people know what is patented throughout the world. It is a worthwhile service.

In 2004, the Patents Office promoted awareness of industrial property protection of information via attending a number of exhibitions and seminars. The office is an annual exhibitor at the Esat BT Young Scientist and Technology Exhibition in the RDS and sponsored a prize in the competition in January 2004. Its special awards were won by students of the Christian Brothers grammar school in Newry. It is noteworthy that students of the school have won the award several times. It is important that the office should continue this type of promotion and reinforce in schools the notion that patents should be registered through available facilities.

Ideas are formulated all of the time. Agents acting for individuals can provide an excellent service, but one does not need an agent to register a patent. For people with ideas, going through the procedures can be awesome. Therefore, more public awareness would be worthwhile and the Minister of State should examine the matter in his capacity in the Department of Enterprise, Trade and Employment. The Patents Office is doing well, but some people are unaware of its existence. I do not know whether individuals from the office are present, but I wish to commend them on supporting investment in education.

In May 1997, the Minister for Enterprise and Employment decided to establish a Patents Office users council, the terms of reference of which were to consider and report to the Minister on the administration of industrial property protection by the Patents Office and advise on appropriate changes and innovations in its operation. Will the Minister of State indicate how well the council is operating? The proposal was a useful one because it would make the public more aware of patenting opportunities.

People have often told me they have ideas they wish to put forward. It is important those ideas are sent to the Patents Office for registration, because they can be of worth to the country and [1926]the individuals in question. Using cats eyes in the middle of the road is a good example. A simple idea based on cats’ eyes reflecting light at night made a fortune for the inventor and created a large industry. I have told people to register their ideas rather than allow someone to take their ideas and create industries around them.

12 o’clock

The Bill has taken time to appear before the House because it is technical in nature. People must be made aware of patents through the education system. People have ideas all of the time and they should be allowed to register them and create a viable industry. Ireland is innovative and some of its business people have been inventors. For example, the submarine was invented in Ireland and Henry Ford was an Irishman. One could go through an entire litany of people. Sometimes we do not recognise what was achieved here in this country. Such people are still there. There are many young people, and older people, who have ideas to offer.

In 2004 there were only 496 patents granted. It seems a small number. The numbers are dropping somewhat. The numbers of applications are falling also, which is rather strange. At the end of 2004, the latest year for which I have figures, there was a total of 2,395 pending applications on hand. Of these, it is interesting to note that 980 applications were awaiting the submission of evidence of novelty or originality.

I can assure the Minister of State that at the time of the passage of the Patents Act 1992 there were thousands of applications pending. That is why the emphasis at the time was on relocating the office to Kilkenny, increasing the number of staff and providing the opportunities contained in that Act. It was envisaged that we would create an independent semi-State company, which would look after this entire area and would provide other possibilities of increasing income as well. Perhaps the Minister of State would mention that in his concluding remarks.

The advice of the Attorney General at the time was that a constitutional amendment was required, but I could not figure out what was to be amended. It is interesting that a Bill was presented to the House in 1992 when we are now considering another Bill dealing with this office. In 1992 I was advised by my officials on the appropriate pronunciation of the word “patents”.

  Mr. M. Ahern: I am a man of the ordinary people.

  Mr. Leyden: I am not questioning the Minister of State’s interpretation.

The earlier Bill was brought to this House by former Minister for Industry and Commerce, Des O’Malley, in January 1992. I am not sure where I was at that time, but that year there were certain events happening and much trauma within the Fianna Fáil Party.

[1927]A patents Bill is before the House again. It is interesting that Senator Coghlan has reiterated what was stated then by, I think, the then Senator Myles Staunton, although the Official Report of the debate does not contain his Christian name.

  Mr. M. Ahern: He was the only Staunton.

  Mr. Leyden: There was another Staunton, or Stanton, since. The Official Report of the debate does not contain the Christian name of the contributor.

  Mr. Coghlan: One is Stanton and the other Staunton.

  Mr. Leyden: Peter Barry, the former deputy leader of the Fine Gael, made a great contribution to the debate on the 1991 Bill when he spoke of his experience as a business person.

