It contains contributions from Government, industry and enforcement agencies and highlights enforcement activities undertaken in 2004. It provides the current state of play and highlights the key areas of threat for rights holders. From the conclusion:
"[...] Many high profile prosecutions have been carried out throughout 2004 and there have been strong signals of lengthier sentencing, confiscation orders and higher penalties for those convicted of counterfeiting and piracy. In addition, hundreds of illegal criminal rings have been disrupted by anti-counterfeiting squads. However there appears to be a general consensus that the enforcement response in the UK has merely been a hindrance to the organised groups that are now involved.
To avoid control slipping to the criminals there is a critical need for substantially increased co-operation, communication and commitment among the global, regional and national agencies, in partnership with the private sector.
In addition there needs to be a much higher degree of knowledge about the scope and scale of the problem and the specific areas of threat and weakness in enforcement activity. It is essential to develop:
Consistent methodology for measurement and assessment;
An intelligence led strategy where information is shared;
Improved implementation of IP rights and supporting legislative frameworks;
A cohesive strategy to help raise awareness and to educate, enforcers, the judiciary and consumers;
Improved awareness of private sectors of their IP rights and the means available for implementing them;
Better communication and co-operation between rights holders, police, enforcers and local and central Government agencies involved in their protection.
We should also assist in the development of regional Trading Standards IP groups for all regions, such as those currently set up in the North West and Wales. These partnerships will improve the sharing of knowledge between authorities and help to provide a more co-ordinated response.
There are clear benefits in driving a co-ordinated approach. To achieve this there is a critical need for specialised working groups. A control strategy decided by a high level decision making group made up of key decision makers from Government, industry and enforcement who will set priorities for prevention and enforcement. I n conclusion, the report aims to provide initial information that will allow us to develop a suitable co-ordinating mechanism. It is also hoped that alongside the IP Crime Group and the Creative Industries Intellectual Property Forum the structure will facilitate a more coherent approach to enforcement. In the medium term we recognise that these aims will take time to realise and we accept that this report is compiled in a transitional period.
Nevertheless, from the reports presented by the contributors it is evident that there are key elements that we can begin to address as part of our work over the next year. [...]"
A control strategy for the IP Crime group has been formulated in association with the National Criminal Intelligence Service, and various expert groups are being formed to address the problems highlighted in the report.
"[...] The Working Group of industrialised nations on intellectual property and development set up by the meeting in February 2005 at the United States Patent and Trademark Office in Alexandria met at the European Patent Office in Munich on 21 and 22 March 2005. The meeting was attended by 53 delegates from Austria, Belgium, Canada, the Czech Republic, Denmark, the European Commission, the European Patent Office, Finland, France, Germany, Hungary, Italy, Ireland, Japan, Lithuania, Luxembourg, the Netherlands, New Zealand, Norway, Poland, Portugal, Romania, Spain, Sweden, Switzerland, United Kingdom and the United States of America.
The meeting reaffirmed its support for the World Intellectual Property Organization's long-standing work in the area of development-related aspects of IP. The meeting recognised that we should do more to ensure that capacity building is targeted to the expressed needs of developing countries and that we should adopt a "demand driven" approach. We should find ways in which development partnerships can be created, shared and monitored to avoid duplication and assess effectiveness. Capacity building covers not only the building of IP expertise and resources, but should include ensuring that IP systems in developing countries function to facilitate growth and development.
The meeting noted the need to go beyond issues of capacity building and deepen our understanding of the relationship between IP and economic, social and cultural development.
The meeting also discussed existing proposals, including those from Switzerland, the European Union and the United States on the disclosure of the origin/source of genetic resources and related traditional knowledge in patent applications. There was consensus to discuss this matter further within WIPO.
In summary, an active meeting at which all confirmed their commitment to working together with all countries within WIPO to develop the IP system for the benefit of all and with needs of developing countries integral to our work. [...]"
Presidency Compromise Proposal for a Regulation on Compulsory Licensing of Patents Relating to the Manufacture of Pharmaceutical Products.
The Luxembourg Presidency has just published Document 7394/05 conveying a Presidency compromise proposal for a Regulation of the European Parliament and of the Council on compulsory licensing of patents relating to the manufacture of pharmaceutical products for export to countries with public health problems. On 14 November 2001 the Fourth Ministerial Conference of the World Trade Organisation (WTO) adopted the Doha Declaration on the TRIPS Agreement and Public Health. The Declaration recognises that each WTO Member has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted. It also recognises that WTO Members with insufficient or no manufacturing capacities in the pharmaceutical sector could face difficulties in making effective use of compulsory licensing. On 30 August 2003 the General Council of the WTO adopted the Decision on the implementation of Paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health. Subject to conditions, the Decision waives certain obligations concerning the issue of compulsory licences set out in the TRIPS Agreement, to address the needs of WTO Members with insufficient manufacturing capacity.
European Patent Office Applicant Panel Survey 2004 Report has been published.
The European Patent Office Applicant Panel Survey 2004 Report is now available. The main document gives the results of a survey carried out by the EPO on a sample of applicants in 2004. The purpose of the survey was to find out intentions towards future numbers of patent filings. The results have been used to forecast overall likely numbers of filings for 2005 and 2006.
(Source: EPO)
"[...] Each year the EPO carries out a survey of filing intentions by applicants for European patents. In summer 2004 the latest survey was carried out by Roland Berger Market Research acting as researcher and consultant, using a questionnaire sent by fax and follow-up interviews. The survey design was similar to the one done in 2003 and has been executed and analysed by the consultant. The survey finds modest degrees of optimism among applicants regarding future numbers of patent filings in years 2004 to 2006. But it should be appreciated that the results of the survey are liable to large degrees of statistical error, summarised often by fairly wide 95% confidence intervals on the forecasts.
