European Commission Directive Patentability

04 March 2002

Peter Ward

Following an extensive consultation exercise beginning in October 2000, the European Commission has published its Proposal for a Directive On the Patentability of Computer-implemented Inventions on 20 February 2002. This had originally been prompted by an earlier consultation related to the 1997 Green Paper on the Community Patent and the Patent System in Europe that had identified an urgent need to remove apparent ambiguities and lack of legal certainty arising from the different ways in which Member States were implementing laws governing patents for computer software. Software development and IT industries are seen by the Commission as highly important to the development of the European economy and effective protection for intellectual property rights is regarded as fundamental in stimulating technological development within the European Community.

Though computer programs "as such" are excluded from patentability by Article 52(2)(c) of the European Patent Convention, thousands of patents for computer-related inventions have been granted by the European Patent Office and national patent offices. While the statutory provisions determining the grant of software related patents are similar, there are differences between the case law of the Board of Appeal of the European Patent Office and the courts of Member States.

The recent consultation phase was based on a paper on the patentability of computer-implemented inventions produced in October 2000 by the Directorate-General for the Internal Market.[1] The Directorate-General also commissioned a study specifically to look at the implications for SME's (small and medium sized enterprises) involved in the development of software and how they managed their intellectual property. Regard was also taken of the likely economic impact of granting patents for computer software, and whether it was desirable to bring European law more into line with the law in the United States and Japan.

The outcome of the exercise is a Proposal that intends to harmonise protection for computer-related inventions while avoiding any sudden change in the legal position. The Proposal both avoids extending the scope of patent protection for software and resists the call to exclude patent protection entirely. However, the position has not remained neutral in that the scope of protection to be offered is arguably more narrow than is the position presently adopted by the European Patent Office.

In particular, the Proposal preserves the present cornerstone in European patent law that the concept of a "technical contribution" is an essential requirement to any patentable invention. To be patentable, a computer-implemented invention will therefore have to make a "technical contribution" to the state of the art that would not be obvious to a person of normal skill in the field concerned, and be more than just a computer program "as such". The grounds for saying that the Proposal will narrow the scope of protection are reflected in the term "computer-implemented" that is used in the Proposal's title. "Computer-implemented" is defined in Article 2 of the Proposal as

"...any invention the performance of which involves the use of a computer, computer network or other programmable apparatus and having one or more prima facie novel features which are realised wholly or partly by means of a computer program or computer programs".

This is reflected in Article 5, which sets out how claims are to be formulated. It states as follows:

"Member States shall ensure that a computer-implemented invention may be claimed as a product, that is a programmed computer, a programmed computer network, or other programmed apparatus, or as a process carried out by such a computer, computer network or apparatus through the execution of software".

The Commission accepts that the Proposal would not allow patents to be granted for computer programs in isolation from a machine on which they may be run, and acknowledges that this is a different approach from that adopted by the European Patent Office. In particular, one has in mind two decisions of the Technical Board of Appeal [2] that determined if a computer program either by itself or on a carrier (e.g. a computer disk) has the potential to produce a technical effect when loaded and run on a computer, such a program claimed by itself should not be excluded from patentability. Article 5 will therefore exclude claims previously allowed by the European Patent Office. This will also affect national patent offices such as Germany where the national courts appears to have approved the position taken by the European Patent Office and also the United Kingdom Patent Office, which published a Practice Notice [3] in April 1999 announcing that it would be adapting its practice to fall in line with that of the European Patent Office.

The policy behind the restriction on existing practice seems designed to ensure that copyright remains the principal protection for computer software. The study into SME's carried out during the consultation process revealed that many smaller software and IT companies was uncomfortable with or uncertain about the protection offered by the patent system. This was not just due to uncertainties over infringement and defining inventiveness, but also because of the cost and the time taken to secure protection (if granted). The primacy of copyright in protecting software is reflected in the proposed Article 6, which specifically deals with the relationship between the Directive as proposed and the current Software Directive 91/250 EC. Proposed Article 6 states:

"Acts permitted under Directive 91/250 EC on the legal protection of computer programs by copyright, in particular provisions thereof relating to decompilation and interoperability, or the provisions concerning semiconductor topographies or trade marks, shall not be affected through the protection granted by patents for inventions within the scope of this Directive."

Unfortunately, the present Proposal does not seem to give any guidance on how practitioners should draft claims from now on, and particularly if they anticipate that a current or proposed patent application would be granted after the Directive came into effect. Any final Directive would have no legal effect on the European Patent Office. If the present European Patent Office practice of allowing "carrier" and "non-carrier" claims was to continue, it is difficult to see how such claims would be maintained in the future in the absence of any proposed transitional provisions. Patents granted after the Directive came into effect would be national patents and subject to national laws, so any claim inconsistent with the Directive's provisions would either be revocable under national law or require amendment. A cautious practitioner might be tempted from now on to draft claims that reflect the proposed Article 5, but could risk missing the opportunity of potentially broader claims if the application were to be granted before the Directive came into effect. The Proposal does not carry an implementation date and will need to follow the usual adoption process through the Council of Ministers and the European Parliament before being implemented by Member States. All this could take some years, and computer/electronics related applications often spend some length of time in examination at the European Patent Office. There is an indication that the Commission would consider taking action to resolve inconsistencies in the context of the European Patent Convention, as was done with the Biotechnology Patents Directive -98/44/EC.

The proposed Directive will also close the door on the prospects of any short term attempt to create a level playing field by harmonising the patent laws in the European Community, the United States, and Japan. By preserving the requirement for any patentable invention to make a "technical contribution", the Commission has turned its back on allowing wider patentability of computer-implemented business methods. The United States does not require that a patentable invention should make a "technical contribution"; it need only fall within the technological arts, and merely using a computer or software means that an invention will be part of the technological arts if it provides "a useful, concrete and tangible result". Japan follows a policy closer to that of Europe in that an invention must represent an advanced creation of technical ideas by which a law of nature is utilised.

Specifically, proposed Article 2 defines a "computer-implemented invention" as meaning, inter alia, any invention the performance of which involves the use of a computer; this is consistent with recent European Patent Office authority, [4] which determined that "& an apparatus constituting a physical entity or concrete product suitable for performing or supporting an economic activity, is an invention within the meaning of Article 52(1)." Proposed Article 4(2) makes it a condition of involving an inventive step that a computer-implemented invention must make a technical contribution, and that the technical contribution should be assessed by consideration of the difference between the scope of the patent claim taking into account both technical and non-technical features, and the state of the art (proposed Article 4(3)). Thus, a method for doing business, or any other field of subject matter excluded under Article 52(2), may still be patentable if it includes a non-obvious technical contribution. However, a patent will not be granted if the technical contribution to the state of the art lies wholly in non-technical aspects, as would be the case if the contribution to the state of the art was purely a method of doing business.

In the long term, Articles 7 and 8 of the Proposal provide for monitoring the impact of computer-implemented inventions on innovation and competition, both within Europe and internationally, and on European business including e-commerce with a view to producing a report on whether or not the rules governing patentability are adequate. While it is not intended to carry out any further consultation exercises, it will be possible to contribute comments during the Proposal's passage to adoption.

2. Computer Program Product I and II, T1173/97 and TO935/97
4. Controlling Pension Benefits System, 7-0931/95 decision dated 8.09.2000

Also published in the March issue of World E-Commerce & IP Report and April issue of WIPR.


The author wishes to acknowledge the following European Commission publications as sources for this article.