I commend this Bill to the House and wish the Minister of State well.

  Mr. Quinn: I wish to share time with Senator O’Toole.

I welcome the Minister of State and his officials to the House. I was not going to refer to keeping people awake at night because there has been enough talk about insomnia on this. I offer my sympathy to the Minister of State on this detailed Bill. I had to read the following sentence in the Minister of State’s speech half a dozen times before I understood it:

The changes provide that methods of treatment of the human or animal body and diagnostic methods practised on the human body which had previously been excluded from patentability under section 9 by the fiction of their lack of industrial applicability are now included as exceptions to patentability on public policy grounds under section 10.

That we are discussing a Bill which first saw the light of day in the last millennium, as Senator Coghlan stated, sends a clear message to the world which, from the point of view of Ireland, is far from desirable. It reflects a regrettable fact about this country, which is, that we do not take seriously enough the question of intellectual property. We cannot continue like this. If we want to become a leading light in the knowledge society whose very lifeblood is intellectual property, we cannot hope to be taken seriously by the rest of the world if we treat intellectual property with scant respect, as we in this country tend to do.

For instance, every year the software industry publishes figures of the proportion of Irish computers that use pirate software, and those figures are shocking. I could perhaps understand it if this was a poor Third World country where people simply cannot afford to pay the retail price of software. Not only is this not a poor Third World [1928]country, this is a rich country that also has the potential to present itself as one of the world’s leading sources of software for various purposes. What a paradox that is, to be at the same time a leader in the production of software and also a leader in the pirating of software. Nobody seems to care much about this contradiction.

Our indifference extends to intellectual property far beyond software. There is in this country a thriving black market in counterfeit goods of all kinds. The list of cheap knock-offs of leading clothing and footwear brands and counterfeit CDs and DVDs of music and films is a long one and so are the queues of people who line up to buy these illicit products.

There are laws on the Statute Book that make the infringement of intellectual property a crime and today we are in the process of adding to that body of law, but these laws seem to have little support from the public and it also seems that little energy is put into that task of enforcing them. I realise that Ireland is not the only country where this applies. I was in Italy a few months ago and I could not believe the amount of counterfeit goods such as watches and handbags being sold. The police force there seemed to ignore such activity. The same applies in many other countries, but we have made serious investment in this area and therefore it matters to ensure that it is understood.

The Bill is driven, not by any wish to protect intellectual property but instead by the wish to conform to the international treaties and agreements on intellectual property to which this country has signed up in the past. We should ask ourselves if we are conforming to our international obligations merely by putting these laws onto our Statue Book. Is there not also a burden on the State to energetically enforce the laws we pass? That is the real challenge to us. Are we not obliged to educate our people on the rights and wrongs of intellectual property? Senator Leyden referred to this aspect. We have a job to do in enforcing the laws and educating people in terms of understanding them.

Our casual attitude to copyright and patent infringement reminds me a little of the way some people look on the making of false insurance claims. Senator O’Toole has played a large part in changing that attitude in recent times with the work that he has been doing, but it seems that false insurance claims were not regarded as something to be ashamed of in the past. Ripping off an insurance company, some used think, was a victimless crime and some may continue to hold that view. In reality, of course, it is anything but that since, ultimately, it is not the insurance company that pays but the general body of policyholders, in other words the customers.

Despite this, we get the same kind of double think that allows people complain about high insurance rates while at the same time turning a [1929]blind eye to those who try to rip off the purpose of insurance by making false or exaggerated claims. In this regard I have been most impressed in recent times by the advertisements, not from the State but by insurance companies and others who have come together, to remind people they are breaking the law and to encourage others to report them.

