Netherlands Pays-Bas Niederlande. Report Q 158

Transcription

1 Netherlands Pays-Bas Niederlande Report Q 158 in the name of the Dutch Group by K.A.J. BISSCHOP, B.J. van den BROEK, L.D. BRUINING, W. HOORNEMAN, H.V. MERTENS, L. OOSTING, T.F.W. OVERDIJK, R.J. PETERS, W.E. PORS, A.H.K. TAN (chairman), J.J.H. Van KAN The patentability of business methods I. Introduction II. The legal situation in the country II.1 The question of the patentability of business methods cannot be isolated from the problem of the protection of intellectual and abstract methods. The groups are therefore invited first of all to indicate the exclusions from patentability, as provided for by the law of their country, based on the abstract nature of the invention: - statutory exclusions; - and exclusions arising from case-law. If intellectual and abstract methods are excluded from patentability, the groups are invited to give details as to the basis of this exclusion. Introductory remark In the Netherlands two separate Patent Acts are currently in force, i.e. the Patent Act and its successor the Patent Act In short, the Patent Act 1910 is still applicable to patent applications which were filed before the entering into force of the Patent Act 1995 (April 1, 1995), and to patents granted pursuant to those applications. The above question will be answered under both the Patent Act 1910 and the Patent Act Law of 7 November 1910, Stb Law of 15 December 1994, Stb. 1995, 51. A number of the provisions of the Dutch Patent Acts (e.g. with regard to patentable subject matter and the requirements for patentability) correspond to these of the European Patent Convention, to which The Netherlands is a Member-State. This report will focus on the applicable provisions of the Dutch Patent Acts. The corresponding provisions of the European Patent Convention and the interpretation thereof by the bodies of the European patent Office will not be dealt with in detail in this report. 1

2 Patent Act 1910 Statutory exclusions of intellectual and abstract methods The Patent Act 1910 provides that a patent is granted for the invention of a new product or process, which is not obvious for a man skilled in the art and which is susceptible of industrial application, including application in the field of agriculture (Articles 1A, 2A and 3 Patent Act 1910). The Patent Act 1910 does not contain specific statutory exclusions of patentability with regard to intellectual and abstract methods. The only statutory exclusions of patentability contained in the Patent Act 1910 are exclusions for i) plant strains or animal breeds, ii) methods of an essentially biological nature for the production of plants or animals, except microbiological methods and products produced through application thereof, and iii) products or processes of which the disclosure would be contrary to public order or public decency (Articles 3A par. 2 and 5 of the Patent Act 1910). Although not specifically stipulated, it is generally held that the statutory exclusions relating to abstract methods contained in the European Patent Convention and the Patent Act 1995 (see below) are also applicable under the Patent Act In the Explanatory Memorandum to the Patent Act 1910 it is specifically stated: "Some laws find it necessary to exclude from patentability plans and combinations for financial and credit-operations (such as the French and Spanish laws), others exclude scientific theories (such as the Austrian, Hungarian, Italian and Russian laws). All these exclusions are superfluous if one takes into account, that the invention should lie in the field of material production. Theories of abstract science, financial combinations, educational rules, hygienic lifestyles, healing operations are therefore automatically excluded form patentability." Exclusions to patentability arising from case law In practice - although not specifically excluded by statutory provision - abstract methods were excluded from patentability by interpreting e.g. the term "processes" under the Patent Act 1910 as excluding such abstract methods. On January 20, 1950 the Supreme Court ruled with regard to an abstract method of broadening a narrow street that this method could not qualify as a patentable process because through the method no change in nature was accomplished. 5 The Supreme Court held: "a "process" within the meaning of this specific provision (of the Patent Act) should be considered as a manner of human activity through which a change in nature is accomplished (..)" In 1982, the Patent Office decided that merely a new understanding (of technical matters) which does not lead to new technical activity is not patentable See e.g. the Explanatory Memorandum to article 2 of the Patent Act Hoge Raad 20 January 1950, NJ 1950, 274. OR 15 April 1982, BIE 1983, 24. 2

