Speech by Mr. Louis Ng Kok Kwang, MP for Nee Soon GRC at the Second Reading of the Intellectual Property (Dispute Resolution) Bill (Bill No. 17/2019)
Sir, I stand in support of the Intellectual Property (Dispute Resolution) Bill which takes significant steps forward in positioning Singapore as a hub for international IP dispute resolution.
The Bill addresses three broad areas of IP dispute resolution. First, it consolidates the majority of IP proceedings in the High Court. Second, it updates pre and post-grant patent procedures. Third, it clarifies that IP disputes are arbitrable.
I have clarifications and recommendations for each of these three areas.
I would also like to acknowledge and thank the NUS Law Intellectual Property Student Association for their input. I would also like to commend the Ministry of Law for their extensive public consultation process and outreach to stakeholder groups such as IPSA.
Pre-grant third party patent observations
The proposed amendments introduce a formal procedure for submitting pre-grant third-party observations on the patentability of an invention. This move which assists IPOS in evaluating patents at the pre-grants stage will increase the overall quality of registered patents in Singapore.
I would like to raise four points on the procedure for submitting third-party observations.
First, will the Ministry consider allowing third-party observers the option of remaining anonymous and not revealing their identities to the patent applicant and the general public?
This would encourage more third parties to submit observations without any fear of prejudice. The Japan Patent Office and the European Patent Office both permit third-party observations to be filed anonymously.
To address the concern of frivolous observations being anonymously filed, the identity of third-party observers can be known by only IPOS who can take action against parties who abuse the observation process.
Second, will the Ministry consider making the content of third-party observations and the applicant’s response to the third-party observation available for public inspection?
Public inspection could generate healthy debate about the validity of the specific patent, making the grant process more robust. On a broader level, this could increase awareness of the requirements of patent validity as a whole. This would increase the overall quality of registered patents in Singapore.
Under the International Patent System administered by the World Intellectual Property Organization, observations and the applicant’s responses are made available for public inspection.
Third, will the Ministry consider setting out in subsidiary legislation or guidelines the grounds on which pre-grant third-party observations should be based?
While the new Section 32 on pre-grant observations states that third parties are to provide “reasons” for their observations, it does not define the term “reasons”.
In contrast, the new Section 38A on the post-grant process explicitly provides grounds for third parties to request a re-examination of patents.
Setting out a list of possible “reasons” would increase the clarity of third-party submissions.
Japan’s Patent Law prescribes specific grounds for third-party observations at the pre-grant stage, which are similar to the grounds under which patents can be invalidated post-grant.
Likewise, the European Patent Convention specifies that pre-grant third-party observations on patentability must be based on the grounds of novelty, inventive step, clarity, sufficiency of disclosure and amendments that are not allowed.
Fourth, while I understand that the costs for third party observations have not been determined and that accessibility would be the key concern, will the Ministry provide its assurance that costs for doing so will be kept as low as possible?
For instance, the costs could be a nominal administration fee for the processing of their observations.
Keeping the costs low will ensure that third parties keen to submit useful observations are not deterred by the prohibitive costs of doing so.
Arbitrability of IP Disputes
Next, I have two points to raise on the amendments to clarify that IP disputes can be arbitrated in Singapore. My two points relate to the scope of IP disputes that can be arbitrated in Singapore.
First, can the Minister clarify if IP rights found in employment contracts are arbitrable?
It is common practice for employers to insert clauses relating to IP rights in employment contracts.
However, there are some countries that deem employment disputes to be non-arbitrable because they relate to matters of public policy.
Greece is one such country that considers employment disputes to be non-arbitrable. The position in Singapore on arbitrability of employment disputes has not been conclusively settled.
If employment disputes are non-arbitrable, then IP disputes arising from employment contracts may be subject to the exclusive jurisdiction of the Courts.
It would be useful for the Minister to clarify the position on arbitrability of IP disputes arising out of employment contracts.
Second, can the Minister clarify if the arbitral awards for patent validity disputes can serve as a basis for patent registry amendments?
Internationally, countries have taken different positions on this. In the EU, patent infringement issues are arbitrable but patent validity challenges are within the exclusive jurisdiction of State courts and are not arbitrable. On the other end of the spectrum, Switzerland allows arbitral awards to constitute the basis for amendments to its patent registry.
The new Section 52F seems to suggest that patent validity are arbitrable. However, it would be useful for the Minister to further clarify whether it is intended that such arbitration award would only be valid as between parties or whether the award can serve as a basis for patent registry amendment.
Fast track option for IP litigation
Finally, beyond the amendments proposed in the Bill, the Ministry has indicated that it intends to further introduce a fast track for lower value disputes or less well-resource litigants.
I understand that details of this fast track option is still being ironed out and will be fleshed out in subsidiary legislation. I would like to raise some points for clarification and consideration when drafting the subsidiary legislation.
First, the Ministry has proposed a cap of two hearing days for cases on the fast track. Can the Minister clarify how the proposed cap of two hearing days was derived? Will the Ministry be further studying the optimal period for hearing cases on the fast track?
I raise this because the consolidation of disputes in the High Court was motivated by the fact that the Ministry has stated that, “IP disputes often involve myriad technical details that are susceptible to repeated and extensive requests for particulars and discovery”.
With this in mind, it is unclear whether a cap of two hearing days for trial would be realistic for IP disputes.
My second point is on the powers of the trial judge hearing cases on the fast track to order relief. The Ministry has not indicated a position on whether such a trial judge for a fast track case can grant both interim and final relief. This question was also left open in the Final Report of the IP Dispute Resolution Committee.
This is a crucial point that I hope the Ministry will eventually clarify. I would also like to highlight that if fast track judges are unable to make decisions on relief, they may have to pass the case to default track judges. This might lead to more time spent and increased costs if plaintiffs have to bring separate legal proceedings by the plaintiff to obtain the legal remedies sought.
Third, I hope the Ministry will also clarify whether decisions from the fast track are appealable, and if so, how this will interact with the proposed two-day hearing cap.
Sir, I stand in support of this Bill and hope the Ministry can take into consideration my recommendations in further developing the IP dispute resolution landscape in Singapore.
Watch the speech here
Watch the response by MinLaw here