For us, the main purpose of the survey is to provide information on likely filing developments into the EPO's annual forecasting exercises for budgetary planning purposes. This effort is made in January each year, with the current objective being to forecast annual patent filings out as far as 2010. The survey is executed some months before January, so that the results become available in time for the planning exercise.
In this report there is a description of the survey set-up and execution, followed by a discussion of results. After presenting some descriptive statistics, the report concentrates on estimating future inputs for the main workload items at the EPO: Direct European route filings, Euro-PCT international phase filings and Euro-PCT regional phase filings. Then there is a discussion of filing trends for applications in other world patent systems (France, Germany, Japan, UK, USA). This is followed by information on R&D expenditures, inventions and first patent filings for each of the 14 main technology joint clusters that exist at EPO. Finally some statistics are presented that discuss survey items on time lengths between initial R&D expenditures and patenting, usage of the epoline® electronic filings system and patent licensing activities. [...]"
"[...] The OHIM processed some 75 000 trade mark applications in 2004 – thus eliminating the backlog of 35 000 applications that existed at the end of 2003. This remarkable progress was achieved by doubling the number of examinations, formalities checks and publications achieved in 2004 compared to 2003. The result is that 90% of trade mark applications are now published within 10 months of receipt. In October, we decided to write a letter to all applicants once formal examination of their application is complete, and before national searches and translation are conducted, informing them of the outcome of examination.
[...]
The new Community design system, which started in 2003, has continued to be a success during 2004. So far the OHIM has dealt with 21 000 design applications containing over 81 000 designs. An increasing number of applications are expected in the next year. [...]"
With regard to the Community Trade Mark as well as to the Community Design the OHIM is in a competition-like situation with the various national Patent and Trade Mark Offices where applicants can get protection on a State-by-State-basis.
The UKPO is grateful for all the comments received and recognises the concerns raised.
* There was no clear consensus from the consultation that the provisions that result from Article 65 (translations on grant) and Article 67 (provisional protection) should be linked. Since the agreement does not address the question of Article 67, it is not proposed to alter UK law in terms of its enactment of Article 67.
* Likewise, there was no real demand for the UK Patent Office to provide any additional non-statutory services. Moreover, it was felt that the other provisions in the Court Procedure Rules and within the Patents Act 1977 were sufficient.
* There was clear preponderance of views that the UK should implement the agreement using the provisions on 77(6) in rule 2 of the draft Statutory Instrument.
* There was a clear preference that the UK should ratify and the agreement should only be implemented once the agreement comes into force, ie once sufficient states have ratified.
It is therefore the conclusion of this consultation that the provisions under Rule 2, relating to translations on grant should be taken forward. The rule under 78(7) relating to provisional protection before grant should not be taken forward.
* There were also some comments on the effect of rule 1, and its implications. These have been considered in the final drafting of the Statutory Instrument, with consequential changes to the explanatory note.
* Further issues relating to the question of competence were raised, and these have been considered in detail so that legislation and ratification can proceed.
The issues raised during the consultation relating to the balance of costs have been further considered and are reflected in the Regulatory Impact Assessment.
Next Steps
It is proposed to introduce a Statutory Instrument in the course of 2005, and that Ratification of the London Agreement should follow. [...]"
I am happy to see that the London Agreement gets support from London. However, the key to the entry into force of the Agreement is still in Paris.
Any State party to the London Agreement having an official language in common with one of the official languages of the European Patent Office will, after entry into force, have to dispense with the translation requirements provided for in Article 65, paragraph 1 of the European Patent Convention. Any State party to the Agreement having no official language in common with one of the official languages of the European Patent Office will have to dispense with the translation requirements provided for in Article 65, paragraph 1 of the European Patent Convention, if the European patent has been granted in the official language of the European Patent Office prescribed by that State, or translated into that language and supplied under the conditions provided for in Article 65, paragraph 1 of the European Patent Convention.
[UPDATE] 2005-03-22 Obviously the United Kingdom has already amended national law. However, the "The Patents (Translations) Rules 2005" will cause Section 77(6) of the Patents Act 1977 cease to have effect only on the day of the coming into force of the Agreement on the application of Article 65 of the Convention on the Grant of European Patents made in London on 17th October 2000(b).
"[...] EXPLANATORY NOTE
(This note is not part of the Rules)
These Rules implement Article 1(1) of the Agreement on the application of Article 65 of the Convention on the Grant of European Patents made in London on 17th October 2000 (“the London Agreement”). The London Agreement is published as Cm 5247 Miscellaneous Series No. 9 (2001).
Currently, Article 65(1) of the Convention on the Grant of European Patents made in Munich in 1973 (“EPC”) allows an EPC contracting state to impose a requirement on a proprietor of a European patent to file a translation of the patent, as granted or amended, if it is not in an official language of the state concerned. The EPC is published in Treaty Series No.16 (1982) Cmnd 8510. Section 77(6) of the Patents Act 1977 (“the Act”) corresponds to Article 65(1) of the EPC. Section 77(6) came into force on 1st September 1987 by virtue of rule 4(1) of the Patents (Amendment) Rules 1987 (S.I. 1987/288).
Where the European Patent Office (“EPO”) publishes a specification of a European patent (UK) in French or German, section 77(6) of the Act requires a translation into English of such specification to be filed at the Patent Office, within three months of the date of publication, before the European patent (UK) may have effect in the United Kingdom. The same applies to any amendment made in French or German to such specification. Before the specification as amended may have effect in the United Kingdom, within three months of the date of its publication, a translation of it into English must be filed at the Patent Office.
The London Agreement (Article 1(1)) provides that any State having an official language in common with one of the official languages of the EPO (namely English, French or German) must dispense with translations under Article 65(1) of the EPC.
By virtue of these Rules, section 77(6) of the Act ceases to have effect on the day the London Agreement comes into force. [...]"