Stealing intellectual property is not a victimless crime. Offenders sometimes take refuge in the defence that the people who are hurt are the big guys who can afford to take that punishment. It is difficult to feel sorry for Microsoft but it is easy to feel at least a twinge of sympathy for someone whose victim is the richest man in the world. It is equally difficult to feel sorry for songwriters or film production company executives who tend to be mega millionaires as a result of what they have created. All that tends to ignore the basic reason we have laws to protect intellectual property. They are in place to guarantee their creators a profit from their endeavours, not to enrich people as such but to encourage them to continue creating new concepts and ideas and to encourage other people to imitate them. Ultimately, laws on intellectual property are for the benefit of those who enjoy the creations, not the creators. At the extreme, if a person who creates intellectual property could not profit from it, all his or her creative effort and innovation would die out and every time software is pirated or a counterfeit compact disc is bought, the basic principle of rewarding the creator is diluted.

In our own selfish interest, we, in this country, cannot permit this to happen. In this war against the stealing of intellectual property, there is no doubt about which side we need to be on. The knowledge society is our future in Ireland and one of the clear implications of that is we should be among the leaders in protecting intellectual property. We need to do more than go through the motions of passing laws such as this, as we also need to be energetic in enforcing our intellectual property laws. We must encourage and educate our people to add to them. I welcome the Bill.

  Mr. O’Toole: I thank Senator Quinn for sharing his time.

I welcome the Minister of State to the House. This is another complex issue, with which he will deal quietly and move on. Anything do to with patent laws usually gets the industrial sector into a twist. During the 1990s when there were problems and proposals regarding the extension of the period of patient, there was chaos in sectors of industry. I agree with everything Senator Quinn said. Ten years ago, a significant proportion of domestic industry was based on out-of-time patents and, consequently, the entire chemical industry was using generic combinations of drugs, which had been used under patent previously. [1930] The patent period was 16 years up to then but it was extended in the mid-1990s to 20 years. During the negotiations on the patent extension, companies stated they would go out of business. To this day, investment in research and development in Ireland is the lowest in Europe. Ten years ago the next lowest to us was Belgium and our investment as a percentage of GNP was 50% of Belgium’s. We have improved somewhat but not enough.

The Minister for Finance said in his last Budget Statement he would actively seek co-operation among third level colleges and institutes of technology to promote research and development. To avail of patent legislation, ideas must be produced. People must be encouraged to articulate their ideas, get them to a near market stage, bring them to incubation centres, which are attached to most institutes of technology where they will be helped to develop, refine and sophisticate their ideas, before bringing them to finality at which point they can then be lodged as a patent and brought to market. How important is this? John Logie Baird, the Scotsman who invented the television, died in rented accommodation in Dundee years after he was bought out by EMI. Marconi discovered radio and he was bought out by GEC. The only person who had enough sense, education, experience and readiness to keep his patent while allowing people to invest in it is the man to whom Senator Quinn referred as the richest man in the world. Bill Gates is the only person who did not sell. James Watt had to sell two thirds of his patent to secure further investment as his developed his idea and he was not allowed to patent it in his own name. These are examples on a grand scale of the importance of what the Minister of State is doing in the legislation, which recognises the World Trade Organisation’s efforts to deal with issues globally while filling the gaps in legislation dealing with translation, transnational and Third World issues.

When the Patents (Amendment) Act was put on the Statute Book in 1992, Ministers, ICTU and IBEC were saying graduates were needed to engage in research and development. The Minister of State should recognise and highlight this at every opportunity. However, this is no more because we need people to engage in doctoral research. I spoke to a constituent of the Minister of State’s earlier this week. He did his degree in Cork and did his doctorate in California. He conducted post-doctoral research before returning to Cork where he is being helped by the incubation centre in the institute of technology. He has developed an important system relating to sonic waves. He has established a world leading company in County Cork as a result of doctoral research. James Watt invented the steam engine, did not patent his idea and lost out. Baird invented the television, which can be found in very house in the world, died in rented accom[1931]modation and suffered a loss of reputation and money. Marconi did better because he held on to a number of his patents and he was supported by the Pope and others. However, the principle is the same. Intellectual property rights need to be protected. People who have good ideas to improve our quality of life and services should be able to patent and protect them. We do not want young people engaging in pre-Industrial Revolution type work in companies such as Fruit of the Loom nor do we want Irish industry to be based on out-of-time patents. Ireland should be leading, not following in this area, and that is why I welcome the legislation.

