Why two is NOT better than one – The problem of amending legislation through other legislation

May 1st, 2012
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By Alison Dyer

In recent years a trend has developed of amending an Act of parliament, not by means of a specific amendment Act, but by an Act covering another area of law. This can lead to unforeseen and unfortunate consequences.

One example is the Patents Act 57 of 1978, which came into force on 1 January 1979. Since then it has been amended, and its interpretation and application have been affected, not only by several specific Patents Amendment Acts and Intellectual Property Laws Amendment Acts, but also, at least, by the Constitution, read with the Renaming of High Courts Act 30 of 2008; the Nuclear Energy Act 46 of 1999; the National Environmental Management: Biodiversity Act 10 of 2004; the Intellectual Property Rights from Publicly Financed Research and Development Act 51 of 2008; and the Companies Act 71 of 2008.

In certain circumstances it is clearly desirable to promulgate one Act that has the effect of amending a multitude of other Acts, as individual amendment of the multitude of Acts would be unwieldy and time consuming. An example of this is the Constitution read with the Renaming of High Courts Act, which had the effect, inter alia, of changing the name of the Appellate Division of the Supreme Court of South Africa to the Supreme Court of Appeal, and the conversion of a provincial or local division of the Supreme Court of South Africa to a High Court, and the renaming of such High Courts.

In other circumstances the use of an unrelated Act to amend the Patents Act or to affect its interpretation is less suitable and can lead to real problems.

One example of this is the Nuclear Energy Act. It would not at first be obvious to a lawyer looking at a patent law question that an Act intended to regulate the nuclear energy industry in South Africa would have been used to amend the Patents Act.

However, by virtue of the Nuclear Energy Act, s 36 of the Patents Act was amended to provide that the Registrar of Patents must take various steps in relation to any patent application that relates to the production or use of nuclear energy or to the production, processing or use of nuclear material or restricted matter as defined in the Nuclear Energy Act where the invention might be used for a purpose or in a manner that would be harmful to, or endanger the security of, South Africa, or that is not permissible in terms of the Nuclear Non-Proliferation Treaty or the Safeguards Agreement, and the like.

A second example is the National Environmental Management: Biodiversity Act (NEMB Act).

After the passing of the NEMB Act, the Patents Amendment Act 20 of 2005 was passed to amend the Patents Act to provide that before any complete patent application can be accepted, there must be lodged with the registrar a statement stating whether or not the invention for which protection is claimed is based on or derived from an indigenous biological resource, genetic resource or traditional knowledge or use. In addition, if the statement is in the affirmative, the applicant for the patent must also furnish proof of his title or authority to make use of the indigenous biological resource or the like.

There are various potential problems here. Firstly, while the terms ‘genetic resource’, ‘indigenous biological resource’, ‘traditional knowledge’ and ‘traditional use’ are defined in the Patents Act, to understand these definitions one needs to refer to the NEMB Act, although there is no indication of this in the Patents Act.

Further, the types of proof acceptable to the registrar are set out in the regulations to the Patents Act and are based on various provisions of the NEMB Act. For example, one of the types of proof that is acceptable to the registrar is proof of a material transfer agreement as contemplated in s 82(2)(b)(i) of the NEMB Act. It is likely that in the future amendments will be made to the NEMB Act. It may, however, not be realised that such amendments could impact on the Patents Act and regulations, particularly as the two Acts are administered by different government departments. This could result in either amendments being made to the NEMB Act that potentially conflict with provisions of the Patents Act, or that amendments made to the NEMB Act are not carried through to the Patents Act and regulations. For example, if an amendment is made to s 82 of the NEMB Act, which deals with material transfer agreements, this may well require an amendment to the patent regulations in relation to the type of proof acceptable to the registrar, but will this be remembered?

In case the above seems unduly speculative, the last example to be dealt with illustrates the type of problem that can arise.

The Companies Act 71 of 2008, which came into force on 1 May 2011, establishes the Companies and Intellectual Property Commission. This commission is headed by a commissioner appointed in terms of s 189 of the Companies Act. In terms of this section, the commissioner is responsible for all matters pertaining to the functions of the commission. These powers and responsibilities include full responsibility for the Patent Office, including registration of intellectual property rights in accordance with relevant legislation.

In addition, sch 3 of the Companies Act amends the Patents Act to introduce a definition of the ‘commission’, to provide that the ‘Patent Office’ means ‘the office of the commission’, and to provide that the ‘Registrar of Patents’ means the ‘commissioner’, although no definition of the ‘commissioner’ is inserted.

On the surface, this all seems fine. However, the Patents Act already has a commissioner. Section 2 provides that ‘the commissioner’ means ‘a Commissioner of Patents designated in terms of section 8’. Section 8 provides that there shall be designated a judge of the High Court to act as Commissioner of Patents to exercise the powers and perform the duties conferred or imposed on the commissioner by the Act. Further, in terms of s 18 of the Patents Act, no tribunal other than the commissioner shall have jurisdiction in the first instance to hear and decide any proceedings, other than criminal proceedings, relating to any matter under the Patents Act.

So now the Patents Act has two commissioners with very different functions. Unfortunately, in several sections of the Patents Act reference is simply made to ‘the commissioner’, not the commissioner of the commission or the Commissioner of Patents. While the context and historical background can be used to determine which one is being referred to, it nevertheless remains that ambiguities have been introduced into the Patents Act.

A specific example of this is s 51(10) of the Patents Act, which provides that any amendment of a patent application or patent made in conflict with the provisions of s 51, other than an amendment allowed by the commissioner, may be set aside by the commissioner at any time on application made to him.

Prior to promulgation of the Companies Act, it was clear that the commissioner referred to was the Commissioner of Patents. However, it can now be argued that the commissioner referred to is the commissioner of the commission, which in turn means the old registrar. As all amendments are either allowed or refused by the registrar, this section can be interpreted to mean that no allowed amendment can now be challenged. This is completely contrary to the intention of this subsection, which is to allow amendments that have been allowed by the registrar to be challenged before the Commissioner of Patents.

While the law on the interpretation of statutes may mitigate against the interpretation set out above, it remains the case that ambiguities have been introduced into what was previously a perfectly clear provision.

This could have been avoided if the Patents Act had been amended by a specific Patents Amendment Act, where one trusts the drafters would have had regard to the existing Act in formulating the amendments. The problem outlined above could easily be solved by inserting into the Patents Act a definition of the ‘commissioner of the commission’ and then amending each section of the Patents Act where the word ‘commissioner’ appears to replace the word with either the ‘commissioner of the commission’ or the ‘Commissioner of Patents’ as appropriate.

To conclude, it is clear from the above that it can be undesirable to amend Acts relating to a particular area of law by means of other Acts that cover unrelated sections of the law.

Alison Dyer BSc (Hons) (Chem) LLB (UKZN) is a patent consultant to Spoor & Fisher.

This article was first published in De Rebus in 2012 (May) DR 34.