Statement of the EU Commission on the EU Council's Decision Concerning the Draft Directive on the Patentability of CII.
On March 10, 2005, the Secretary-General of the European Commission has sent to Mr Javier Solana, Secretary-General/High Representative, a Communication COM(2005) 83 final from the Commission to the European Parliament pursuant to the second subparagraph of Article 251(2) of the EC Treaty concerning the common position of the Council on the adoption of a directive of the European Parliament and Council on the patentability of computer-implemented inventions. The Commission in particular provides remarks as follows:
"[...]3- COMMENTS ON THE COMMON POSITION
3.1 General remarks
The Council, acting by qualified majority, has adopted a common position which incorporates the substance of some 25 of Parliament’s amendments at first reading. The Commission has indicated that it accepts the common position, even though this differs from the Commission’s original proposal in certain respects. In general, the Commission believes that the common position strikes an acceptable balance between the interests of right holders and those of competitors and consumers (including in the open source community). This balance is further safeguarded by the new requirements in Article 7 for the Commission to monitor the impact of computer-implemented inventions in particular on small and medium-sized enterprises and on the open source community.
As far as the Commission is concerned, the directive continues to address the key objective stated in the explanatory memorandum of the Commission’s proposal, namely the harmonisation of patent law between the Member States and the resolution of legal uncertainty in this field. It is crucial to note that there is to date no Community legislative instrument which affects general patent law either in a horizontal manner or specifically relating to computer-implemented inventions. The adoption of this directive would therefore have the effect of bringing patent law in this field, for the very first time, explicitly within Community jurisdiction.
A failure to adopt a directive would prevent Community institutions from exercising control in this strategic area of the European economy, which would thus remain within the remit only of national patent offices and courts and the European Patent Office in Munich.
3.1.1 Computer program product claims
Although the Commission’s proposal did not explicitly permit claims on computer programs on their own or on carriers, the Commission has accepted Article 5(2) of the common position as this has to be understood as relating to the enforceability of (existing) patent rights and not to extending the scope of patentability. This is reinforced by the explicit link with Article 5 (1) as mentioned below. To the extent that the relationship between Article 5(2) and the exclusion of computer programs as such (as is explicitly laid out in Article 4(1)) is open to differing interpretations, the text may need further clarification.
Acts relating to computer programs on their own or on carriers could be subject to proceedings for contributory infringement even without provisions equivalent to Article 5(2). The effect of Article 5(2) is thus to facilitate enforcement of legitimate rights by ensuring that such acts may constitute direct, rather than just contributory, infringements. This is particularly important in cases of infringements across national boundaries as Member States’ courts do not have jurisdiction over contributory infringements occurring outside their national territory. I n any case, the final part of Article 5(2) makes clear that the claim on the computer program on its own or on a carrier has to put in force a patentable product or process claimed in the same patent application (and falling within the scope of Article 5(1)). This ensures that Article 5(2) cannot constitute protection equivalent to the patentability of computer programs as such, a reading which is furthermore confirmed by the more explicit language of the common position, in particular of Article 4 paragraphs 1 and 2.
3.1.2. Interoperability
The Commission is strongly committed to the promotion of interoperability as a means of fostering innovation and competition. This is consistent with the objectives of the Commission’s proposal to help safeguard investment in inventions which are new, inventive and industrially applicable. It is important to note that the requirement for sufficient disclosure of a patented invention may facilitate access to information useful in achieving interoperability of computer-implemented inventions.
The Commission affirmed its commitment to the policy objective of promoting interoperability and fostering innovation by explicitly preserving in Article 6 existing interoperability exceptions under copyright law
The Commission believes that the Council common position remains consistent with these objectives. Equivalent conditions for patentability have been maintained in new Articles 3 and 4 (read in conjunction with Article 2). As expressed in a statement by the Commission to be entered in the minutes of the Council adopting the common position (see below), the Commission considers that Article 6, read in conjunction with Recital 22, permits any acts as described by Articles 5 and 6 of Directive 91/250/EEC on the legal protection of computer programs by copyright, including any acts necessary to ensure interoperability, without the need for authorisation from the patent’s right holder.
The Commission furthermore welcomes the fact that safeguards for interoperability have been strengthened in Article 8(d) and (g) in terms of the requirements on the Commission to report on how the situation regarding interoperability has been affected by the passage of the directive.
In the light of the Community objective of promoting interoperability, the Commission intends to facilitate the approximation of the Council and Parliament positions drawing on amendments put forward by both institutions in first reading.
Furthermore, Recital 21 recalls that a dominant supplier who refuses to allow the use of a patented technique to achieve interoperability is subject to the application of competition rules and in particular Articles 81 and 82 of the Treaty. The application of these Articles therefore contributes to achieving the objectives laid out above, although it is of course important to note that competition law on its own cannot solve all potential problems in this area. [...]"
I think that any claims directed to computer program products are somewhat problematic not only because of they might put 'free speech' at risk but also because I am convinced that no software code taken as such has any attributable meaning in terms of software functionality unless a certain type of processor is assigned. If someone would act to download some arbitrary file from the Internet you cannot - in any meaningful strict sense - without further secondary intelligence determine whether or not this file can act as a piece of software that exhibits a certain kind of functionality infringing a certain patent.
Only if there is some additional information saying that such file is intended e.g. for execution on an Intel Pentium Processor or on some other named processor, a judge presiding over infringement proceedings could be able to determine the functionality of the file taken as software in order to compare it with the teaching in a patent claim. There is no escape from the requirement of contributory infringement to show that the code is not only suited but also designated to exhibit a certain infringing functionality; it is in fact essentially the same game as in case of contributory infringement.
As an improvement of the trans-border enforceability of contributory infringements should be seen as the main issue for allowing claims on computer program product claims I would prefer to amend the law on infringement accordingly instead of fostering such kind of patent claims effectively blurring the semantics of patent claims.
