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Studies about software patents taken into account by the EP in first reading

To be added

Introductory Question

Q: What is a software patent?

Short A: Software patents are patents on an immaterial innovations. This means that the novel part of the "invention" is limited to a new insight in maths, data processing, business methods, etc. These innovations are normally not patentable, but by stating they are "computer-implemented" (i.e., turned into software) they suddenly do become patentable by the EPO's (and Commission's and Council's) standards. Hence the name "software patents".

Long A:

Economical Questions

Q: Why did the EP categorically say no to software patents?

Short A: Patent law is economic law, and virtually all economic studies show mainly negative effects from software patents. The Commission did not carry out a thorough impact assessment study. The majority of European companies is against software patents.

Long A: As stated in the introduction of BAH02, patent law is economic law. This means that unlike copyright, where there is a notion of a natural author's right to a creation, patents are only to be granted if its clear they will spur the economy and innovation. NRC00 and BH03 (and since the EP's decision, also FTC03) show however that software patents do not have this effect in the US, where they exist already since quite some time. IPI00 and MPF00 could also not find any evidence that software patents would be generally beneficial to European companies, or indeed not even that the negative effects of software patents would be neutralised by the positive ones.

KIO02 indicates that similar patents have very bad effects in the Telecommunications sector. CON00 and MPF01 show that the majority of European companies (both large and small), academics and individuals are against extending the scope of patentability, and that patents are among the least significant forms of IP-protection. Finally, EESC02 shows that the Economic and Social Committee notes that not a single thorough study on the economic effects of software patents has been undertaken, especially in relation to their effects on SMEs (Small and Medium Enterprises). This lack of knowledge is also heavily criticised in BAH02.

Q: Don't investments in software development have to be protected?

Short A: The major investments in software development are protected by copyright, and several other protection means (which require this copyright protection to work) are employed as well. Software patents undermine the protections offered by copyright.

Long A: The ultimate result of the software development process, the computer program, is already protected by copyright. This protection covers the work that went into turning a large number of ideas (a few from yourself, but many from other people as well) into a usable program: creating a design (blueprint) of the program, writing it and then testing it and removing all the errors.

Software patents on the other hand cover the underlying principles and methods of programs (even though patents were originally intended to allow claims on inventions, not on mere ideas). Because of the incremental nature of the software field, every program is bound to use many pre-existing methods and techniques (just like when constructing a mathematical proof, or when writing a story). Allowing monopolies on such individual methods therefore blocks a large number of independent follow-up creations.

This is confirmed by MPF00, where a majority of all questioned companies agrees that the introduction of software patents will diminish competition, reduce the variety of products, and inhibit innovation. It also notes that companies use many different ways to earn back software-related investments (in order of importance): copy-protection measures, customer-relations management, lead-time advantages, protections against reverse-engineering, trademarks, secrecy pledges and incentives for employees, know-how contracts and prosecution of copyrights. Only at the very end, patents are mentioned.

Finally, both KIO02 and BH03 note that software/telecom patents are mainly used strategically (offensively to lock out a competitor from a market segment, and defensively to make sure you cannot be locked out by someone else), and not to earn back investments.

Q: What about mobile phones and washing machines?

Short A: The European Parliament's version does not exclude technical inventions which are computer-controlled. Several patents in the telecom (and electronics) sector are however indeed pure software patents and would remain unenforceable, but KIO02 explains those have an overall negative effect as well. Same for BH03.

Juridical Questions

Q: What is the general idea behind the European Parliament (EP) amendments?

Short A: Keep software-controlled technical inventions patentable, but make sure that non-inventions cannot become patentable by stating they are computer-controlled.

Long A: The doctrine followed by the European Parliament boils down to stating that whether or not an innovation makes use of software, is completely irrelevant as far as patentability is concerned. If the described innovation would be patentable if described in plain English (or another natural language) and when not executed by a computer, would it be patentable? If yes, then your invention is perfectly patentable, also if you say it's entirely realised using a computer program.

If no: sorry, but simply translating the instructions to realise your innovation into a computer program does not suddenly turn it into a patentable invention (the work you did while doing that is protected by copyright, and the rest is either a patentable invention or not, regardless of its form).

Q: Doesn't the EP-version contradict international treaties such as TRIPS?

Short A: No, TRIPs only requires patents to be available for inventions. Software (executed by a computer or not) is not an invention in Europe. Further, TRIPs and WIPO even explicitly forbid software patents.

Q: Isn't the Commission/Council text merely confirming the status quo?

Short A: As EESC02 notes, they simply codify the practice of the European Patent Office (EPO). The EPO has already granted more than 30,000 software and business method patents.

Q: Why did the EP insist on referring to "forces of nature"?

Short A: Patent law must be limited to fields where it has possibly a positive overall effect. The forces of nature doctrine is what distinguished our European Patent law from the US, and the cause for its high international regard. It was abolished when it turned out it was incompatible with software patents.

Q: Why is "data processing" excluded from patentability and what does this mean?

Short A: All a computer can do, is process data. When it is used to control an invention, the computer still merely processes data, but the invention may be or do something patentable. This article ensures compatibility with TRIPs and clarifies that software is not patentable.

Q: Why was the EP not content with the Commission's safeguards for interoperability?

Short A: The Commission only guarantees the right to reverse-engineer, which cannot be forbidden by a patent in the first place. Its article however does not allow the use of the discovered information. Anti-trust law is too blunt a tool to solve this problem.

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