  Mr. Hanafin: A balance must be struck with patents. There is the risk and reward necessary for people who will undertake long, difficult and arduous tasks in an effort to create something for the benefit of all. For example, Edison made 4,000 attempts to come up with the rubber formula. When he was asked whether his effort was a waste of time and money, he replied it was not, that he had found 4,000 ways that were not successful and that he would find the one that was. He did subsequently and the same happened with electricity. The risk and reward was balanced.

In Ireland, the pharmaceutical, ICT and intellectual property markets are important, strong and expanding and I hope that continues. When we discuss patents, we should consider the perspective of generic drugs that might be developed to save lives in the Third World. I am glad to note there are three permissible exemptions to the basic rule on patentability, which is an important element of the Bill. First, inventions, the commercial exploitation of which would be contrary to public order or morality, may be exempted. Second, inventions concerning diagnostic, therapeutic and surgical methods for the treatment of humans or animals may be exempted. Third, member countries may exclude from patentability plants and animals other than micro-organisms and essential biological processes for the production of plants and animals other than non-biological and microbiological processes.

An important distinction can be made between what the EU and US are doing in this area. If somebody were to develop a product, which hopefully will happen bearing in mind the green revolution in the 1960s, whereby two ears of corn or wheat would grown where currently only one grows, that would be to the benefit of humanity. Similarly those who are protected by patent should consider those in the Third World whose lives can be saved and put in place provision for those countries who cannot afford to pay the high cost of drugs, notwithstanding the fact that the reward and risk must be balanced.

I am conscious that the human genome should not be patentable in any way in future. Some gen[1932]etic engineering is frightening to everybody. There is genetic engineering, about which people talk, in so-called Frankenfoods and genetic engineering for cosmetic purposes. However, there is also genetic engineering which could be beneficial to humanity and this must be free of patent. Notwithstanding the fact that patents and the use of them are beneficial for this country, there is great benefit in regularising and ensuring that the European standard is maintained.

This is a relatively short and uncontentious Bill. Ireland’s membership of the World Trade Organisation gives rise to the main elements of the Bill. The amendments are included either as a consequence of our status as a contracting party to the European Patent Convention or because of the need to clarify and correct inaccurate wording in two sections of the 1992 Act.

The granting of patents for new inventions to secure to the inventor the exclusive right to exploit the invention for a limited period is a long established and well known instrument of promoting technical innovation and industrial development. After the Industrial Revolution and from the 19th century onwards, all industrialised countries established their own patent system tailored to each country’s industrial strategy. The desirability of some international harmonisation of patents was recognised as far back as the 19th century.

The first international convention for the protection of industrial property, the so-called Paris Convention, was signed in 1883. This convention has been revised several times since then and now 157 countries, including this State, are party to it. Under this convention, member countries must provide equal and reciprocal treatment in patent matters for nationals of other member countries and recognise the priority date of an application filed up to 12 months earlier in another member country. The convention also stipulates the condition under which a country can grant a compulsory licence if a foreign owned patent is not being worked in its territory.

A further landmark in international development was the Patent Co-operation Treaty concluded in Washington in 1970 which came into force in 1978. The main objective of the treaty was to streamline patent application filing and novelty search procedures for applicants wishing to obtain patent protection in several countries belonging to the treaty. The treaty was not concerned with the establishment of an international patent but with an international procedure for sharing the work on processing patent applications in patent offices.

In Europe, efforts to create a common patent system resulted in the establishment of the European Patent Convention, EPC, in Munich in 1973. That convention established a European Patent Office in Munich whose function is to grant, on the basis of one central application to that office, [1933]in any of its official languages, namely, English, French or German, patents which would be valid in each contracting state designated by the applicant.

In effect, a bundle of national patents emerge from a European patent application and in each designated country the European patent has the same legal effect as one granted by the local national patents office. European patents are granted only after an in-depth examination following a comprehensive novelty search in a collection of several million documents and, therefore, offer a high level of legal certainty. The EPC is not limited in its membership to EU countries and includes such non-member states of the EU as Monaco, Switzerland and Liechtenstein. Most EPC contracting states have brought their national patent laws into line with the EPC.