Concerning the problems related to interoperability I would like to refer to my earlier posting here.
FOSS and the Patent System: Paradox Side Effects of Anti-Patent Networking.
Working on product-specific patent clearance opinions is always a difficult matter. Even for a Patent Attorney, and so not only with regard to computer-implemented inventions but also concerning other fields of technology. In pure theory, a product clearance looks to be quite trivial: Just go through all existing patents in force and check whether or not the product infringes. But, of course, in practice this complete enumeration method scales poorly and you need to find good heuristics in order to discriminate classes of patents worth a closer look from other classes of patents which can be disregarded right from the beginning. In most cases, due to financial constraints, such opinions have to be restricted to the analysis of just a couple of potentially relevant patents from well-known competitors or so.
In particular the Free and Open Source (FOSS) community is afraid of accidentally violating third party's patents. How to find relevant patents without having a well-funded organisation backing laborious and expensive patent searches?
One of the strengths of the FOSS software creation and maintenance process is that in a network of developers and users (which are not clearly distinguishable) meta-information concerning the particular software package can flow freely.
Can this kind of a network also be used to improve the gathering and processing of patent-related information?
Nowadays, some quite paradox things can be watched: For purposes of a political fight against the patent system, a lot of FOSS stakeholders not bound to pro-patent companies have created information pools where they share news concerning individual patents and their potential or factual impact on certain FOSS software packages. Although planned merely as a tool for scandalising distinct aspects of the patent system, in general, and of the patentability of computer-implemented inventions, in particular, such information pools surely also have a side effect that certain patents of particular importance have become fairly prominent, and virtually every developer has a chance to learn of them.
And recently I stumbled over an excellent article on "collaborative filtering" in the print edition of The Economist which is also available on the Internet (Reg. req'd):
"[...]Collaborative filtering starts off by collecting data on individuals' preferences. This can be an explicit process, by which a user ranks a book (or CD, or restaurant) on a numerical scale, typically on a scale of one to five. It can also be an implicit process— a purchase, for instance, is a clear indication that an individual is interested in the item in question. But implicit measures can also be more subtle; for instance, the amount of time spent viewing a web page, or even just the 'clickstream'— the sequence of links clicked on by a person browsing on the web. These different methods can then either be aggregated into a single score, or stored separately to allow more detailed analysis. And sometimes, consumers will be asked to score the same item in different ways — for instance, what one thought of the food at a restaurant, and what one thought of the service.
The result is a mountain of data, the size of which is the main challenge when it comes to searching it for patterns. But things are helped slightly by the 'sparseness' of the data. The vast majority of items do not have a ranking, implicit or explicit, from any given user. Even the busiest users have rarely ranked more than 1% of the items. Amazon, for instance, sells over 2m books through its online store. The sparseness of the data is a saving grace, because it allows various mathematical techniques to be brought into play which vastly speed up the process of generating recommendations. [...]"
In principle, it should be possible to set up a website where stakeholders (developers and users) not only can highlight patent applications and/or granted patents but can also rank them with regard to their assumed impact on a certain FOSS project, e.g. based on cease-and-desist letters issued by patent holders and/or litigation-related activities as well as on general considerations on granted claims. Certain cryptographic protocols can be utilised in order to make sure that such ranking processes are pseudonymous. Someone who thinks that a certain patent application or patent might be relevant with regard to a certain software project would have a chance to get from such a system a list of other patent applications and patents which have been considered relevant by other stakeholders in similar contexts. This way, 'clusters' of close-by patents might be identified in the same fashion as 'clusters' of close-by books are determined by on-line retailers like Amazon. Of course, such collaborative filtering would not replace a thorough legal analysis of a given claim in the context of a particular FOSS project in the light of the applicable law but the filtering might be an important inprovement, prior to any expert analysis, in finding potential needles in the heystack.
Maybe that the FOSS community might have a chance to be best informed about potentially conflicting patents, even better than other stakeholders not sharing such kind of collaborative filtering network.
There are, however, at least two serious difficulties to surmount:
In some countries (e.g. in Germany) there is so much red tape that publicly discussing individualised legal affairs could be dangerous (in Germany, providing legal advice is not allowed in general but reserved to attorneys and a few other groups. This "Rechtsberatungsgesetz" originating from Nazi times is more or less likely to be revised in near future).
More severe is, however, that it looks as if a vast majority of such stakeholders in FOSS who are not bound to pro-patent companies have, at least for now, chosen to reserve their energy for politically fighting against the patent system, refusing to assume a more constructive role.
"Ericsson chief warns on weak software patent law By Nicholas George in Stockholm Published: March 14 2005 02:00 | Last updated: March 14 2005 02:00
Ericsson, the world's largest supplier of mobile telecommunications networks, has warned of disastrous consequences for Europe's technology industry if the European parliament weakens new software patent rules.
In an interview with the FT, Carl-Henric Svanberg, chief executive of the Swedish group, described the debate aimed at reducing the level of patent protection as very dangerous. "This would be a major, major problem for the technology industry in Europe," he said. [...]"
One more voice of the industry stressing that effective patent protection for computer-implemented inventions is absolutely necessary. A heavy-weight voice, indeed.
In my earlier post of February 25, 2005 I had quoted the Director General of the World Intellectual Property Organization (WIPO), Dr. Kamil Idris, as follows:
"The Casablanca consultations were very positive and fruitful and resulted in a boost for the whole work program of WIPO, particularly, substantive patent law, traditional knowledge, folklore and issues related to genetic resources and the proposed WIPO Development Agenda. The constructive approach taken during the consultations will, I believe, go a long way in resolving outstanding issues in all these important areas and demonstrates a commitment to multilateralism."
