Dave A Wyatt and Azlina Aisyah Khalid of Henry Goh & Co look in to strong indications that Malaysia will accede early to the Madrid Protocol, and also give an overview of recent IP developments in the country
The Madrid System for the International Registration of Marks was
established under the Madrid Agreement in 1891. Administered by the
International Bureau of WIPO in Geneva, Switzerland, the system offers a
simple, cost effective alternative to obtaining trade mark
registrations in other countries via what are known as direct national
In recent decades, as the world's technologies have advanced in leaps
and bounds, the intellectual property system has never faced a greater
challenge in preserving exclusive rights to owners for their
intellectual creations. Insofar as trade mark rights are concerned,
brand and trade mark owners have always been confronted and perplexed by
the numerous trade mark practices that vary from country to country.
Trade mark rights have always been territorial in nature but with the
fast paced globalisation of the world, it was obvious that the process
of trade mark registration ought to be made easier for trade mark owners
wherever they may be.
Enter the Madrid Protocol. The Protocol was introduced almost 100
years after the Madrid Agreement and with it, came new features which
removed the difficulties that were inherent in the Madrid Agreement. The
Protocol has been in force since April 1 1996.
Coming back to Malaysia, in a national seminar on the Madrid Protocol
jointly organised by the Ministry of Domestic Trade, Co-Operatives and
Consumerism, the Malaysian Intellectual Property Office (MyIPO) and WIPO
on October 17 and 18 2011, there were strong indications that the
Government would accede by 2013, ahead of its 2015 obligation under the
ASEAN Economic Community.
Nevertheless, there is a lot of work required before that can be
achieved. For one, changes to the Trade Marks Act 1976 must be made and
these must be passed by Parliament with its accompanying regulations. To
this end, the Malaysian Government already has drafted amendments to
the Trade Marks Act, which include provisions for acceding to the Madrid
Secondly, MyIPO must make significant improvements in terms of
upgrading its infrastructure particularly its ICT capabilities so as to
cope with the incoming international filings. Human resources ought to
receive proper training and backlogs should ideally be cleared.
Continuous public consultation, both with the industry's practitioners
as well as the public would also be most welcomed, in part to educate
the latter and for the former, to allay their concerns.
For the first nine months of 2011, the filing statistics show that
MyIPO has received more than 20,000 trade mark applications. More of
interest is the fact that for the past few years, there is a trend
showing that the total number of applications filed by Malaysian
individuals and companies seem to equal the total number of applications
filed by foreigners. This is a healthy indicator that more and more
local businesses and small medium enterprises are becoming aware of the
importance of securing intellectual property protection for their
It cannot be denied that once Malaysia accedes to the Madrid
Protocol, Malaysian businesses will have the opportunity to expand their
trade mark protection across 80 member countries. This in turn will
facilitate growth and trade for Malaysian businesses. In addition, there
is a huge potential to develop their export markets.
Having said that, it must be remembered that the comparative ease of
filing under the Madrid Protocol does not necessarily mean applications
will automatically translate into registrations. After designating
countries of choice, a Malaysian applicant must choose whether or not
they wish to continue with the application in each designated country
and once they do, the application reverts to a home application, subject
to each country's rules and practice. This means that prior to
utilising the Madrid Protocol registration system a Malaysian business
must obtain proper and comprehensive advice with regards to their global
IP protection policies in order to ensure successful registration,
whilst enjoying the reduced costs afforded by the Madrid Protocol.
Ideally, this should be in line with its business activities.
To summarise, change may not be a bad thing yet from the authors'
point of view the road ahead leading to a successful accession and
implementation of the Madrid Protocol will, in all probability, be an
exciting and challenging one for those concerned.
Apart from looking forward to the implementation of the Madrid
Protocol, it is informative to reflect on recent patenting activity in
Malaysia. Five years have passed since Malaysia joined the international
patent system by way of accession to the PCT in 2006. What changes has
this brought for foreign and local IP owners?
Not surprisingly for a developing country, the majority of new patent
applications in Malaysia are now filed through the PCT route. An
analysis of the cases handled by our office shows that over 80% of new
applications originate from PCT filings. Overall filing statistics for
the period 2008-2010 show a healthy growth in the total number of patent
applications being filed. The final figure for 2011 is expected to be
similar to that for 2010, which was a total of 6,464 applications.
The PCT national phase is certainly a preferred route for foreign
applicants. They will normally benefit from a streamlined examination
process when the International Search Report and Written Opinion are
favourable. From our observation, an application that meets these
requirements may even proceed to grant within about one year of
For Malaysian IP owners looking to global markets, the PCT has been a
welcome addition to their toolbox of strategies for obtaining patent
protection overseas. Exports are particularly important for Malaysia.
