Select Committee on European Scrutiny Thirty-Fifth Report





COM(02) 92

Draft Directive of the European Parliament and of the Council on the patentability of computer-implemented inventions.

Legal base:

Article 95; co-decision; qualified majority voting


Document originated:

20 February 2002

Deposited in Parliament:

21 March 2002


Trade and Industry

Basis of consideration:

EM of 26 March 2002

Previous Committee Report:


To be discussed in Council:

No date set

Committee's assessment:

Politically important

Committee's decision:

Not cleared; further information requested




    1. In 1997, the Commission issued a Green Paper[27] on making the patent system in Europe more efficient, more accessible and less expensive. It reported the results of consultation in February 1999 in a Communication[28], in which it identified a need to remove the ambiguity and lack of legal certainty about the patentability of computer-implemented inventions. However, in its explanatory memorandum the Commission says that after1999 some sections of the industry repeatedly asked for swift action to remove the current ambiguity and legal uncertainty surrounding the patentability of computer-implemented inventions, while developers and users of open-source[29] software, and a substantial number of small and medium-sized enterprises backing them, were increasingly raising concerns about software patents. So, in October 2001 it published a further consultation document, inviting views on the need for action at Community level, and identifying elements which might appear in a harmonising Directive.[30] The analysis of the responses to this consultation was published in July 2001.[31]
    2. Although in these responses there was a clear demand for action to remove the present lack of clarity, the Commission found that there were sharp divisions between those who wished to see strict limits or a complete ban on software patents, and those who supported harmonisation at more or less the status quo, as defined by the current practice and jurisprudence of the European Patent Office (EPO).
    3. The responses seeking limitation were the more numerous, being very much dominated by supporters of open-source software, but the submissions broadly in support of the approach of the consultation paper, in favour of harmonisation around the status quo, came from regional or sectoral organisations representing large numbers of companies of all sizes, ranging from the Union of Industrial and Employers' Confederations of Europe (UNICE) to the European IT Services Association. Those in favour of harmonisation also included individual intellectual property professionals. Taking into account total jobs and investment, the Commission concluded that the balance of economic weight lay with the responses favouring harmonisation.
    4. The Commission proposal

    5. Accordingly, the purpose of the proposal the Commission now puts forward is to harmonise national patent laws with respect to the patentability of computer-implemented inventions, on the basis of existing EPO practice, and to make the conditions of patentability more transparent.
    6. Articles

    7. These have been summarised by the Parliamentary Under-Secretary of State for Competition, Consumers and Markets (Miss Melanie Johnson) in her Explanatory Memorandum as follows:

"—  Articles 1 and 2 define the scope of the Directive which covers any invention the working of which involves the use of a computer program on a computer.

    • Article 3 requires Member States to ensure computer-implemented inventions have a technical character, and thus belong to a field of technology.

    • Article 4 states the conditions for patentability: an invention must be capable of industrial application, new, and involve an inventive step. The last of these requirements will not be satisfied unless there is a technical contribution which is to be judged by considering the invention as a whole and comparing it to the state of the art.

    • Article 5 requires Member States to ensure that a patent may be claimed for a computer-implemented invention either as a product or as a process.

    • Article 6 preserves the application of the provisions on interoperability and decompilation in Directive 91/250/EEC, which provide that certain actions in relation to interoperability and decompilation do not constitute breaches of copyright.

    • Article 7 requires the Commission to monitor the impact of computer-implemented inventions on innovation and competition.

    • Article 8 requires the Commission, within three years of the date the Directive is to be implemented in Member States, to report on the impact of patents for computer-implemented inventions on innovation and competition, on the adequacy of the rules, and on whether Member States who do not examine novelty and inventive steps before issuing patents have experienced difficulties.

    • Articles 9, 10 and 11 are standard articles governing the coming into force of the Directive and its transposition by Member States."

The Government's view

    1. The Minister recalls that the Government published the conclusions and resulting policy position of its own consultation in March 2001[32]:
    2. "The central conclusion was to reaffirm the principle that patents are for technological innovations. Software should not be patentable when there was no technological innovation, and technological innovations should not cease to be patentable merely because the innovation lies in software. However, there was a need for the law to express this more clearly, and for this clarification to take place as soon as practicable. Ways of doing business should remain unpatentable."

    3. She adds that:
    4. "The Government will consider carefully, in the light of responses to the consultation mentioned below, how far the proposal succeeds in meeting these objectives and clarifying the law".

      Regulatory Impact Assessment (RIA)

    5. The RIA attached to the Explanatory Memorandum notes that:
    6. "Notwithstanding the prevalence, and importance, of patents in this field, the law on what may be patented lacks clarity. Although Member States' laws and the European Patent Convention are intended to achieve the same results, their application in case law and administrative practice has diverged. The result is that the industry lacks certainty as to what may, and may not, be patented, and a computer-implemented invention may be protected in one Member State and not in another one".

    7. According to the RIA, uncertainty may lead some companies to err on the side of submitting patent applications which have little chance of success, thus incurring unnecessary costs. On the other hand, the complexity of the situation may deter others, particularly SMEs, from seeking patents at all, which means they may be missing financially advantageous opportunities. Moreover, uncertainty tends to drive up costs in every part of the patenting system, making infringement harder to predict and disputes more likely. In addition, complexity about the intellectual property rules may act as a barrier to entry to the market. The benefit of the proposal for the Directive, provided it succeeds in clarifying the law, will lie in alleviating these problems. As far as costs are concerned, the RIA suggests that these are likely to remain unchanged or fall.
    8. Consultation

    9. According to the RIA the central conclusion of the Government's consultation in 2000 was that it reaffirmed the principle that patents are for technological innovations:
    10. "Software should not be patentable when there was no technological innovation, and technological innovations should not cease to be patentable merely because the innovation lies in software. However, there was a need for the law to express this more clearly, and for this clarification to take place as soon as practicable. Ways of doing business should remain unpatentable".

    11. The Patent Office has now contacted those who responded to the 2000 consultation to invite their views on how far the draft Directive meets these objectives.
    12. The Minister declares that she is satisfied that the benefits to be derived from the proposal justify the costs.
    13. Conclusion

    14. The Commission and the Government have carried out extensive consultations on this draft proposal and the Minister is satisfied that it will be beneficial. The Regulatory Impact Assessment finds that it should confer particular benefit on SMEs. The responses to the Government's latest consultation were due to be in by 7 June.
    15. We ask the Minister to write to us again when these responses have been analysed. Meanwhile, we shall not clear the document.


27  (18260) 9675/97; see HC 155-v (1997-98), paragraph 8 (5 November 1997). Back

28  Promoting Innovation through Patents: the follow-up to the Green Paper on the Community Patent and the Patent System in Europe COM (1999) 42 final, 5 February 1999; (19882) 5944/99; see HC 34-xvii (1998-99), paragraph 6 (28 April 1999) and HC23-xxviii (1999-2000), paragraph 2 (1 November 2000). Back

29  One of the criteria for defining open source software is that the licence must not restrict anyone from making use of the programme in a specific field of endeavour. For a full definition see plain.html. Back

30  The Patentability of Computer-Implemented Inventions available at / indprop.softpaten.htm. Back

31  available at Back

32  Should Patents be Granted for Computer Software or Ways of Doing Business? The Government's Conclusions available at http:// Back

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