However, now there are quite contradictory reports. IP-Watch writes:
"[...] A key group of developing countries this week sent a potential shockwave through fledgling efforts at the World Intellectual Property Organisation to restart talks on the international harmonisation of national patent laws. [...]
Without directly criticising WIPO, the statement could serve to undermining the legitimacy of the Casablanca meeting, according to a developing country official. 'By reaffirming our position on the Substantive Patent Law Treaty,' the official said. 'Our statement effectively counters Casablanca and makes it clear that the Casablanca statement does not represent any kind of a consensus and has not taken account of our views.' [...]"
The Eleventh Session of SPLT deliberations will be held in Geneva from June 01 to June 02, 2005. The Committee will continue its discussion on a draft treaty on harmonization of certain provisions of patent law and practice. Invitations: As members, the States members of WIPO and/or of the Paris Union; as observers, other States and certain organizations.
Patentability of CII: New Documents from the EU Council.
The EU Council has publised an amended version (Document 11979/1/04 REV 1 ADD 1) of a Draft Statement of the Council's Reasons concerning the Common position adopted by the Council on 7 March 2005 with a view to the adoption of a Directive of the European Parliament and of the Council on the patentability of computer-implemented inventions. The text concludes:
"[...] In its common position, the Council has taken over a considerable number of amendments proposed by the European Parliament. Throughout the common position, the Council has sought to strike a reasonable and workable balance between the interests of rightholders and those of other parties concerned. The overall balance of the Council’s common position has been acknowledged by the Commission, which has accepted it as a satisfactory compromise package. [...]"
Moreover, the Council has published another Document 16120/04 ADD 4 exhibiting an Annex with the text of two additional statements for entry in the minutes of the meeting of the Council (Competitiveness) of 7 March 2005:
"[...]Statement by Denmark
Denmark supported the compromise reached in the Council in May 2004 concerning the proposal for a Directive on the patentability of computer-implemented inventions, on the basis that it would ensure clearer rules in this field and that a codification of existing practice took place, while at the same time preventing patentability of non-technically products.
It is on this basis that Denmark through the Council will participate in future negotiations on the proposal with the European Parliament. In this context, Denmark attaches particular importance to ensuring access to interoperability, that only technical inventions can be patented and that neither pure software nor business methods can be patented. In the future negations Denmark will therefore work to ensure that these elements are reflected in the text in a balanced way.
Statement by the Republic of Cyprus
With regard to the proposed Directive on the patentability of computer-implemented inventions though the government of the Republic of Cyprus supports the goals laid down therein especially the harmonization of diverse/different practices in the said area in the EU member states, the improvement of transparency and strengthening legal certainty and clear conditions for the protection of computer implemented inventions, nevertheless the proposed Directive should offer more clarity on which inventions are patentable and which are not. This is of paramount importance for individuals, organizations and particularly small and medium sized enterprises active in the area of information technology and the development of the domestic industry thus enhancing competitiveness and strengthening the research area. [...]"
BSA Welcomes EU Council's Common Position on the CII Directive and Calls for a Reform Agenda to Enhance SMEs’ Access to the European Patent System.
The Business Software Alliance (BSA) describes itself as "the voice of the world's commercial software industry and its hardware partners before governments and in the international marketplace". In a recent press release they wrote:
"[...]The Business Software Alliance (BSA) welcomes today’s adoption by European Industry Ministers of a Common Position on the draft Directive on Computer Implemented Inventions. More than 30,000 European patents have already been granted for computer-implemented inventions in Europe over the past decade, including for such everyday items as vehicle anti-lock braking systems and global positioning systems, contributing significantly to European innovation and competitiveness. Despite this, so-called 'CII patents' have lately faced unreasonable criticism from some quarters, and a formal clarification of European Union law in this area is long overdue.
While welcoming the Common Position, BSA wishes to open a public debate on the fundamental issues of the overall quality of patent protection in Europe and of access by small- and medium-sized enterprises to the general European patent system.
[...]
BSA proposes a set of initiatives that would improve the European patent system with a particular focus on the needs of SMEs. BSA proposals submitted to the European Institutions include:
1) Creation of an “SME Committee” that would monitor SME participation in the patent process.
2) Establishment of an SME discount on EPO and national patent office fees.
3) Improvement of the patent opposition process by amending existing procedures to make them faster.
4) The systematic collection of prior art data regarding patent litigation, in particular where CII patents are involved.
5) Tracking of patent data with particular regard to the patents owned by SMEs through the collection of data by the European Patent Office and national patent offices.
6) Establishment of a technology patent oversight team within (or outside) the EPO to monitor 'quality control' on an ongoing basis.
7) Reduction or elimination of the practice of fee diversion, where member states can divert portions of fees collected for non-patent purposes. [...]"
I can only welcome this statement of BSA because of it not only acknowledges the necessity of maintaining the patentability of computer-implemented inventions on a more clarified legal basis but also shows that the patent system as it stands now actually needs improvement in order to serve also SMEs. Yes, the patent system needs improvement, not destruction as proposed by the various anti-patent campaigners. The points made by the BSA statement should be thoroughly examined, and perhaps other supplementary proposals might come up.
"[...] STRASBOURG, France (Reuters) - The European Commission will not propose a new law on the patenting of computer-related inventions if the European Parliament rejects the current controversial proposal, a top official said on Tuesday.
"If the parliament decides to reject it, then the Commission will respect your wishes. I will not propose a new directive," EU Internal Market Commissioner Charlie McCreevy told lawmakers.
"You can of course reject or substantially amend the proposal," he said. [...]"
This is indeed an important message: The EU Commission will not give the patent critics amongst the Parliamentarians another chance to reconsider a second version of a Directive on computer-implemented inventions which then might be more restrictive.
Now the Parliament has two options:
Mooting to legally challenge the decision of the EU Council, in particular by invoking the European Court of Justice (ECJ); or
Starting with the Second Reading of the Directive as proposed by the EU Council.