Industry today operates internationally to a greater extent than it did when the European Patent Convention was established in 1970s. There can be little doubt about the desirability of and need for much more international agreement on patents. In 1993 a major step was taken towards worldwide harmonisation of legislative and regulatory practices with the Agreement on Trade Related Aspects of Intellectual Property Rights, or the TRIPs Agreement, negotiated under the General Agreement on Tariffs and Trade, GATT. The TRIPs Agreement is an annexe to the agreement establishing the World Trade Organisation, the WTO, and compliance with the TRIPs Agreement is an essential requirement under the new world trading order. The TRIPs Agreement, which came into effect on 1 January 1995, covers all area of intellectual property rights, including patents.

The main objective of the TRIPs Agreement, as contained in its preamble, is to reduce distortion and impediments to international trade by promoting effective and adequate protection of intellectual property rights and by ensuring that measures and procedures to enforce intellectual property rights do not in themselves create barriers to legitimate trade. Article 7 of the agreement, entitled Objectives, provides that the protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology to the mutual advantage of producers and users of technological knowledge in a manner conducive to social and economic welfare and to a balance of rights and obligations. To achieve these objectives, the agreement sets out the minimum standards of protection to be provided by each member country.

There are many technical amendments to the Bill which are necessary, notwithstanding that within the House there is agreement on it. The Bill is uncontentious and I commend it to the House.

[1934]  Mr. McDowell: It is the first refuge of an Opposition spokesperson on a Bill such as this one to complain about the delay in its introduction. However, even by the standards of this and the other House, the delay of seven or eights years in progressing the Bill to this stage requires some explanation. I invite the Minister of State to share his thoughts on that subject when he replies.

I checked the website of the Patents Office yesterday and noted it is quite a good one. Among the information it contains is a list of recent applications for patents, of which I will list a number. During September, applications for patents were made for a security access control assembly unit, an apparatus for facilitating the collection of waste, a hand-washing system and an apparatus for the collection of solar energy. Thus, there is a wide variety of applications. It is good to note there are such applications because research and development innovation is vital in our economy.

However, there is another side to the story. I am glad Senator Hanafin, uniquely among the speakers who contributed thus far, mentioned it in the more nuanced beginning to his contribution. It is in our interests to protect the interests of inventors and those who have ideas. If we do not do that, big companies will not spend time, money and effort in exploiting an idea or carrying out research and development, the findings of which others can simply take and use. Therefore we must protect that aspect.

However, our greater interest as a society must be to ensure that good ideas are exploited for the benefit of society. We cannot stand over a position which has happened and will happen again whereby companies, perhaps large ones, will simply patent every idea that crosses their thresholds not with a view to exploiting those ideas down the road but with a view to preventing others from doing so. It is important we strike a proper balance not only in the Bill, because legislation is only one aspect of it, but in the way we operate the patent system. We must strike a balance between encouraging invention, innovation, ideas and trade and in protecting inventors. We cannot stand over a situation where the patents system is used and abused by multinational corporations to prevent trade, which does happen.

It is important to reiterate the point made by Senator Hanafin when he spoke about inventions that are vital for the proper functioning of society. Drugs are by far and away the most important example in this respect. It is important that pharmaceutical companies have sufficient incentive to conduct millions of euro worth of research. If the incentive does not exist they will not do it and invention and innovation will be delayed as a result. Equally, one has to wonder whether we really want to have the market in incredibly important drugs tied up for 20 years and left to be exploited, perhaps exclusively, by [1935]one American multinational corporation. Is it morally and politically sustainable or right that, having invented a particular drug, a multinational corporation has 20 years in which to exploit it to the maximum of its commercial advantage? I agree with Senator Hanafin that it is clearly in the interests of society that research information and knowledge is exploited as broadly as possible. I accept we cannot tell pharmaceutical companies that once they have invented a drug, anybody who wishes is entitled to copy it. However, there is a requirement for nuance and balance, which I accept can be imposed at a multinational level only under the auspices of the European Patent Office or the World Trade Organisation.