The country was ranked 16th out of 139 for the value of its exports in
the World Economic Forum's Global Competitiveness Report 2010-2011. The
number of PCT applications filed by the local applicants with MyIPO as
receiving office has increased year-by-year since joining the PCT
system. In 2011, the total figure is expected to be around 300
The first port-of-call for many Malaysian companies filing patents
overseas remains neighbouring ASEAN countries, but other countries such
as Argentina, Brazil, China, India, Japan, Russia and Mexico are now
appearing more regularly on their IP shopping lists.
Growth in patenting activity by Malaysian IP owners is also reflected
in a notable shift in the proportion of domestic applications they file
as compared with foreign applicants. The number of patent applications
filed by local applicants has increased year-by-year since 1997. In
2011, it accounts for about 18% of all applications. This compares with
an historical average (1986-2011) of 9%. Local IP owners also account
for about 14% of the Malaysian patents granted in 2011. The historical
figure is 4%.
Obviously, there is a long way to go before we reach parity of local
and foreign applicants for patents, as has already been achieved for
trade marks. Nevertheless, the statistics do highlight significant
progress as Malaysian industry moves up the value chain. Indeed, the
most prolific PCT applicant from Malaysia is MIMOS Berhad, a research
and development institution that is active in areas such as wireless
communications, advanced informatics and nano-technology.
Patents in action
Patenting activity in Malaysia no longer stops at MyIPO. Patent
enforcement is done by way of civil action in the High Court. In 2007,
Malaysia started to introduce IP Courts, with a plan for an IP High
Court in each of the six states having the most IP disputes. The
introduction of such specialised IP Courts in Malaysia with dedicated
judges is certainly one of the most noteworthy and positive milestones
on the IP scene in recent years. IP cases are now given a much higher
priority and can reach trial within 18 months or so.
Quite a number of patent disputes have already been heard and decided
by the Kuala Lumpur IP High Court. Among the decisions issued in 2011,
the following three cases are noted.
In Ranbaxy (Malaysia) v EI du Pont de Nemours, the plaintiff
(Ranbaxy) sought to invalidate two claims of the defendant's (Du Pont)
Malaysian patent that covered potassium losartan in crystalline form,
which can be used for treating hypertension and congestive heart
failure. Ranbaxy also sought a declaration that it did not infringe
those claims. The plaintiff had obtained regulatory approval in Malaysia
to market a pharmaceutical containing potassium losartan. The defendant
counterclaimed for infringement of one of the claims in dispute.
Various attacks on validity were dismissed. The plaintiff was found to
have infringed the patent and an injunction was ordered.
Positive Well Marketing v OKA Concrete Industries was an infringement
action relating to the plaintiff's (Positive Well) patent for a slope
protection system. The defendant's (OKA Concrete) counterclaim for
invalidation failed and infringement was found. In relation to the
invention's novelty, it was confirmed that a lack of novelty objection
could not be constructed by piecing together separate items of prior
art. As for inventive step, greater weight was given to the evidence of
one of the plaintiff's technical witnesses who was a geotechnical
expert, as compared with the defendant's witness who admitted in
cross-examination to having limited knowledge of the field of the
B Braun Melsungen AG & Anor v Terumo Kabushiki Kaisha concerned
the plaintiff's (B Braun) patent for a safety intravenous catheter. The
patent survived a counterclaim for invalidity. However, the patent
claims were held not infringed as three essential features of the claims
were determined by the judge to be missing in the defendant's (Terumo)
From the stream of decisions that have been issued by the Kuala
Lumpur IP High Court since its inception, a clear message emerges – the
choice of expert witnesses has a significant bearing on the outcome of
each case. One needs an expert whose knowledge of the field of the
invention can be equated as far as possible with that of the fictional
skilled person. At the same time, the expert must not be
overly-qualified in terms of demonstrating inventive faculties.
Presenting an expert that has these qualities and appears honest,
impartial and objective to the judge will not in itself win a case.
However, it will assist the court in assuming the mantle of the person
skilled in the relevant art, and thereby reaching a fair decision based
on the facts.
February 2011 saw the introduction of significant procedural changes
in patent and trade mark procurement with amendments to the regulations.
In particular, there is now a formal process for expediting the
examination of both patents and trade marks, for example in the case of
potential or outgoing infringement.
In November 2011, an amended Trade Descriptions Act 2011 entered into
force. This new act reduced the duration and scope of Trade Description
Orders (TDOs), court orders that are a powerful weapon for enforcement
actions against counterfeiters. The validity term of a TDO has been
reduced from five years to one year, and a TDO can no longer be used for
enforcing unregistered (common law) trade marks.
Meanwhile, the proposed amendments to the Copyright, Designs, Patents
and Trade Marks Acts that we reported on in the last issue of the
Handbook are still waiting to be read in Parliament. This process is
planned to start in March 2012.