The worst case development would surely be that the Parliament concentrates to press for severe amendments in a Conciliation Committee. Such amendments might perhaps go into the direction of the amendments as proposed by the Parliament as a result of the first reading. Such re-enforfced proposals would then hit the EU Council during deliberations in the Conciliation Committee. Given the dominance of the anti-patent campaigners' paroles in some of the EU Member States' national Parliaments, there could be some pressure on the respective national Govenments to accept amendmends as a result of the deliberations in the Conciliation Committee which are far away from the wording as sent into the second reading. But there is still hope that a sufficient number of Parliamentarian will be reasonably sceptical towards the proposals of the anti-patent extremists. And, I still hope that the EU Commission would, under worst case circumstances, have the necessary standing for pulling the plug by revoking the original legislative proposal in order to prevent the industry being harmed by the destructive proposals of the anti-patent movement. No Directive would be far better than any Directive that comes close to that of the first reading.
Breaking News: EU Council has formally adopted Draft Directive on Patentability of CII.
Heise Newsticker has just now reported [in German only, sorry] that the EU Council has eventually formally adopted the political agreement on the Draft Directive on the patentability of computer-implemented inventions as of May 2004.
EU Council: Big Showdown on Patentability of CII to happen just to-morrow?
Well, tomorrow March 07, 2005, Brussels will see the 2645th meeting of the Council of the European Union in the Competitiveness Configuration (Internal Market, Industry and Research). And there is a topic "2" on the agenda which reads:
"Approval of the list of 'A' items 6810/05 PTS A 10".
But Document 6810/05 is silent on the Draft Directive on the patentability of computer-implemented inventions. Did the Luxembourg Presidency of the EU Council fail to put that matter on the agenda?
"[...] Public deliberation item 10. Adoption of (a) the common position adopted by the Council with a view to the adoption of the Directive of the European Parliament and of the Council on the patentability of computer-implemented inventions (LA+S) 11979/04 PI 61 CODEC 962 + COR 1 (es) + COR 2 (de) 16120/04 PI 77 CODEC 1346 OC 475 + ADD 1 + ADD 2 + ADD 2 COR 1 (en) + ADD 3 (en) (b) the draft statement of the Council's reasons 11979/04 PI 61 CODEC 962 ADD 1 + ADD 1 COR 1 (de) + ADD 1 COR 2 (es) approved by Coreper, Part 1, on 15.12.2004[...]"
Hence, it looks as if the stage is set: "Public Deliberation Item" means that the general public will be able to watch the (final?) showdown.
The anti-patent protesters have triumphantly announced (see FFII, nosoftwarepatents.com) that Denmark will refuse to accept the formal adoption of this matter as an "A"-Item; to the contrary, it was said that Denmark will insist on re-opening the discussion of that matter as a "B" Item. They say
"[...] This afternoon, the EU Policy Committee of the Danish parliament took a binding decision (i.e., not just a resolution that a government is legally free to ignore) that the Danish government shall oppose the adoption of the current proposal as an A item (an item for debateless approval) in Monday's meeting of the EU Council, and shall request that the proposal be renegotiated (as a B item) in the future.
The Polish government has previously stated that it is against the proposal but "cannot fight alone". Now that Denmark sides with it, Poland has the chance to express its true position on Monday. [...]"
But on the other side it seems to be clear that
"[...] Minister Bendtsen (Conservatives) did not want to reopen discussions, but the minority government he is part of was overruled by a coalition consisting of a.o. Social Democrates and the Social Liberal Party in the Parliament's EU Affairs Committee. [...]"
So, the voting was merely in a Committee rather than in a full plenary session. Can a vote taken in a Danish Parliamentary Committee be binding for the Danish Government?
"[...] Lone Dybkjær from Det Radikale Venstre (Social Liberal Party) says the minister is obliged to follow this decision to ask to take the A-item off the agenda. [...]"
I am clearly not an expert in Danish constitutional law and, hence, I won't place my judgement here on that question. I am, however, quite sure that in Germany no vote of a Parliamentary Committee could be legally binding for the German Government. We'll have to wait and see; in particular it might be that the Danish Government tomorrow will decide to obstruct the approval of the political agreement as reached in May 2004 even without being legally bound by the vote of the Committee.
Anyway, the risk is that if the substantial discussion on that topic is re-opened the EU Council might finally conclude another political agreement coming much closer to the demands of the anti-patent campaigners. The stakes are very high, on both sides.
What do the various anti-patent groups mean when talking of "software patents" which should not be allowable throughout Europe? From my knowledge gathered by closely watching those groups on the Internet I am inclined to say that, in the perspective of the anti-patent campaigners, every patent which can theoretically be used to successfully sue someone who is commercially tinkering with software qualifies as a "software patent".
I would like to call this approach "Stallman's Utopia": If someone (like Mr. Stallman, the creator of the famous GNU GPL copyright license for F/OSS software) is fighting for a world where no patent is ever granted which is potentially enforceable against anybody commercially tinkering with software, then he or she would have to advocate a ban on patents not only on computer-implemented inventions but also on computer-implementable inventions.
The current Draft Directive in the version preferred by the EU Council (taken by the political agreement of May 2004) clearly is incompatible with any kind of such "Stallman's Utopia": It allows the grant of patents which can be enforced against people who are, under certain circumstances, tinkering with software.
However, amongst patent experts it is commonly agreed that a patent can be enforced against someone commercially tinkering with software even if no "software as such" is patented: On the left hand side of the legal patent equation, i.e. on the side of the patentable subject-matter, we ever have an "invention" out of the realm of the intangibles. On the right hand side of the legal patent equation, i.e. on the side of the enforcement, we have real-world people barred from doing something with tangible real-world objects, e.g. barred from tinkering with a computer having a certain software running thereon. And, we have the doctrine of "contributory infringement", i.e. even if not all features of a patent claim are embodied in a certain real-world situation, there might be (under some additional restrictive circumstances) be a case of a patent infringement. And, don't forget the doctrine of equivalencies. In the effect, the enforcement on the right hand side can be directed against some wrongdoing that is not trivially identifiable on the left hand side where the patented invention is defined in terms of the claim language.