While I agree with much of what Senators Quinn and O’Toole have said, I suggest they should also examine the other side of the argument, which has not been sufficiently ventilated today. That argument is most powerfully put in the major debate of recent years concerning software. I read some contributions to that debate last night and I assure Senator Leyden, it did not keep me awake. Most of the debate has been between the European Commission and the European Parliament. It is a fascinating debate and one on which literally billions of euro and thousands of jobs potentially turn. It would be naive to say we can allow ourselves to indulge in this argument from an intellectual point of view. The interests of Ireland incorporated are inextricably linked with the multinational corporations which employ thousands of people in the IT sector. The view of our MEPs and Government always has been that whatever Microsoft or other large multinational IT corporations want, they get.

However, I am still attracted by the counter argument, almost idealistic in nature, which suggests that software, ideas, the Internet and the exchange of information and everything connected with that, are so vital to the functioning of modern societies that they should not be patentable at all or, at the very least, there should be serious restrictions on the extent to which they are patented. Again, it is a matter of striking a balance. The European Parliament voted earlier this month to attempt to strike a balance. Having read the resolution that was passed, it appears some further negotiation between the office of Mr. McCreevy, the Commissioner for Internal Market and Services, and the Parliament is required. I hope they have got the balance right. I tend, at least on an intellectual basis, to agree with those who refer to shared human facilities and shared knowledge and who argue that it runs contrary to the original concept underlying the Internet to restrict the availability of software.

Senator O’Toole pointed out that Mr. Bill Gates has made billions of euro and dollars and is now the richest man in the world. Fair play to [1936]him but that is not our interest. Our interest is in having software as freely available as possible, throughout the entire world and not just in the developed world. It is not in making Mr. Gates incredibly rich, although in fairness to Mr. Gates, he is more philanthropic than most.

  Ms White: He gives away a lot of his money.

  Mr. McDowell: Exactly. He is generous with his money and more philanthropic than most. I am not criticising him personally but the interest of Governments and those who have a say in designing the way in which we do these things is not to make Mr. Gates incredibly rich. Our interest is in ensuring his company’s products are produced and disseminated as widely and inexpensively as possible because they are essential for the functioning of any modern society.

I noted when researching this issue last night that the number of Irish applications for patents appears to have reduced in recent years. I am not sure why that is so although I appreciate the EPO deals with a number of pan-European patents, which may be an explanation. The latest figures available are for 2004 and perhaps the trend has reversed since then. However, it appears to run contrary to what the Government has been asserting recently about stimulating research and development.

I wish to make a number of points about the taxation framework which have not been mentioned thus far but which are important. In the Finance Act of 2004, stamp duty which was previously payable at 9% on the transfer of intellectual property, broadly defined, was abolished. The intention was to stimulate research and development in Ireland but I am not persuaded it has had that effect. Evidence suggests that the abolition of the stamp duty has been used and exploited by non-Irish based firms to transfer royalties and intellectual property in Ireland, with a view to reducing their tax liabilities in other jurisdictions. While I accept it is in our interest to encourage research and development in this country, we should not, even as a side effect of our actions, create a tax loophole or haven for companies which are not bringing an enormous amount of added value to this country. I would welcome the Minister’s reflections on this matter. The exemption was introduced only a few years ago but I hope the Minister can assure us it is having the effect he intended, rather than the unintended effect of creating a tax haven for companies that do not add value here.

In 2004 the Minister also introduced a series of measures intended to stimulate research and development. A 20% tax cut is now available for additional work done in this country. It was asserted at that time that the Department would introduce regulations specifying what constituted additional research and development. I am not [1937]sure whether those regulations have been introduced or are sufficiently robust to ensure it is actually added value. It is important that it should be and that we are not simply allowing large companies to discount a certain amount of their tax liability if they are not doing anything which they would not be doing already. The intention of the tax reduction was to stimulate additional work. It is important we are vigilant in ensuring the purpose of that tax change is followed through on and we do obtain added value for the money.

