Europe clarifies its position on intellectual property

The European Patent Office and the Commissioner for innovation appear to be dancing in sync

The EPO received around 100 submissions from interested parties when it was deliberating

Intellectual property is rightly seen a key competitive tool by businesses and politicians alike. This is why two pronouncements this week from Europe on the subject of patents matter so much.

Yesterday, the Enlarged Board of Appeal of the European Patent Office (EPO) handed down its long-awaited 'opinion' on the extent to which software can be patented under the European Patent Convention.

Its ruling stated that software can only be granted a patent on the grounds of its technical merit - a statement that reinforces the most recent decisions of the EPO.

“To be granted a patent, a program must provide a technical solution to a technical problem,” said Mark Kenrick, partner at intellectual property firm Marks & Clerk LLP. “That means a business method cannot be patented, but a clever way of implementing a business method on a computer can.”

The 'opinion' was required because, over the course of two decades, the position of the EPO has changed. Consequently, UK courts, which have always taken a much stricter approach to refusing patents that appeared to be based on business method, have questioned the consistency of the EPO's ruling.

The software development industry has also been seeking clarity and consistency from the EPO.

In October 2008, EPO president Alison Brimelow posed four questions on the subject of software patentability to the Enlarged Board, as is usual procedure under the Convention. Yesterday the seven members of the Enlarged Board decided that the decisions made in the most recent five years now form the legal position of the EPO, that is, that software can be be granted a patent only on the grounds of its technical merit.

So a patent won't be granted on a business method like it has been in the US, but it can be granted on a unique way of implementing that method in software.

“Today’s decision by the Enlarged Board of Appeal is a very significant move, particularly for software makers who have struggled with the historic divergence and stricter treatment typically given to software in the UK,” said Mark Kenrick, partner at intellectual property firm Marks & Clerk LLP. “By confirming the EPO’s existing approach, the Enlarged Board of Appeal has given industry far greater certainty as to the state of the law at the EPO, which will hopefully bring considerably more clarity and consistency to the patentability of computer-implemented inventions across Europe and its various national patent offices.”

Yesterday's decision makes it more likely that the UK courts will follow the line of the EPO, he added.

Europe clarifies its position on intellectual property

The European Patent Office and the Commissioner for innovation appear to be dancing in sync

By why has it taken the august seven members of the Enlarged Board since October 2008 to make a decision which is, in effect, there is no decision to make?

Well, the EPO doesn't make its decisions in a vacuum. In the time between Brimelow presenting her questions and the decision made yesterday, the Enlarged Board sought consultation from interested parties and received a record number – around 100 – of submissions from IP lawyers, academics, patent offices and a large number from software companies and developers, many of the latter with Free and Open Source Software (FOSS) affiliations.

“Many of the submissions took the opportunity to express their views on whether software patents were a good or bad thing,” the Enlarged Board reports. “Around one-third, including all the FOSS-affiliated companies and groups as well as the individual developers, considered that granting practice should be (generally very much) more restricted than it is now, around 30 per cent appeared to be arguing for roughly the same conditions for grant as at present and about 10 per cent argued for wider patentability.”

Business method patents are anathema to the FOSS lobby. The EPO may not have granted them everything they want, but it has at least upheld the sensible view on this.

The US has traditionally taken a much laxer view when it comes to granting patents to business methods. As a consequence, the US Patent Office (USPTO) is awash with a backlog of what many commentators regard as low-grade patents and the District courts are constipated with litigation from so-called patent trolls (companies that exist merely to accumulate patents and earn licence fees – or litigation damages – from them). Attempts to reform the USPTO and the US patent regime generally have been foundering since 2004.

However, the Bilski case, which the Supreme Court is due to rule on any day now, may well reverse this trend, and business methods will no longer be granted US patents.

Which brings us to the second pronouncement from Europe this week on patents. Máire Geoghegan-Quinn, European commissioner for research, innovation and science, made a commitment to delegates at the European Technology Platforms conference in Brussels, to unify Europe's disparate patent regime, which is often seen by innovative companies as an obstacle to business that only serves to enrich IP lawyers.

The announcement was part of the Commissioner delivering a heads-up on the upcoming Innovation Strategy, which will be presented to the autumn session of the Commission in September.

Geoghegan-Quinn, fully aware that the EC has a reputation for being long on strategy and short on actions has promised the Innovation Strategy will contain an action plan and not just a list of promises.

The opinion handed down by the Enlarged Board to stand by the EPO's most recent decisions is likely to help her cause to that end. One could suspect they may even have conferred.