So I think it is a feature, not a bug, of the patent system that despite the fact that the Draft Directive in the version of the EU Council does not allow "software as such" on the left hand side of the equation, the enforcement on the right hand side can potentially well go against infringes tinkering with software in a commercial environment. But in this sense, the experts from the EU Council as well as from the pro-patent industries are right in insisting that the current Draft Directive in the Council's version does not permit "software patents" in the sense that patented subject-matter is software as such. However, on the other side, if the anti-patent campaigners say that they oppose the EU Council's Draft Directive just because they think that they can be sued on the basis of patents on computer-implemented inventions when commercially tinkering with software, their complaints would be more coherent if they would state this more expressis verbis.
What has happened since years is that politicians are lobbied by the various anti-patent groups saying "we do not want to have software patents". Then the politicians go to the patent experts and receive an advice to the effect that such-and-such wording of the law "clearly does not allow software patents" in the sense that the patentable subject-matter will never include "software as such". With this message the politicians again turn to the anti-patent activists, getting an angry response: "See here, there and there, the claims talk of software, and some guys are sued because of they have commercially tinkered with software". As most politicians are not IP Law experts, they get really confused of this.
But the fuzziness of the language of the anti-patent lobbyists clearly has a tactical aspect: If they would stand up clearly demanding "We insist that the patent system is crippled in a way that nobody can ever be sued on the basis of a patent when commercially tinkering with software", then one or the other of the involved politicians might start thinking and understand the enormous consequences of such proposal. So, many activists might prefer to talk about banning "software patents", provoking a misleading impression that such amendment of the law would be something like a limited reform of the patent system.
It would surely not be anything like a limited reform: Each and every act of information and signal processing can in theory be done by a von Neumann general purpose computer embodying a Turing Machine. This is what the term "computer-implementable invention" means: Any invention potentially suited to be embodied by means of a computer. So, implementing Stallman's Utopia means that each and every patent claim would have to be scrutinised whether or not it can potentially be embodied by means of a computer, throwing out every claim entirely consisting of features which, if taken together, can potentially (i.e. by their functionality) be embodied by means of a computer plus software. For example, if a feature says that a "low pass filter" is placed in a signal path, this feature would clearly be "computer-implementable" because of a low pass filter can be implemented not only by means of a network of capacitors and resistors but also by means of a computer equipped with analogue-to-digital and digital-to-analogue-converters. In the context of "Stallman's Utopia", the patent system would be reduced to mechanical engineering, electrical high power systems (where the electrical current does not transport information but merely energy) and chemistry including biotechnology.
Not very surprisingly, larger parts of the industry are not amused by any prospect to see the patent system reduced to ashes this way. And, most of the politicians might perhaps no longer be inclined support the anti-patent campaigners if they could clearly understand these consequences. Implementing Stallman's Utopia throughout Europe would be irresponsible and simpleminded.
But it seems as if for the anti-patent lobbyists the time for researching the basic concepts of patent law and adapting their campaigns accordingly has passed by. They are not interested in any of such discussions. They have since long switched over to something like a political "brute force" approach to win the so-called "patent wars" by all means, in particular by endlessly repeating their misrepresentations, as well as by utilising their sheer numbers as a political leverage.
There seems to be a formidable institutional crisis between the EU Council, the EU Commission, and the European Parliament, the crisis triggered and fuelled by the ongoing political row over the Draft Directive on the patentability of computer-implemented inventions. Under the funny title "Computerised inventions: the Commission refuses to budge" the EUROPARL News Report says:
"[...] Parliament's Conference of Presidents held talks on Thursday with Internal Market Commissioner Charlie McCREEVY on the draft directive on the patentability of computer-implemented inventions. Mr McCreevy was there to explain why the Commission is refusing to resubmit its directive for a new first reading, as Parliament has requested.
EP President Josep BORRELL opened the meeting by stressing that, while the Commission was entitled to reject a request for a new reading by Parliament, under the Treaty it must inform Parliament of the reasons for its decision, 'which the Commission neglected to do'.
Mr McCreevy explained that the Commission preferred to stick with its existing text and await the outcome of the Council meeting of 7 March so as to avoid 'changes which might lead to some chaos' in the procedure. The Commissioner pointed out that, at second reading, Parliament would be able to reject or amend the Council's common position. The Commission would then have to adjust its position accordingly. He also said that, if the Member States were unable to reach agreement on 7 March, it would be up to the Council to decide what to do next. 'It is the Council that will have a problem, not us or you', he said.
Following speeches by the political group leaders, Mr Borrell formally noted the Commission's position. As to the next steps, he agreed that Parliament would have the opportunity to react at second reading to the Council's common position, 'assuming there is one'. He added that Parliament would have to draw conclusions from this situation, particularly with regard to the interinstitutional agreement on relations between Parliament and the Commission, and said 'We will see how we administer the future". [...]'
"[...] The Danish Minister of Economic and Industry Affairs Bent Bentsen has been obliged by the Danish Parliament EU Committee to reopen the software patents discussion in the EU Council of Ministers. Therefore, the directive cannot be adopted as an A-item (formal point) at the Competition Council meeting on Monday. [...]"
But I think that it is still absolutely open whether or not Mr. Bentsen (or anybody else representing Denmark) will actually comply. There are also other reports expecting that on Monday March 07, 2005 the EU Council eventually will formally adopt the political agreement as of May 2004. It remains open. Monday night we shall know more ...
