Circuit Layouts Act 1989
Purpose of the Act
The purpose of the Act is to protect plans which show the three-dimensional location of the electronic components of an integrated circuit and to give the owner of the plans certain rights in relation to the plans including the right to make an integrated circuit from the plans (the rights under the Act are discussed further below). The layouts are usually highly complex and the intellectual effort in creating an original layout can be both considerable and valuable. The integrated circuit or "chip", made from the plans, is the key to the operation of all kinds of electronic equipment from heart pacemakers to personal computers.
The Act is based on copyright law principles, but is a separate, sui generis (meaning unique) form of protection from copyright. Importantly, there is no requirement for registration for the granting of rights to the owner of a layout.
History
A legislative scheme of intellectual property protection for the layout-designs (topographies) of integrated circuits (also referred to as "computer chip designs" or semi-conductor chips) was introduced in Australia by the enactment of the Circuit Layouts Act 1989 (the Act). The Act came into effect from 1 October 1990. Prior to the enactment of this legislation, there was no specific legislation in Australia to protect the owners of circuit layouts from the unauthorised copying of their designs.
Member countries of the World Trade Organization Agreement (the WTO Agreement) are required by the Agreement on Trade-Related Aspects of Intellectual Property Rights (the TRIPS Agreement), which forms part of the WTO Agreement, to protect circuit layout-designs in accordance with the provisions of an earlier treaty, the World Intellectual Property Organization (WIPO) Washington Treaty on Intellectual Property in Respect of Integrated Circuits, which was concluded in 1989 and in accordance with Articles 36-38 of the TRIPS Agreement. Australia's obligations have been fulfilled by the Act. Prior to the conclusion of the WTO Agreement, protection was given to semi-conductor chips by a number of other countries, including the United States, Japan and the European Union (formerly the European Community).
Which layouts does the Act protect?
The Act protects "eligible layouts", that is, original circuit layouts made by an Australian citizen, an Australian corporation or first commercially exploited in Australia (section 5). In addition any layout originating from a country declared in the Circuit Layout Regulations will also be an eligible layout given protection by the Act. (Protection of Australian layouts overseas is discussed below).
A circuit layout must be original to attract protection. The Act provides that a circuit layout will not be regarded as original if (section 11):
(a) its making involved no creative contribution by the maker; or
(b) it was commonplace at the time it was made.
The Act also applies to all circuit layouts, whether made before or after the commencement of the Act, but an owner of a layout made before the Act commenced operation cannot bring an action for infringement of his or her rights (section 7). (Infringement is discussed further below).
Who is the owner of the rights granted by the Act?
The person who makes an eligible layout is the first owner of any EL rights in that layout (section 16(1)). However, where a person makes a layout under the terms of his or her employment then the employer will be the owner of any EL rights (section 16(2)).
What are the rights granted by the Act?
The Act grants automatically to the owner of an original circuit layout certain rights in relation to that layout. These rights are described as "EL rights", that is, rights in relation to eligible layouts. The EL rights of an owner are set out in section 17 of the Act. They are to:
(a) copy the layout, directly or indirectly, in a material form;
(b) make an integrated circuit in accordance with the layout (that is, a three-dimensional copy of the layout); and
(c) exploit the layout commercially in Australia.
Commercial exploitation may occur by importation, sale, hire or distribution of a layout or an integrated circuit made according to the layout (sections 8(1) and 8(2)). This includes the case where an integrated circuit is contained within a computer, for example.
For how long is the owner granted rights?
The Act grants the owner EL rights for the duration of the "protection period" (section 5). The period of protection for a layout will depend on whether or not it is commercially exploited. Layouts which are commercially exploited will generally have a longer term of protection.
If a layout is not commercially exploited within ten (10) years from the day on which it was made, it will be protected for ten (10) years from the year in which it was made.
If a layout is commercially exploited within ten (10) years of being made, then it is protected for a further ten (10) years from the year in which the layout was first commercially exploited.
It is intended that the maximum possible protection period be twenty (20) years from the year of making an eligible layout and that there be no "perpetual rights" in relation to layouts. The period of protection is much shorter than that given to materials protected by copyright, which reflects both the industrial utility of circuit layouts and the rapid advances of technology in the integrated circuit industry.
When are the owner's rights infringed?
The rights of an owner to copy the layout and make an integrated circuit in accordance with the layout are infringed if another person does either of those acts without the licence or permission of the owner (sections 19(1) and 19(2)). If another person commercially exploits a layout, if the person knew or ought reasonably to have known that they did not have licence to do so, the rights of the owner will also have been infringed (section 19(3)).
Certain activities will not constitute infringement of the owner's rights. EL rights in a layout are not infringed by:
(a) a person who copies the layout for his or her private use (section 21(1));
(b) copying for research or teaching purposes (section 22);
(c) copying in the process of evaluation or analysis of a layout (section 23); or
(d) uses of layouts for Commonwealth defence or security (section 25).
What remedies can a rights owner pursue for infringement?
A rights owner may enforce his or her rights against an infringer by civil action for infringement claiming an injunction, damages or an account of profits (sections 27(1) and 27(2)). Where there is a flagrant infringement or the infringer has gained some benefit, a court has a discretion to award additional damages (section 27(4)).
A rights owner has six (6) years in which to commence an action for infringement (section 28). Note that owners of layouts made before the commencement of the Act cannot bring an action for infringement (section 7).
What protection do Australian circuit layout owners have overseas?
With the conclusion of the WTO Agreement, member countries are required to protect circuit layouts and, in accordance with the principle of "national treatment", are required to give the same level of protection to foreigners who make or exploit circuit layouts in their country as they do to their own citizens (required by Article 3 of the TRIPS Agreement, which forms part of the WTO Agreement). The TRIPS Agreement gives member countries (apart from developing and least-developed country members for whom special arrangements are provided) up to 1 January 1996 to implement its requirements (Article 65(1) of TRIPS). Information on WTO membership is available on the WTO website at http://www.wto.org
What protection do foreign owners of circuit layouts have in Australia?
Where an original circuit layout is made by a citizen, resident or national of a WTO member country (or is first commercially exploited in such a country), that layout is protected in Australia as if it had been made by an Australian citizen. Citizens, residents and nationals of WTO member countries therefore enjoy the same rights in Australia under the Circuit Layouts Act, as Australian citizens, protected persons or residents. Information on WTO membership is available on the WTO website at http://www.wto.org