The core of the Bill concerns compulsory licences. On balance, we have probably got it right and I appreciate that much of it repeats what is contained in the TRIPS Agreement. It is an enormously important element of the Bill. It is vital that we are in a position to provide compulsory licences and that people can obtain them in circumstances where patents are not being exploited. We cannot stand over a situation where companies sit on patents to ensure somebody else does not exploit them. The provision dates back to 1992, to the principal Act to which Senator Leyden referred earlier. I am interested in how it functions. I have read the Act but am not clear on, for example, the number of compulsory licences that are typically issued by the controller in any given year. Is the provision a threat or is it something that actively happens in practice?

With regard to the WTO, Senator Quinn’s points about respecting intellectual property are correct. However, it would be naive not to be aware of the fact and accept that in many countries, such respect does not exist. While we may be conscious of our obligations, many countries — some of which produce products which are dumped here — simply do not respect patents, regardless of whether they have signed up to the WTO agreements. We must be robust in insisting that we respect intellectual property rights in order that others will do likewise.

Much of the Bill is technical in nature. I am somewhat bemused by the provisions on translation and do not see why such issues should take up our time these days. Surely, at a time when most commerce is done through English, German or French, patents in those languages should be acceptable throughout the European Union. I look forward to debating that issue further. In summary, this is a more nuanced issue than it first appears.

  Ms White: I welcome the Minister of State and his staff and congratulate him on bringing this Bill towards its conclusion. I know from my own experience as a businessperson how important innovation and creativity are. No business can grow, and never could grow, unless the drivers of the business were innovative and came up with new ideas. I know from my 16 years with our business, where we work 24 hours a day, seven [1938]days a week, that we were very protective and quite neurotic about protecting the recipes we had for our particular product. We spent years adding creativity and innovation to our product, and we now employ 130 people. We would not have done so without innovation and creativity. At times, we ran into people copying what we did. I know how important the need for patent legislation, and updating the legislation, is.

I had personal pleasure in being part of the intellectual property issue. Before his last budget as Minister for Finance, I meet with the former Deputy, Charlie McCreevy, to ask him to remove the stamp duty on intellectual property. I was delighted he did so. I have a sense of personal achievement in that I have added to this.

Other contributors spoke about products and the contribution to the economy of the international companies here. For example, Apple and its chief executive officer, Steve Jobs, have brought the Macintosh computer into our homes, in contrast to the mainframes that existed. They made computers accessible to human beings, and the company has repeated the feat with its iPod.

People can have a gift for creativity. I am revising my child care document at the moment and I am struggling to add creativity to it. It must be creative, and there is no point in just having a mundane report or proposal. As a businessperson there is a struggle within me to be creative all the time.

I congratulate the Minister of State, and I thank him again.

  Mr. M. Ahern: I thank all the Senators who have taken part in the debate. It is a very important issue and people have realised that. A number of aspects referred to by Senators stand out. To encapsulate these issues in a sentence, we are talking about the need for education, enforcement, protection of intellectual property rights, further investment in research and development and commercialisation.

These are areas which have been recognised, and all parties have recognised that the future for our country is in the knowledge-based area. To get value and ensure we will be successful in future, the sentiments expressed must be acted upon. The Government realises this and is in the process of acting.

Certain concerns have been raised. Senator Coghlan and Senator Hanafin spoke about the patenting of the human genome. The human body cannot be protected in this way, nor can the simple discovery of one of its elements, such as a sequence or partial sequence of a gene. Discoveries such as DNA or raw human genome information cannot be patented because they are discoveries, not inventions.

[1939]Senator Leyden raised the need for a referendum to accede to the European Patent Convention. This is not the case. The Senator likes a certain pronunciation of the word “patent.” A referendum was held in 1992 to allow Ireland to accede to the Community Patent Convention, but that convention never entered into force. A Community patent regulation was proposed by the European Commission in 2000, but unfortunately that has become deadlocked in negotiations owing to issues of translations of patent claims. Following a consultation process earlier this year, the Commission is to bring forward a communication later in the year to advance the matter.