"[...] Conservatives have been keen to ensure that the interests of all parties are taken into account and that a workable and effective proposal is agreed. Conservative MEPs, at the First Reading in the European Parliament, supported many clarifying amendments. An extensively revised text has now been presented for Second Reading. In our view, it is a significant improvement over the original and makes it absolutely clear that a "computer program, as such, cannot constitute a patentable invention" to quote the new text. It also states that "inventions involving computer programs, whether expressed as source code, as object code or in any other form, which implement business, mathematical or other methods and do not produce any technical effects beyond the normal physical interactions between a program and the computer, network or other programmable apparatus in which it is run shall not be patentable".
Based on our initial evaluation, we do not feel that the Directive needs major amendments. Any extension of the scope of patentability could render it unworkable and make it incompatible with national patent law. We want a Directive that will effectively safeguard the European economy against patents on pure software and business methods, while preserving a balanced patent regime that will protect innovators and encourage innovation. [...]"
From the FFII e.V. we also learn that Philips is supporting the EU Council's version of the Draft Directive on computer-implemented inventions:
"[...] Philips supports the patentability of all technical inventions and is no proponent of excluding inventions with software. According to Philips, inventors in all sectors need patents to protect their inventions to provide for incentives and financial means and to promote a transfer of technology. Inventions with software are no exception to this rule.
The latest draft directive of the EU Council of Ministers (May 2004) takes into account all interests. Trivial patent applications and applications for patents on pure software, feared by opponents of software patents, are not accepted by this directive. Philips squarely supports attempts to quickly eliminate trivial patents. As in all other economic sectors, patents on inventions which contain software will only be granted if the invention provides a technical solution which is new, non-obvious and industrially applicable. [...]
The draft directive of the Council follows the current practice of the EPO and will increase the harmonisation and legal certainty in the field throughout Europe. If the patentability of inventions with software is removed, this has serious consequences for the competitiveness of Europe and as such also for future employment. It would damage the ability of enterprises to finance research and development. After all, tech-enterprises increasingly use their patents to achieve a reasonable return on investment in this field. This return motivates and enables them to continue their enormous research efforts. Europe would become a much less attractive location for research if every software-supported invention can be imitated without financial compensation for the inventor, while the patenting of such inventions is and remains normal in the US and Japan. The 'Lisbon goal' to make Europe the most innovative and powerful knowledge economy in the world by 2010 becomes impossible. Terminating patents on inventions with software would encourage innovative companies to reduce their expenses in so far research and development in Europe is concerned, and move activities to other continents. Many license agreements of European companies will be undermined by the the elimination of patents on inventions with software. Innovative companies such as Philips would suddenly be confronted with a significant decrease concerning the return on their investments in research and development, because a large part of their patent portfolio in Europe would no langer have any financial value. Because of all these reasons, Europe must maintain patents on inventions with software. If we want to reduce the number of trivial patents which inhibit research, there is a much better solution: strengthen the gate keepers. If our national and international patent offices would have more staff, more financial means and better instruments, they would be able to perform their work even better than they do now while separating the chaff from the wheat among the patent applications. Let us not try to solve the problem of trivial patents by simply banning patents on inventions with software. That 'solution' would after all create a much larger problem: serious damage to Europe's knowledge economy and employment. [...]"
Not just surprising that the FFII e.V. has a somewhat different view on such statements ...
"[...] Subject : Proposal for a Directive of the European Parliament and of the Council on the patentability of computer-implemented inventions - Common position - Statement of the Council's reasons
COMMON GUIDELINES Consultation deadline: 04.03.2005
N.B. For reasons of urgency, consultation deadline is shorter than 7 working days."
So what does the Council Secretariat want to tell us with the above-mentioned document? Hectic activity in COREPER? I don't know. Rumors say that the EU Council is determined to formally adopt the May 2004 political agreement on Monday March 07, 2005. But many of such dates have passed by without anything being formally adopted.
Reduction of time delays after issue of the EPC Rule 51(4) communication;
LFO 'B' specification provision;
E-forms provision;
Review of Outstanding Action Points; and
Any other business.
Of particular interest for a wider international audience might be the deliberations concerning a legal expense insurance for patents:
"[...] Sean advised that he had been in discussion with Lawrence Cullen in IPID, who is leading on this issue, (also known as the Patent Enforcement Project (PEP)). Richard Gallafent was a member of the PEP group that produced the final PEP report which proposed a partnership approach to take things forward. Some members of the PEP group felt that a proper Government funded feasibility study should be set-up, others that the Industry could do this. In June 2004, Lord Sainsbury received a submission advising him of the outcome of the PEP and the suggestion of a partnership approach. Paul Leonard, Director of the Intellectual Property Institute (IPI), had chaired a round table meeting in September 2004 and the conclusions drawn from it were that the IPI would organise a seminar to discuss patent litigation insurance including 'what is the risk of not having it' and 'what is needed to meet this risk'. The seminar will be held in March 2005. The Patent Office was looking at possible models such as a mutual insurance scheme with the involvement of the insurance industry and was keen to take the project forward.
Andrew commented that he would like to attend the March meeting and it was agreed that CIPA should be kept involved.
In reply to questions from Luc, Sean confirmed that the focus was on patent litigation insurance and not IP insurance generally. The insurance industry would be encouraged to recognise that there was business here but a model would not be imposed upon them. Sean thought that the focus was currently on a UK based scheme.
Richard commented that at the March seminar risk management was to be discussed which was a very well developed area within the insurance industry but it was not an area where the market was transparent. A seminar that concentrated on this may miss the point of the need for insurance to cover litigation costs. [...]"
So, I'm quite curious to learn how the British will go ahead with regard to this important project ...
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Dipl.-Phys. Axel H Horns is Patentanwalt (German Patent Attorney),
European Patent Attorney as well as European Trade Mark Attorney. In particular, he is Member of: