Trends in Protection on the Edge of the World: News From the Land of the Long White Cloud

In this article we provide a short snapshot of the New Zealand intellectual property (IP) protection scene as it stands today, as well as some upcoming changes.

With a population of just 4.3 million and a remote geographic location, New Zealand (NZ) may often get overlooked when considering a patent or trademark filing strategy.  But did you know that New Zealand is one of the easiest countries in which to do business, and the easiest place in the world to start a business, according to The World Bank (Doing Business report)?  New Zealand was the first to launch an online company registration system back in 1996 and it’s been mandatory since 1998.  Our labor market is flexible and deregulated, with a highly educated and multi-skilled workforce, we have sophisticated telecommunications links and excellent export networks.  We also have low-expense and low-bureaucracy patent and trademark systems compared to those in place elsewhere in the world and the low NZ dollar makes filing for IP protection here even more favorable.

Key trading partners include Australia, the United States, Japan, China and the United Kingdom.  As a Commonwealth country, our IP law tends to follow closely that of the United Kingdom and Australia, particularly around legislation and case law.  NZ applies similar interpretation on IP law as these trading partners but processing is usually 3-5 times faster and often as much as 10 times cheaper.

New Zealand’s largest industries include agriculture, manufacturing, food & beverage and tourism and it is these industries where the greatest IP generation occurs.  Our most well recognized brands and exports include the All Blacks national rugby team, Peter Jackson’s Lord of the Rings trilogy, Pumpkin Patch children’s clothing, Anchor dairy products and New Zealand lamb.   We have a big focus on primary industries and related innovations, with high efficiency farming including some 45 million sheep (that’s more than 4 sheep per capita), as well as dairy cows, cattle generally, a thriving horticulture industry free of many pests and a large coastline and fishery catchment. Innovators overseas with new products that have applications in the primary industries are well advised to make the small investment in IP protection in NZ given the potentially significant returns.

In New Zealand, patents (equivalent to utility patents in the USA), registered designs (viz. US design patent) and trademarks are subject to normal substantive examination processes.  Fortunately, due to smaller backlogs and a less bureaucratic system, overseas applications filed into NZ are often examined within a year of filing.  Accelerated examination may also be requested with no official fee where applicants need a quicker indication as to the validity of their rights. Further, if you have a corresponding patent right granted in another major patent office, the NZ process can be accelerated assuming the NZ claims are similar to that in the corresponding right.

The pace of change in NZ IP law is a mixed bag with some forward thinking ‘new’ laws relating to trademarks and copyright.  The same can’t be said for patents and designs with the current Acts dated from 1953.  Case law has been relied on since then to interpret changes in technology, however both Acts are due for overhaul.

A new Patents Bill has been in gestation for several years now updating patent law to be closer to related UK and Australian law.  The Bill arguably makes it harder for a patent applicant to obtain rights but the rights gained should have a greater degree of validity than rights for patents under the existing Act.

One particular issue has raised considerable debate here as elsewhere: the protection of software and business methods.  On first reading the Bill proposed to allow patents to computer software – surprising because of the fact that European legislation, which NZ tends to follow, appeared to be going the other way.  However Minister of Commerce Simon Power issued an update in July 2010 reversing the position and excluding all software (other than embedded software) from patent protection.  This was based on the many submissions opposing the granting of patents for computer programs on the grounds it would stifle innovation and restrict competition.  Instead the Intellectual Property Office of New Zealand (IPONZ) has been charged with formulating guidelines for software once the bill has passed.  Guidelines have recently been released for debate largely preventing protection of software unless the software is dependent on some reduction to practice or real life experience or influence.  The debate will no doubt continue.

A further peculiarity to the NZ patent situation is that of how to address IP rights in respect of traditional or Maori rights.  Maori are the indigenous population of New Zealand and have a wealth of traditional knowledge.  New Zealand (“Aotearoa” in Maori) has a strong record in recognizing and embracing indigenous rights – although is far from perfect, as it requires balancing the views of many different stakeholders.  Integrating traditional rights into modern NZ patent law is harder than might be expected given key differences in the way IP is handled between European culture and Maori culture.  For example, Maori IP is owned by the “iwi” or tribe and is handed down orally between generations.  The European system by contrast is centered on awarding individuals (inventors) rather than a group, and is based on a written, published process with a limited time period for the right.  Arriving at a compromise between these diametrically opposed views is certainly a challenge.

Even with proposed changes to the legislation, New Zealand is likely to remain one of the cheapest and easiest countries in which to obtain IP rights including patents, designs and trademarks.  This is partly due to a low exchange rate relative to other countries but also to local Government wanting to encourage innovation in New Zealand as well as the injection of foreign investment and expertise.

The speed of turnaround (possibly as short as 15 days for selected actions) is also unlikely to change and is helpful as companies can obtain an early indication as to the validity of their IP in a low expense test bed.  The low expense also means that NZ can be the test country for litigation, again costing less to pursue in NZ than elsewhere.


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