I take note of the points raised by Senator McDowell regarding taxation. He will be aware that the tax arrangements will encourage research and development. It is a matter for the Minister for Finance. I also note Senator White’s positive comments.

I do not have figures on the effect of the changes brought about in the taxation area. The matter should be raised with the Minister for Finance to get information on how effective it has been. People have made the point that there should perhaps be further moves in that area.

Senator Leyden also raised the issue of the Patents Office becoming a semi-State company. There are no proposals in this regard. As the Senator will know, the Patents Office has been relocated to Kilkenny. Enterprise Ireland provides assistance to inventors under the intellectual property assistance scheme. The Patents Office provides a number of information resources through its website. The Patents Office users’ council is working well and provides a useful forum for the office's stakeholders.

Senator Quinn raised a question about the imperative of bringing intellectual property into line with our international obligations. The Senator is correct in stating that securing the highest standards of protection internationally is important, if protection is secured in individual countries. The high international standards depend substantially on states like Ireland supporting international law in the area. Ireland now enjoys very high standards of legislative protection with regard to copyright, patents, trademarks and industrial designs. It is well up to and ahead of many international standards. We are determined to keep it that way.

Senator Quinn and others also raised the enforcement of intellectual property law. This will always present problems, if only because unlike land, for example, this type of property is capable of virtually limitless copying with ease. However, we are in no way complacent about this. We have recently taken measures to complete transposition of the EC directive on civil enforcement of IP rights. Consideration of new measures to promote such enforcement on a [1940]criminal level is ongoing in the context of a new proposed EU directive on the subject. The importance of intellectual property law to Ireland is fully appreciated by the Government and it will be supported accordingly.

Senator McDowell raised the issue of pharmaceutical patents and a number of compulsory licences. Patents serve to secure the massive investment needed for research and development. Most importantly, they ensure new technologies can be developed for the benefit of individuals. Development of modern medicines is very expensive and it takes many years to bring a new medicine to market and prove it safe and effective. Without patent protection, there would be very little private investment in research. Furthermore, the public availability of information contained in a patent application promotes scientific progress and innovation. No compulsory licences have been issued in recent years.

Senators Coghlan and McDowell raised the issue of patenting software. The European Patent Convention makes it clear that computer programmes, as such, cannot be patented, and this is reflected in section 9 of the Patents Act 1992. It is important to note that this prohibition does not extend to computer-implemented inventions. These are patentable in certain circumstances where they meet patentability criteria, namely, that they are new, involve an inventive step and are capable of industrial applications.

Senator Hanafin raised the issue of poor countries with public health problems. The Doha declaration recognises that each WTO member has the right to grant compulsory licences and the freedom to determine the grounds on which such licences are granted. It also recognises that WTO members with insufficient or no manufacturing capacity in the pharmaceutical sector could face difficulties in making effective use of compulsory licensing. On 13 August 2003 the WTO General Council adopted a decision on the implementation of paragraph 6 of the Doha declaration on the TRIPs agreement and public health. Subject to certain conditions the decision waives certain obligations concerning the issue of compulsory licences set out in the TRIPs agreement in order to address the needs of WTO members with insufficient manufacturing capacity. The community incorporated the decision into its legal order by Regulation (EC) No. 816/2006. The regulation ensures a legally secure, predictable, effective and sustainable solution for those members of the WTO and other less developed and developing countries which want to use a system to access the affordable medicines they need.

I thank Senators for their contribution to the debate and for raising very interesting questions. I thank them for their support in the passing of this very important legislation, which is vitally [1941]important for the continued growth and development of our economy.

Question put and agreed to.

  An Cathaoirleach: When is it proposed to take Committee Stage?

  Mr. Leyden: On Wednesday, 1 November 2006.

Committee Stage ordered for Wednesday, 1 November 2006.

Sitting suspended at 12.55 p.m. and resumed at 2 p.m.