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IP contracts – Exemption from Restraint of Trade Provisions Abolished

29

AUG

2019

Summary

With effect from mid September 2019 the long-standing exemption of a range of IP rights from the Competition and Consumer Act 2010 (CC Act) restraint of trade provisions is abolished.

Consequently relevant intellectual property licenses and assignments may need review to avoid being in breach of the change law.

Detail

Section 51 (3) of the CC Act substantively exempted from most of Part IV – Restrictive Trade Practices provisions contract (licenses and assignments) conditions to do with patents, registered designs, copyright certain rights under the Circuit Layouts Act 1989 and trade marks.

That provision is being revised with effect from mid September 2019.

Under section 186 of the Treasury Laws Amendment (2018 Measures No5) Act 2019 that repeal applies both in respect of licenses granted or assignments made and contracts et cetera entered into before or after commencement of the repeal legislation.

The repeal may have particular impact in context of “exclusive dealings” and “anti-competitive” conduct.

Both of these require a purpose, effect or likely effect of is “substantially lessening” competition in a relevant market.

Breach of the provisions of the CC Act can involve maximum penalties of $500,000 for an individual or, for a Corporation $10 million, three times the amount ‘reasonably attributable to” the default or 10% of the corporation’s annual turnover.

Accordingly review of documentation to do with licensing and or assignment of IP rights is recommended to ensure one avoids inadvertent breach of the legislation.

About the Firm

Eakin McCaffery Cox
Address Level 28, 1 Market Street, Sydney, Australia 2000
Tel 61-2-9265 3000
Fax 61-2-9261 5918
Email info@eakin.com.au
Link www.eakin.com.au

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