Introduction to Intellectual Property

This chapter will explain what intellectual property law is, the areas of law, the rationale for intellectual property law and and the international context.

Intellectual property is the title given to a class of exclusive rights over intangible creations. There are a variety of different areas of law within intellectual property law with the most common being copyright, trade marks, industrial designs and patent law. There are also sui generis laws, which include rights such as plant breeders rights, design circuits and geographical indicators.

Intellectual Property Area Rights Source of Law in Australia
Copyright to reproduce, copy, publish and make available expression Copyright Act 1968 (Cth)
Trade marks to use words, signs, symbols, sounds and smells to identify your goods and services in trade Trade Marks Act 1995 (Cth)
Patents to commercially exploit an invention Patent Act 1990 (Cth)
Design to apply a shape or pattern to a creation Design Act 2003 (Cth)

Video overview by Nic Suzor onIntellectual Property Law

Intellectual property law, particularly copyright law, is thought to have a predominantly instrumental function: it provides creators of new work (whether it is inventors of patents or authors and publishers alike), with certain incentives in order to encourage the creation of new expression. It does this by granting creators control over certain uses of their creations for certain periods of time, limiting who may exploit, or make use of the creations. Each specific area of intellectual property law conferred exclusive rights to the creator or owner. The exclusive rights vary between the types of intellectual property law, however, the concept of exclusive use of the creations remains the same.

There are several views concerning the purpose of intellectual property law. One view is that intellectual property encourages creativity and innovation by allowing creators to profit from their work. This view is most notable in the area of copyright and is reflected in the wording of many copyright laws. For example, the “Copyright Clause” of the United States Constitution states that Congress may grant authors copyright protection for their works for a limited time in order to “promote the progress of science and useful arts.” 1) Similarly, the stated purpose of the Statute of Anne, the first copyright statute in England, was to “encourage learning.” 2) Another view is that intellectual property law ensures that creators are paid fairly for their effort. A third view suggests that a creative work is an expression of the personality of its creator and should be protected from being used without the creator's permission.

Although intellectual property law grants creators many exclusive rights, it also limits these rights in many important ways. Most of these limitations are quite specific, but a few are broad. These limits are important in order to ensure that law is balanced - that the monopoly granted by intellectual property's exclusive rights does not place excessive limitations on the public's freedom to learn, express themselves and build upon existing cultural works.

The Economic (Utilitarian) Justification

The most common justifications for intellectual property is the utilitarian justification. According to the US Constitution, intellectual property law exists, “[t]o promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.“ 3)

Video overview ofThe utilitarian justification for Intellectual Property

The utilitarian view starts from the position that expression is a “public good” and that creators therefore cannot prevent others from using their expression without legal intervention. This idea is supported by the unique “non-rival” nature of expression as a intangible good - that is - one person's use does not diminish or interfere with the use by another. However, the inability to exclude others may present problems for creators and the production of public goods. If a creator of a public good is unable to exclude others from using it, she or he will be unlikely to recoup the time and/or monetary investment in creating it. This may cause creators, or those funding creation such as publishers, record labels or movie studios to stop spending resources on cultural production because they cannot profit from it. Intellectual property seeks to prevent this from happening by making expression excludable in order to allow producers to commercialise their creations and recover their costs. Intellectual property law does this by providing a set of “exclusive rights” to creators and inventors.

In order to make the production of public goods more profitable, intellectual property makes access more expensive. The law must then strike a delicate balance between encouraging the creation and dissemination of works by providing incentives and recognising the public interest in greater access to expression. The law must also recognise the needs of future authors that often build upon the past expression. Because of this the stronger intellectual property protection is, the more expensive future production becomes.

Video overview ofThe IP Balance

The Natural Rights Justification

While the natural rights view is not explicitly recognised and often even disclaimed, intellectual property is also supported by a justification that authors deserve property rights in their expression. This view is based in a Lockean argument that authors deserve property in the fruits of their labour. However this view has been challenged strongly by prominent figures such as Thomas Jefferson:

"If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of every one, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature."

Or Benjamin Kaplan:

"[I]f man has any 'natural' rights, not the least must be a right to imitate his fellows, and thus to reap where he has not sown."

Intellectual property law has been relatively harmonised worldwide. There are a number of agreements regarding intellectual property law in general, and more specific agreements that apply to certain areas of intellectual property. The World Intellectual Property Organisation (WIPO) is an international agency, established in 1967 which administers treaties such as the Paris Convention on the Protection of Industrial Property 1883 and the Berne Convention for the Protection of Literary and Artistic Works 1886, WIPO Performances and Phonograms Treaty and WIPO Copyright Treaty. It is WIPO's obligation to administer intellectual property matters and there are approximately 22 intellectual property treaties under its administration. Whilst WIPO administers the treaties, it does not have the requisite power to ensure compliance of the treaties. As a result of this, the World Trade Organisation Agreement was enacted, specifically the part that deals with intellectual property, the Trade Related Aspects of Intellectual Property Rights 1994 (TRIPS).

TRIPS is an international agreement which identifies 5 minimum standards for intellectual property that all members of the WTO must adhere to. Further, each WTO member is required by TRIPS to enforce these standards.

There are also a number of bilateral intellectual property law agreements. These agreements are often entered into to ensure that the countries who deal in trade together have similar or compatible intellectual property laws. Some of the most notable trade agreements are:

  • Australia-United States Free Trade Agreement (AUSFTA)
  • Korea-Australia Free Trade Agreement (KAFTA)
  • Japan-Australia Economic Partnership Agreement (JAEPA)
  • China-Australia Free Trade Agreement (CHAFTA)
  • Anti-Counterfeiting Trade Agreement (ACTA)
  • Trans-Pacific Partnership (TPP)
  • Trans-Atlantic Trade and Investment Partnership (TTIP)
  • Trade in Services Agreement (TISA)

One controversial aspect of trade agreements is the use of investor-state dispute settlement (ISDS) clauses. In the case of many treaties, if there is a dispute between the parties, TRIPS can be used to enforce the standards of trade. However in instances where an ISDS is included in contracts, individual investors can bring arbitration proceeding against a nation. This process can be very costly and may involve significant delay.

US Constitution, Article 1, Section 8, Clause 8.
8 Anne Chapter 19 (1710)
Article I, Section 8, Clause 8, of the United States Constitution
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