9 Sept 2014: Is a business method patentable?

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Under Australian patent law, there is no statutory position on whether a business method is patentable subject matter, and so it is legal precedent that provides guidance.

The watershed NRDC[1] case opened the door to what can be considered patentable subject matter in Australian law, to beyond merely ‘vendible products’[2],  and now includes things such as living organisms, genetic materials, computer software and methods of treating humans.

Those principles were applied in the 2006 case of Grant v Commissioner of Patents[3] which involved a method for restructuring financial trusts to the benefit of members.  In denying the patent, the Full Court said that the patent must results in some kind of physical phenomenon or transformation in order to be patentable.  In this instance, as there was no physical effect or application, the patent was not allowed.  The case is relevant in that it qualifies the broad NRDC by requiring some physical effect to be brought about by the patent.

The policy of IP Australia is to treat business methods like any other subject matter, in that they are not specifically excluded so long as they meet all the other requirements of patent law.[4]   In summar, the current position of business methods as patentable subject matter in Australia is that a business methods may be patentable long as it has some physical phenomenon or manifestation.

In regards to the legislature making a statement on this rather than the judiciary, a 2003 review[5] by Australia’s Advisory Council on Intellectual Property of the appropriateness of patenting business methods which found it may not be desirable said the issue was not significant enough to warrant a change to Australian patent law.  So a legislative statement any time soon look unlikely.

[1] National Research Development Corp v Commissioner of Patents (1959) 102 CLR 252; 1A IPR 63 at CLR 275; IPR 74 (High Court of Australia)

[2] As ruled under Morton’s Rules.

[3] Grant v Commissioner of Patents [2006] FCAFC 120

[4] See para 2.9.2.10 of the IP Australia Patent Examiner’s Manual

[5] Australia’s Advisory Council on Intellectual Property, Report on a Review of the Patenting of Business Systems, September 2003

September 9th 2014 |

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