New Zealand is more or less antipodal to where I live, and I don't have any contacts down under. That makes it harder to comment, but by now I believe to have gathered enough information to be comfortable with expressing my view of the situation there.
I've come to the conclusion that it's too early to tell what the outcome will be, and I'll explain the different directions in which things might go, and why.
Believe me: substantive patent law is a very complicated matter, and it takes a lot of specialized knowledge -- not just common sense -- to figure things out properly. Hartmut Pilch, the founder and former president of the FFII, is a true expert in that field. We worked together closely. Initially, my NoSoftwarePatents campaign was independent from the FFII but coordinated many activities with Hartmut's organization. Later, I handed the campaign website to the FFII. Hartmut and I know how resilient software patents are, and we concur that the abolition of software patents in New Zealand is far from certain at this stage. I quote Hartmut on the New Zealand situation further below. In order for his insightful comments to be understandable, I have to provide some background.
Jubilant abolitionists and a minister being a typical politician
On 15 July, the two New Zealand organizations leading the fight against software patents cheered an announcement by New Zealand commerce minister Simon Power that a patent reform bill containing a general exclusion of software patents should pass without further amendments:
- The New Zealand Open Source Society (NZOSS) wrote:
"Minister Announces No Software Patents"
- The New Zealand Computer Society (NZCS) announced:
"It's official: Software will be unpatentable in NZ"
If I saw only that headline, especially the word "for" in front of "software patents", I would expect the text below to be a ringing endorsement of software patents. That headline certainly doesn't announce a state of no software patents at all. Much to the contrary, the first paragraph says:
"Commerce Minister Simon Power has instructed the Intellectual Property Office of New Zealand (IPONZ) to develop guidelines to allow inventions that contain embedded software to be patented."Again, that doesn't sound like the door is closed. IPONZ is New Zealand's patent office, which after the parliamentary process will get to work out the details of what is and what isn't patentable there.
The process so far
New Zealand is overhauling its patent law. The law presently in force is the Patents Act of 1953. Within the New Zealand Parliament, the Commerce Committee took the lead on the new patent bill, which was presented by the country's government in July 2008. The Commerce Committee discussed controversial issues, such as software patents, with stakeholders. On 2 April 2010, the Commerce Committee amended the government bill and presented its first-reading report (HTML, PDF).
The key passage related to software patents is Article 15 para. 3A:
(3A) A computer program is not a patentable invention.For the proponents of software patents, this straightforward exclusion went too far. According to the software patent wiki, they convinced New Zealand commerce minister Simon Power that instead of that exclusion the law should be modeled after the European Patent Convention (EPC). The EPC, too, excludes computer programs from the scope of patentable subject matter, but only "as such". Some background on the way the European Patent Office and European courts interpret an exclusion of software as such is contained in this earlier blog posting.
A New Zealand blogger (who set up New Zealand's first government web server back in 1995) called the reactions of the pro-patent camp "disingenuous."
Temporarily the abolitionist camp was worried that the legislative proposal could still be changed. Therefore, it's understandable that NZOSS and NZCS celebrated the commerce minister's announcement that he and the parliamentary committee agreed to pass the bill unchanged. It seems that the opposition to software patents that two leading New Zealand software companies -- Orion Healthcare and Jade Corporation -- mounted played an important role.
So what's next down under?
The New Zealand Herald interpreted Minister Power as saying that "[g]uidelines rather than a law change will be used to allow inventions that contain embedded software to be patented."
In other words, the law will contain an exclusion of software patents, but the national patent office will draw up guidelines that will allow patents on inventions containing embedded software.
The law is broad and general. Many may believe that it would be sufficient to simply say "a computer program is not a patentable invention" in a law. Wrong. The biggest issue in substantive patent law is line-drawing. We as programmers may have a clear idea of what a "computer program" is, and what it is not. But when a patent application gets filed, the word "computer program" may not appear in it at all, even though computer programs could infringe a patent that would be granted on such an application. The patent claim (the scope of the patent) can be an "apparatus" or a "method". It doesn't have to say "computer program" at all.
So what is "embedded software" and inhowfar is it different from a computer program? That will now be the subject of much discussion in New Zealand, I guess. The commerce committee's bill says in its footnote 4:
Embedded software is computer software which plays an integral role in the electronics it is supplied with (e.g. cars, pacemakers, telephones, and washing machines).Note the word "telephones"! Today's smartphones are pretty powerful and functional computers. The software that plays an integral role in running them isn't too different (in terms of operating systems, programming languages etc.) from the software running on a server or a desktop PC.
So the New Zealand patent office (IPONZ) will have to come up with guidelines that enable patent examiners to make a distinction between "computer program" and "embedded software", with the latter even including the software powering smartphones.
What does this mean in practice? Let me give an example: if someone filed a patent application for an "apparatus for the storage and retrieval of contact data", the patent office might grant the patent because this would be a typical smartphone application (every smartphone comes with an address book). But the patent claims could ultimately also read on an address book program for a personal computer.
Some may think it doesn't matter to programmers and software distributors because they can never infringe such a patent. Actually, they can: the legal theory is called "contributory" or "indirect" infringement. The idea is that the infringement as a whole requires hardware and software. But if the software plays an essential role in it, then publishing and selling such software would be a contributory (indirect) infringement of the aforementioned device patent. In practical terms, a contributory infringement comes with pretty much the same negative consequences as a direct one: the patent holder can seek an injunction and indemnification even against an indirect infringer.
So those guidelines are now critical. The law is the law, but it's not detailed enough for patent examiners to work with. The guidelines will determine the daily work of the patent office there. IPONZ will have to be careful in designing those guidelines because ultimately a court could determine that certain patents go against the law. The guidelines won't have the status of a law. A court will review the decisions taken by IPONZ (if applications or third parties appeal those decisions) and will then decide, case by case, whether the patent office interpreted the law correctly. Over time that would provide more clarity.
This means that it may actually take a number of years before it's clear whether or not New Zealand allows software patents. The IPONZ guidelines will certainly give an indication as to what that authority plans to do. Still it will remain to be seen exactly how the guidelines are applied, and what the courts ultimately say.
I have to repeat it: that law isn't clear. Not even with the straightforward exclusion of software patents. It says that a computer program isn't a patentable invention. It doesn't say that methods that could be implemented in or by a computer program -- as well as in other forms, such as hardware -- aren't patentable. For the reasons I explained above, those are different things.
If you define a software patent as a patent on software (and only that), the law will probably take care of that problem. But a more pragmatic definition is that a software patent is a patent that can be infringed by software developers, publishers and users. The New Zealand bill doesn't take care of that question. This will depend on the guidelines and, ultimately, the courts.
How could they draw the line? The problem is that this can't be fine-tuned like the fishing quotas that two countries negotiate. It's a pretty polarized situation where there's either a far-reaching exclusion that abolishes large parts of the entire patent system, or you get, like in Europe, an exclusion on the surface that ultimately results in patents that read on software, even if those patent applications may be phrased in a way that doesn't suggest so to a layman.
Both approaches are possible outcomes when the objective is to distinguish "computer programs" from "embedded software":
- The abolitionist approach would be to accept patents on devices containing embedded software only if the technical contribution of the invention relates to an advancement in an applied natural science. For an example, a car brake controlled by a computer may use an algorithm to computate the most efficient use of the available braking power based on road conditions. Under a restrictive regime concerning software patents, the device as a whole would be patented only if the computer-controlled car brake uses what experts call "controllable forces of nature" in an innovative way resulting in a shorter braking distance. A better memory management algorithm within the car brake's controlling software would not be considered patentable.
- The liberal approach would also consider software running on a standard computer to be "embedded." In other words, as long as the software is outside the computer on some medium, it's considered software -- once you actually run it on a computer, the device as a whole could under certain circumstances be considered a technical invention containing embedded software. Also, this raises the question of whether operating system software is embedded software by definition (especially when considering that smartphone and PC operating systems are slightly different variants of general-purpose operating systems).
At the start of this I mentioned Hartmut Pilch, the founder of the European anti-software-patent movement. When he saw a mutual friend of ours declaring (on his Facebook wall) victory based on the first reports from New Zealand, Hartmut wrote the following comments (which he authorized me to quote, with a clarification he later inserted):
"They will have to watch this very closely and we too. The backlash of the patent mass-producer lobby will be enormous and the opportunities for [IPONZ] and courts to misunderstand or otherwise dodge the lawmaker's instructions manifold.TRIPs is the international Agreement on the Trade-Related Aspects of Intellectual Property Rights, and it requires patents to be "available for any inventions, whether products or processes, in all fields of technology, provided that they are new, involve an inventive step and are capable of industrial application."
One obvious way for the patent lawyers to twist the new law will be to interpret it as a call from the lawmaker to follow European i.e. EPO examples, with the added (false but effective) argument that TRIPs doesn't allow anything else."
As you can see, the devil is in the details. I'll continue to watch the process and will comment on it again sooner or later.
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