Application for an order granting a compulsory licence
(1) Subject to subsection (1A), a person may apply to the Federal Court, after the end of the prescribed period, for an order requiring the patentee to grant the applicant a licence to exploit the patented invention (the original invention ).
Note: For compulsory licences for the manufacture and export of patented pharmaceutical inventions to eligible importing countries, see Part 3. However, Part 3 does not prevent a compulsory licence from being ordered under this Part in relation to such an invention (see section 136C).
(1A) A person cannot apply for an order in respect of an innovation patent unless the patent has been certified.
Making an order
(2) After hearing the application, the court may make the order if satisfied that:
(a) all of the conditions in subsection (3) exist; or
(b) the patentee has contravened, or is contravening, Part IV of the Competition and Consumer Act 2010 or an application law (as defined in section 150A of that Act) in connection with the patent.
(3) The conditions in this subsection are:
(a) demand in Australia for the original invention is not being met on reasonable terms; and
(b) authorisation to exploit the original invention is essential to meet that demand; and
(c) the applicant has tried for a reasonable period, but without success, to obtain authority from the patentee to exploit the original invention on reasonable terms and conditions; and
(d) the patentee has given no satisfactory reason for failing to exploit the patent to the extent necessary to meet the demand for the original invention in Australia; and
(e) it is in the public interest to provide the applicant with authorisation to exploit the original invention, having regard to the following:
(i) the benefits to the public from meeting the demand for the original invention;
(ii) the commercial costs and benefits to the patentee and the applicant from providing authorisation to exploit the original invention;
(iii) any other matters the court considers relevant, including matters relating to greater competition and any impact on innovation; and
(f) if the applicant is the patentee of another invention (the dependent invention ) and is seeking the authorisation for the purposes of exploiting the dependent invention:
(i) the dependent invention cannot be exploited by the applicant without exploiting the original invention; and
(ii) the dependent invention involves an important technical advance of considerable economic significance on the original invention.
Form of order
(3A) If the applicant is the patentee of the dependent invention, the order must:
(a) require the patentee to grant to the applicant a licence to exploit the original invention only to the extent necessary to exploit the dependent invention; and
(b) if the patentee so requires--require the applicant to grant to the patentee a licence on reasonable terms to exploit the dependent invention.
(3B) An order must direct that a licence:
(a) is not to give the licensee, or a person authorised by the licensee, the exclusive right to exploit the original invention or the dependent invention (if applicable); and
(b) is to be assignable only in connection with an enterprise or goodwill in connection with which the licence is used.
(3C) An order may direct that a licence is to be granted on any other terms specified in the order that the court thinks fit. Such terms must be consistent with the public interest, having regard to the matters specified in paragraph (3)(e).
Effect of order
(4) An order operates, without prejudice to any other method of enforcement, as if it were embodied in a deed granting a licence and executed by the patentee and all other necessary parties.
(5) The patentee is to be paid in respect of a licence granted to the applicant under an order:
(a) such amount as is agreed between the patentee and the applicant; or
(b) if paragraph (a) does not apply--such amount as is determined by the Federal Court to be just and reasonable, having regard to:
(i) the economic value of the licence; and
(ii) if the order is made because the court is satisfied that the patentee has contravened, or is contravening, Part IV of the Competition and Consumer Act 2010 or an application law (as defined in section 150A of that Act) in connection with the patent--the desirability of discouraging contraventions of that Part or an application law; and
(iii) the right of the patentee to obtain a return on investment commensurate with the regulatory and commercial risks involved in developing the invention; and
(iv) the public interest in ensuring that demand in Australia for the original invention is met on reasonable terms.
Revocation of licence
(6) The patentee or the Federal Court may revoke a licence if:
(a) the patentee and the licensee are agreed, or the court on application made by either party finds, that the circumstances that justified the grant of the licence have ceased to exist and are unlikely to recur; and
(b) the legitimate interests of the licensee are not likely to be adversely affected by the revocation.
(a) the licence is revoked by the Federal Court; and
(b) the order granting the licence required a licence (the cross-licence ) to be granted in accordance with paragraph (3A)(b);
the Federal Court must consider whether to revoke the cross-licence.