3 Patent Act 1995 Statutory exclusions of intellectual and abstract methods The Patent Act 1995 contains a non-limitative list of statutory exclusions which corresponds to article 52 paragraph 2 of the European Patent Convention. This list has been specifically included in the Patent Act 1995 for reasons of harmonisation. Article 2 of the Patent Act 1995 provides: 2.1 Patentable are inventions which are new, inventive and which are susceptible of industrial application. 2.2 In particular the following are not regarded as inventions in the sense of paragraph 1: - discoveries, as well as theories of natural science and mathematical methods; - aesthetic designs; - systems, rules and methods for the performance of spiritual labour, for playing or for doing business, as well as computer programs; - presentations of data 2.3 Paragraph 2 only applies insofar it relates to the subjects or activities mentioned therein as such. The Patent Act 1995 also contains exclusions for inventions of which the disclosure would be contrary to public order or public decency, as well as for plant strains or animal breeds, and methods of an essentially biological nature for the production of plants or animals, except microbiological methods (article 3 Patent Act 1995). Exclusions to patentability arising from case law There is no case-law in which additional exclusions based upon the abstract nature of the invention are given. II.2 Are business methods patentable or, on the contrary, are they excluded from patentability in the legislation of your country? Under the Dutch Patent Act 1995, article 2, paragraphs 2 and 3, "systems, rules and methods (...) for doing business" as such are excluded from patentability. This exclusion corresponds literally to the exclusion of business methods according to article 52 paragraphs 2 and 3 of the EPC. There is no Dutch case law interpreting the scope of the exclusion. However, a further differentiation is to be made according to the following question. II.3 If business methods are excluded from patentability, does this exclusion concern only the methods in themselves, or does it also apply to any invention applying business methods? The exclusion from patentability of business methods only concerns the methods as such, which follows clearly from the wording of article 2, paragraphs 2 and 3 of the Patent Act

4 There is a general consensus that this exclusion is to be interpreted narrowly, in line with the interpretation of the similar exclusion contained in article 52 of the EPC. Further, it is generally held that for the examination of the patentability of a business method invention, the criteria which are applicable to European patent applications/patents, also hold true for Dutch patent applications/patents. Consequently, in line with the requirements set by the EPC and the Implementing Regulations to the EPC, and further requirements developed by the Boards of Appeal 7 of the European Patent Office, in the Netherlands any invention applying a business method may thus be patentable as long as the requirements of articles 2, 7 and 25 of the Dutch Patent Act 1995 (corresponding to articles 52, 57 and 83 of the EPC) are met, the invention has a "technical character", and - in the case of a business method implemented in software - the invention produces a "further technical effect" 8, notwithstanding the fact that the Dutch Patent Act 1995 comprises no provisions in accordance with rules 27 and 29 of the Implementing Regulations to the EPC. Furthermore, a mix of features, some of which are excluded under article 2 of the Dutch Patent Act 1995, and some of which are not excluded, may be patentable. II.4 If business methods are not patentable, are there other means of protection of business methods, particularly copyright? Copyright In copyright law, it is generally accepted that ideas are not protected, irrespective of their novelty, inventiveness or commercial potential. 9 Ideas which have been developed into a concrete "concept" or a "plan of approach", however, are considered as a "work" within the meaning of the Copyright Act The threshold which must be met, is that the concept or plan of approach has its own, original character and bears the stamp of the creator s personality. 10 If these criteria are met, business methods could be protectable under the Copyright Act. An analogy may be drawn to the field of copyright protection of formats for television programs. In this field, the distinction between the (unprotectable) abstract idea and the (protectable) expression of that idea, has been a matter of discussion in several cases. Two of the earliest cases in this field are concerned with two game shows called "Talkabout" and "La Chasse" respectively. In the first case, 11 the President of the District Court of Amsterdam ruled that the game, which is described in detail in the decision, should be regarded as a "work" in the sense of the Copyright Act 1912 and therefore deserved copyright protection. The President admitted that the game contained certain elements which were also used in other games, but added that because of the manner in which these known elements had been e.g. T769/92, Official Journal EPO 1995, p Sohei. T1173/97, Official Journal EPO 1999, p Computer program product/ibm. See for instance J.H. Spoor and D.W.F. Verkade, "Auteursrecht", 1993, par. 44, with reference to (extensive) case law. For instance: Hoge Raad 29 November 1985, NJ 1987, 880; Hoge Raad 4 January 1991, IER 1991, p. 96. Pres. Rb. Amsterdam 15 November 1990, AMI 1991, p. 70 ("Talkabout"). 4

5 developed, joined and combined with an original element, the game had its own personal character, and was eligible for copyright protection. In the second case, the President ruled that the idea of the television program of claimants had been given such a shape that it was a "work" in the sense of the Copyright Act In the proceedings on the merits which followed, the District Court agreed with the opinion of the President that the format of the program of claimants was protected by copyright. 13 The Court of Appeal ruled that a concept or plot of for example a television series could be developed and given shape in such a way that it was to be considered a work in the sense of article 1 of the Copyright Act It added that this shape should be original. 14 It follows from these cases that although the underlying idea for a television program remains in the public domain, copyright protection has been granted in the event the format in which this idea is expressed, is sufficiently developed / concretised. The fact that the format (mainly) consists of known elements does not seem to bar this protection; the selecting and combining of known elements and adding of one or more new elements thereto, can be sufficient to give the format the required "personal character". 15 Even if all elements of a format are, individually, not original, the combination of these elements may be protectable. 16 There are also cases in which copyright protection has been denied, but none of these cases seems to show a principal denial of the possibility that formats can be protected through copyright law. 17 It appears from case law that the scope of protection offered by copyright to television formats is very limited. If only some elements of the format are changed, it is often found that the program that was thus created, does not infringe upon the copyright of the maker of the copyrighted format. 18 Besides formats for television programmes, some other decisions in Dutch case law also seem to support the possibility of protecting business methods under copyright. Again, the underlying idea cannot be protected, but the concrete form in which this idea has been given shape, can. Reference is made to a decision of 1990, 19 in which the President of the District Court was asked to decide about a marketing campaign in which customers could claim back 100% of the purchase price of a good bought before a certain date and above a certain price, provided that they would do so exactly 10 years after purchasing the good. The President ruled that the idea of using a "money-back-offer" as a marketing tool, was Pres. Rb. Amsterdam 15 November 1990, AMI 1991, p. 71 ("Op Jacht naar de vos I"). Rb Amsterdam 17 January 1991, AMI 1991, p. 71 ("Op jacht naar de vos II"). Hof Amsterdam 3 March 1994 AMI 1995, p. 54 ("Op jacht naar de vos II"). See also Gerechtshof Amsterdam 25 June 1987, AMI 1988, p. 60, in which the Court of Appeals stated: "the ideas which are used in the television format of 13 may 1986 have not, or insufficiently, been developed (concretised) to be eligible for copyright protection". In Pres. Rb. Amsterdam 23 January 1992, AMI 1992, p. 112, The President of the District Court ruled: "it is not impossible for an idea for a program to be eligible for copyright protection provided that it is sufficiently developed and concretised". Arrondissementsrechtbank Amserdam 7 June 2000 (case number H , not published) ("Big Brother"). J. Haeck gives an extensive overview of Dutch and foreign decisions concerning the eligibility of copyright protection of program formats in his dissertation "Idee en programmaformule in het Auteursrecht", 1998, pages See also J.C.H. van Manen, "Televisieformats en -ideeën naar Nederlands recht", 1994, who discusses several Dutch and foreign decisions in this field. This was e.g. the case in the decisions mentioned above in footnotes 1-3 as well as in the decision of Pres. Rb. Amsterdam of 27 May 1999 ("De jongens tegen de meisjes"). Pres. Rb. Haarlem 17 December 1990, BIE 1992, p

6 not eligible for copyright protection, as this would come down to granting protection to the idea itself, which is in the public domain. The development of the idea into a "concept" or "plan of approach" was considered an achievement which should be considered as a "work" in the sense of copyright. In another case, the President of the District Court of Haarlem seems to hold the view that - although not in that specific case -copyright protection could be granted to the "formula" of magazines. 20 Tort Another possible instrument of protecting business methods, would be through the law of unfair competition. In the Netherlands, unfair competition can be fought through article 6:162 Civil Code, being the general article on tort. It has been suggested in the past that this provision should offer a solution (in the form of protection) for "sweat of the brow" achievements, i.e. achievements which are the result of the blood, sweat and tears of the creator. 21 The possibilities of protection business methods (or any other achievement) by the law of unfair competition seem to be extremely limited, however. In the decision Holland Nautic/Decca, 22 the Supreme Court ruled that courts should be very reserved in assuming that an achievement which is not protected by intellectual property rights, should be protected by the general law on tort. However, the Supreme Court stated that profiting from the achievement of a third party may be tortuous if this achievement "is of such a nature that it could be put on a par with those achievements which justify granting of such a right" [i.e. an intellectual property right]. Additional circumstances have to be proven in order for such profiting to be tortuous. In the specific case (relating to a navigation system), the Supreme Court ruled that the actions of defendant were not tortuous. Attempts have been made in case law to obtain protection for achievements which are not protected by intellectual property rights. It appears, however, that courts interpret the Holland Nautic/Decca decision in a very restrictive manner. In a decision of 1991, 23 the President of the District Court in The Hague held that the mere imitation of the marketing strategy of claimants was not tortuous, as (i) the claimant did not possess an exclusive right relating to that strategy, and (ii) the strategy could not be regarded as an achievement of such a nature that it could be put on a par with those achievements which justify the granting of such a right. The President added that the principle of freedom of commerce implies that a competitor does not act tortuous by imitating methods from others. This could only be different if this would confuse the public. In a case relating to the "concept" of candy stores, the President of the District Court in The Hague ruled that as the concept was not protected by intellectual property rights, granting an injunction implied that the achievement of claimant would be protected in a Pres. Rb. Haarlem 17 May 1988, BIE 1992, 64, with critical comment of S. Boekman, who states that the formula of a magazine, meaning the genre, belongs to the field of thoughts and ideas which should be free (from copyright protection). See references in Van Manen, a.w., page 56. Hoge Raad 27 June 1986, JN 1987, 191. Pres. Rb. 's-gravenhage 7 March 1991, BIE 1992/26. 6

7 manner which did not differ much from the protection it would have received in case it did possess an intellectual property right. Implicitly referring to Holland Nautic / Decca, the President stated that it should therefore be very reserved in offering protection on the basis of tort. 24 II.5 If business methods are patentable, is there a distinction in the grant of protection between business methods used in the context of tradition at business and business methods used in the context of the Internet? Basically, there is no distinction in the grant of protection between traditional business sectors and business methods used in the context of Internet. In business methods in general, and in Internet business methods in particular, the territoriality of patents might give rise to problems in the enforcement thereof due to part of the invention being performed in one jurisdiction, and part of the invention being performed in another jurisdiction. II.6 If business methods are patentable in the country, have the national courts already had the occasion to decide on the extent of the protection conferred by patents concerning such methods? In the affirmative, have the Courts applied specific rules or, on the contrary, the normal rules governing the patent system? No decisions are available. III. Opinion of the groups After having set out the legal situation in their country, the groups are invited to give their opinion on the following questions, giving reasons for their point of view each time. III.1 Do the groups consider that business methods, as defined above (see I (f)), taken in themselves, constitute inventions? It should be noticed, that it is the understanding of the group that (the definition of) an invention is not the same as (the definition of) a patentable invention. In the opinion of the group, an invention could be defined as a new and inventive solution to a problem. Business methods (in themselves) may be also covered by this definition. III.2 In the opinion of the groups, is the exclusion of patentability for business methods in conformity with the provisions of Article 27 of the TRIPS agreement? Article 27 section 1 of TRIPS provides that patents are granted for inventions in all fields of technology. Sections 2 and 3 contain an extensive list of possible exclusions. As far as methods are regarded, article 27 section 3 sub a only enables the exclusion of diagnostical, therapeutical and surgical methods, not of business methods. On the other hand TRIPS only requires that patents are granted for inventions in fields of technology. 24 In two other decisions concerning candy shops (Pres. Rb. Groningen 3 July 1987, BIE 1988/67 and Pres. Rb. Roermond 17 September 1987, BIE 1988/68), the Presidents of the Groningen and Roermond District Courts held that claimant could prevent others from using its concept ("lay-out", "formula") on the basis of tort, bud did not seem to pay attention to the Holland Nautic/Decca decision. The decisions have been criticized in literature. 7

8 Article 52 of the European Patent Convention and article 2 of the Dutch Patent Act 1995 exclude business methods "as such" from patentability. The question therefor is what interpretation of the "as such" clause would still be in conformity with TRIPS. If a broad interpretation of business methods "as such" would be used, this would mean that in fact an exclusion would be applied, which is not allowed under article 27 section 3 TRIPS. If a narrow interpretation of "as such" would be used, for instance only excluding inventions for business methods that are not in any field of technology, this would still be in conformity with TRIPS. As the European Patent Office is of course aware of the implications of TRIPS, it is to be expected that the European Patent Office will adopt a narrow interpretation of the "as such" clause in order to avoid violation of the TRIPS obligations. A further indication for such a policy is that the European Patent office has recently demonstrated that they like to act in conformity with supranational law, when they adopted the Biotechnology Directive of the European Union as part of their rules for granting patents. Case law of the Dutch national courts already shows that the courts want to remain within the limits of the TRIPS obligations, even in those cases where it is not clear that those obligations are directly enforceable without being incorporated into national law. 25 It is therefor likely that the Dutch national courts will also adopt a limited interpretation of "as such" that seems in conformity with article 27 TRIPS. III.3 If national legislation does not currently provide for the possibility of protecting business methods, taken by themselves, by invention patents, do the groups think that their patentability is desirable? The group is of the opinion that patentability of business methods is desirable for inventions which provide a technical solution for a problem, i.e. if the solution includes technical features of which the function is essential for the invention. The contribution to the state of the art would not necessarily have to reside in these technical features and the effect thereof. However, opinions vary on the question whether or not business methods for nontechnical inventions (which provide a non-technical solution for a problem) should be patentable. Below reasonings against and in favour of patentability of business methods for non-technical inventions are set forth to contribute to the discussion regarding this issue. Reasoning against patentability of business methods for non-technical inventions There are several intellectual property protection systems that have each been specifically designed for their respective subjects. The patent system has been designed for protecting technical inventions. If patent protection would be made available for non-technical inventions as well, the boundaries between the various forms of intellectual property rights would become blurred resulting in a legally unclear situation. 25 There is extensive national case law on article 50 TRIPS, which always states that it is unclear whether this provision applies without incorporation into national law, but in which a reasonable term as meant in article 50 section 6 is always stipulated. 8

9 If patent protection would be possible for non-technical inventions, i.e. for creative nontechnical ideas, then it should also be possible to obtain patents on new (industrial) designs based on non-technical considerations. Broadening the criteria for patentability in order to allow for invention patents for industrial designs for the normal patent term would at least in some countries interfere with the shorter term of protection for industrial designs. In the reverse situation, if it were allowable to make patent protection available for nontechnical inventions, why not make, for example, trademark protection or industrial design protection available for technical inventions? From a viewpoint of a person desiring protection, there is a definite advantage of acquiring a trademark right that may last forever over a patent right that lapses after only 20 years. Yet the exclusion from trademark protection of shapes that are determined by technical considerations, is well accepted. The exclusions in both trademark law and industrial design law for technical matters are just an expression of the generally accepted belief that for such technical matters another intellectual property protection system exists, that is far more suitable for such technical matters because it has been specifically designed therefor. So, it is not just patent law itself that says that patents are for technical matters; both trademark law and industrial design law say this too. Also under copyright law there is an exclusion for protection of aspects of a work, which are necessary to obtain a certain technical effect. From the above considerations it follows that the boundaries of the various intellectual property protection systems have been carefully designed over the past decades, and that one simply should not try to make all intellectual property protection systems available for all aspects of commerce. For patents, technology, novelty, non-obviousness and industrial applicability are all equally important essential features with which one should not mess. Intellectual property rights create to a certain extent a monopoly. In Europe in general, and also in The Netherlands, free competition is protected by competition law. Intellectual property rights constitute a limitation on such free competition. According to constant case law of the European Court of Justice, an intellectual property right can only be construed in order to protect the specific subject-matter of that specific right. This subject matter is different for different types of intellectual property rights. In the Dior vs Evora case of 4 November 1997, the European Court of Justice decided on the scope of protection of a trademark. Although this was primarily a trademark case, the trademark owner also invoked copyright protection. The Court ruled that in such a case, copyright can not offer a broader protection than that which is already offered by the trademark right. This case law indicates that the European Court of Justice only allows limitations on free competition, which are a consequence of the specific subject-matter of an individual intellectual property right, and that each of those rights has its specific subject matter, which is different from the subject matter of other intellectual property rights. This also calls for maintaining the boundaries between the specific subject-matters of individual intellectual property rights, and therefor reserving patent protection for inventions in (all) fields of technology. If one would like to give legal protection for non-technical ideas/innovations, then it could be considered to create a new form of intellectual property right protection with appropriate rules and terms in addition to and separate from the existing forms of protection. 9

10 Such new legal system would have to be introduced on a world-wide basis, because otherwise it would create again barriers for international trade in conflict with the Tripsagreement. Reasoning in favour of patentability of business methods for non-technical inventions Before the broad use of computers and telecommunication, methods of doing business were in the sphere of the intellect. Human skill, organisation and local presence were main determinants for the profitability of such methods, not the scale of commercialisation determining pay-back of substantial investments. This meant that the question whether a new method of doing business would be imitated would typically not have been decisive for the development of such methods. In such a situation, instating a patent system protecting new business methods would indeed not be of much help to support innovation by preventing it from being imitated. For inventions having a technical character, the situation has been different from the onset of the Industrial Revolution. Industrial application of inventions became decisive for earning back the costs of development and to allow for the risk and costs of failure. It will probably not have been by accident that this development was followed by the creation of patent systems, especially in the countries that were leading the Industrial Revolution. That the creation of patent protection for technical inventions was not without problems or discussion is illustrated by the abolishment of patent protection in The Netherlands in 1869 followed by its re-instatement in With the evolution of communication methods and the use of computers, the above - described traditional difference in character between technical and non-technical innovation has started to fade. Before, if you would devise an improved method of bookkeeping, its application would be by teaching it to bookkeepers. Copyright provides a reasonable protection for teaching materials. If the method was applied in machines such as cash registers, the hardware character thereof provided access to patent protection. These days, its application would entail including it in a business information system which requires large investments to develop and of which the profitability largely depends on the number of licenses which can be sold and the price of such licenses. In the past, the application of a manner of displaying guidance on how to arrive at an address would be limited to a person to person interaction including, for instance, skilful drawing on the back of a cigar box. These days it can be an important feature of an automated route guidance system. In both these instances, if the invention is not based on technical considerations it is not patentable where technical character is a requirement. Patentability of computer programs is of no relief if the requirement of technical character still stands. Also in fields less directly affected by information technology and telecommunication, a tendency of relying on earning back large investments by large scale operations can be 10

11 observed. In mass retailing for instance, franchising concepts involve investments in developing a concept, the costs of which must then be earned back by licensing the concept. If such a concept relies heavily on an invention having a useful but non-technical effect, competitors could simply follow after having seen the success of the inventor by copying the essential features and avoiding copyright and trademark infringement by adequate restyling of the copied principle. Such copiers would obviously not follow if the inventor turns out to have no success. Since the risk of failure would be lower for the followers, they can accept lower margins. The lower risk of failure will also reduce the costs of capital for the followers. In summary, because not only in technology, but also in other fields many instances occur where the decision whether or not to put efforts into development of inventions having a useful effect depends on the likelihood of earning back investments involved in such useful developments, methods involving non-technical inventions should be patentable as such. To avoid the grant of patents for merely intellectual schemes and human skill, the criterium of practical or industrial applicability would need particular attention. Thorough examination on novelty and inventive step, in particular including a realistic interpretation of the fields of expertise of the skilled (team of) person(s) and a reasonable, objective likelihood of success that the claimed method provides the required useful result would be required to ensure that no temporary monopolies are granted where the business method in question does not involve a substantial step away from proven usual practice. III.4 If the answer to III.3 is in the affirmative, can the groups specify whether patentability should solely cover business methods used on the Internet, that is to say which directly implement technical means present on this network or, on the contrary, whether patentability should be accepted for all business methods without distinction? In as far as the members are in favour of an affirmative answer to question III.3, it is observed that the main reason why patent protection is the most suitable form of protection for both technical methods and business methods is the practical effect of the method. Therefore, it does not matter to which type of business such methods relate. III.5 If the answer to III.3 is in the negative, the groups are invited to express their opinion on other means of protection of business methods, such as copyright. In this case, it is requested that the groups present the respective advantages and disadvantages of patents and other means of protection of business methods. On this point, the groups may also refer to the aforementioned resolution (see I (c)) on computer programs. In as far as the group is of the opinion that the response to question III.3 is in the positive, it is nevertheless observed that an invention involves providing a principle by which an effect solving a practical problem can be obtained. Therefore the scope of protection should be defined in terms of features characteristic for the application of the underlying principle and not just for the practised example. Moreover, copyright protection does not require workable publication of the claimed method and therefore provides less support for further development and more uncertainty for third parties. 11

12 III.6 If the business methods are the subject of invention patents, the question arises as to the scope of the protection conferred by a patent concerning such methods. Would this be protection limited to the method itself, or would it be necessary, following the example of the process patent, to provide for protection in addition for products or services marketed through such methods? The advantages provided by a new business method can be commercialised in the form of making available a product or a service obtained by that method. However, if the product or service is merely marketed through the patented business method, i.e. not obtained or at least substantially altered by the patented method, the added value is derived from the method only and not incorporated in the product or service as such. Therefore, it is the opinion of the group that protection should extend to products or services obtained by a business method, only if the product or service is obtained by or at least substantially changed by the business method. It is also the opinion of the group that in this respect the extension of protection for business methods should not be different than the extension of protection for other patentable methods. III.7 Should the rules for assessment of the scope of patents covering business methods be the same as for traditional method or process patents or, on the contrary, should specific rules be applied by the courts, and in this latter case, which rules? For example, if the courts of a country generally apply the theory of equivalents, should this theory also apply to business methods patents? As both business method patents and other method patents have in common that protection is conferred for the application in a method of a principle providing an effect that solves a problem, the rules for assessment of the scope of patents covering business methods should be the same as for "traditional" method or process patents. III.8 Do the Groups consider that the inventive activity of an invention concerning a business method may arise as a result of the simple fact of adapting a known method to new means of communication, such as the Internet? In the opinion of the group the same principles as to inventive step should apply to business method patents, as those applying to "traditional" patents. That is to say, an invention should be considered as involving an inventive step if, having regard to the state of the art, it is not obvious to a person skilled in the art. Accordingly, no general answer to the question can be given. Inventive step should be determined on a case by case basis. In some cases the adapting of a known method to new means of communication would not have been obvious to the skilled person. For example, this will be the case if there was a prejudice in the state of the art against the adapting of the method in new means of communication. The EPO case law on the subject of new use of known measures may give guidance in this respect E.g. T 301/90, see also: Case Law of the Boards of Appeal of the European Patent Office, 3 rd edition 1998, pp

13 III.9 With respect to acts of infringement, should the usual rules in patent law be applied: direct or indirect infringement, infringement by incitement, supply of means etc., or on the contrary should special rules be applied to patents covering business methods? Thus, the US Act of 29 November 1999 provided a new defence in the event of alleged infringement of a patent with process claims. And the question arises in interested circles as to whether these new legislative provisions apply to all patents including process claims or only those where the claims concern business methods. In the opinion of the group, as regards acts of infringement, the usual rules in patent law should be applied. Under Dutch Patent Law, the patentee can oppose direct infringement and indirect infringement. Direct infringement: may be defined as performing any act which, according to the patent, is or forms part of the exclusive right of the patentee. Indirect infringement: Pursuant to Article 73 of the Patent Act 1995, indirect infringement is defined as the delivery or making available of means concerning an essential element of the invention to a third party that is not authorised to use or apply the patent, provided that the person performing such acts of delivery is aware, or should be aware, that the means are suited for the application of the patent in the Netherlands (or, as the case may be, the Netherlands Antilles) and meant to be used for that purpose. It should be noted that indirect infringement only occurs in the event that the means are being delivered or offered in the Netherlands (or the Netherlands Antilles, in case of a patent granted on the basis of a Dutch national application). Thus, the concept of indirect infringement under Dutch law seems to include supply of means, but is not necessarily identical to the concept of contributory infringement. Infringement by incitement seems to be a specific form of indirect infringement, which occurs when someone delivers means which are generally available in the trade, while inciting a third party to commit an act of patent infringement. Pursuant to Article 73(2) DPA indirect infringement does not apply if the means delivered are generally available in commerce, "unless the person involved incites the third party to whom he delivers to perform infringing acts". With respect to the new prior use defence introduced in the U.S. with the Act of 29 November 1999, there is no need for a special provision under Dutch law, as Article 55 DPA already provides for such a general defence which is not limited to any specific kind of invention. III.10 Should rules concerning compensation for loss as applied to the infringement of patents covering business methods be the same as are applied to patents covering inventions in traditional fields, or should these rules be modified for the infringement of patents covering business methods, taking account of the fact that these methods are not used, in principle, for the manufacture of products but solely for the sale of products and services? 13

14 In the opinion of the group, the rules for compensation of damages in relation to business method patents should not be different from those which are applicable with respect to inventions in traditional fields. Under Dutch law damages may be awarded for any loss or lost profit, including: - reasonable expenses for the avoidance or mitigation of damage; - reasonable costs for determining the damage suffered or establishing liability; - reasonable costs made for obtaining relief without involving a court of law; - surrender profits made as a result of the infringement and to give an accounting of such profits pursuant to Article 70(4) DPA. The group has not been able to think of any kind of damage in relation to a business method, which would not be eligible for compensation under the rules which are generally applied to compensation of damages. Accordingly, there seems to be no need for additional rules specifically for business method patents. III.11 Should the rules of evidence concerning the infringement of a patent covering business methods be the same as those concerning process patents or patents for traditional methods? In particular, do the groups consider that the provisions of Article 34 of the TRIPS agreement concerning the burden of proof should apply to patents covering business methods? The answer is yes (both questions): In the opinion of the group, there seems to be no reason why the rules concerning evidence in relation to infringement of a business method patent should be different from those which are applicable with respect to inventions in traditional fields. Accordingly, the provisions of Article 34 TRIPS should apply to business method patents in the same manner as to other process patents or patents for traditional methods. The question is if it would be necessary for the Dutch legislator to make an amendment of Article 70 (7) DPA which gives a rule for the division of the burden of proof in the event of an infringement claim with respect to a process for the manufacture of a new product. In such cases the product concerned is deemed to have been made in accordance with the patented process, unless the defendant makes plausible that this is not the case. In the opinion of the group it is doubtful whether this provision can be applied by analogy when the infringement concerns a business method, i.e. a process used for the provision of a new service. However the group has the opinion that a specific amendment of the law doesn't seem required unless the word "product" in Article 70 (7) DPA would be interpreted so restricted that it would not include "services". Summary The legal situation In the Netherlands two separate Patent Acts are currently in force, the Patent Act 1910 and its successor the Patent Act The Patent Act 1910 is still applicable to patent applications which were filed before the entering into force of the Patent Act 1995 (April 1, 1995), and to patents granted on those applications. 14

15 The Patent Act 1910 does not contain specific statutory exclusions of patentability with regard to intellectual and abstract methods. Nevertheless, it is generally held that the statutory exclusions relating to abstract methods contained in the European Patent Convention and the Patent Act 1995 (see below) are also applicable under the Patent Act The Patent Act 1995 contains a non-limitative list of statutory exclusions which corresponds to Art. 52(2) of the European Patent Convention. The exclusion from patentability of business methods only concerns the methods as such. It is generally held that for the examination of the patentability of a business method invention, the criteria which are applicable to European patent applications/patents, also apply to Dutch patent applications/patents. Other means of protection of business methods, include copyright. In copyright law, it is generally accepted that ideas are not protected, irrespective of their novelty, inventiveness or commercial potential. Ideas which have been developed into a concrete "concept" or a "plan of approach", however, are considered as a "work" within the meaning of the Copyright Act. In two cases relating to formats for television programs it was held that the format of a television program had been sufficiently developed to form a work protected in the sense of the Copyright Act. Another possible instrument of protecting business methods, would be through the law of unfair competition. Profiting from the achievement of a third party may be tortuous if this achievement "is of such a nature that it could be put on a par with those achievements which justify granting of such a right" [i.e. an intellectual property right]. It appears, however, that courts interpret this principle in a very restrictive manner. Basically, there is no distinction in the grant of patent protection between traditional business sectors and business methods used in the context of Internet. Decisions providing special guidance for determining the extent of the protection conferred by business method patents are not available. Opinion of the group An invention could be defined as a new and inventive solution to a problem. Business methods (in themselves) may be also covered by this definition. In the opinion of the group, excluding business methods "as such" from patentability would still be in conformity with TRIPS if a narrow interpretation of "as such" would be used, for instance only excluding inventions for business methods that are not in any field of technology. Case law of the Dutch national courts already shows that the courts want to remain within the limits of the TRIPS obligations. The group is of the opinion that patentability of business methods is desirable for inventions which provide a technical solution for a problem, i.e. if the solution includes technical features of which the function is essential for the invention. However, opinions vary on the question whether or not business methods for non-technical inventions (which provide a non-technical solution for a problem) should be patentable. Reasonings against 15

16 and in favour of patentability of business methods for non-technical inventions are set forth in the response. The group is not in favour of making a distinction between Internet business methods and other business methods. It is the opinion of the group that protection of business method patents should extend to products or services obtained by a business method, only if the product or service is obtained by or at least substantially changed by the business method. It is also the opinion of the group that this should apply to other patentable methods as well. Also in respect of the rules for assessment of the scope of patents, the determination of inventive step, the determination of contributory infringement, the rules for compensation of damages and the rules of evidence concerning infringement, the group is opposed to a distinction between business method patents and "traditional" method or process patents. Résumé La situation légale En Hollande il y a deux lois sur les brevets qui sont en rigueur, à savoir la Loi 1910 sur les brevets et son successeur la Loi 1995 sur les brevets. La Loi 1910 sur les brevets s'applique toujours à des demandes qui avaient été déposées avant l'entrée en rigueur du Loi 1995 sur les brevets (Avril 1, 1995), et à des brevets issus de ces demandes. La Loi 1910 sur les brevets ne contient pas d'exclusions légales spécifiques en ce qui concerne l'accordement de brevets par rapport à des méhodes intellectuelles et abstraites. Néanmoins, on estime généralement que les exclusions légales par rapport à des méthodes abstraites contenant dans le Convention sur le brevet européen et dans la Loi 1995 sur les brevets (voir ci-dessous) s'appliquent également sous la Loi 1910 sur les brevets. La Loi 1995 sur les brevets contient une liste illimitée d'exclusions légales qui correspond à l'art. 52(2) CBE. L'exception de brevetabilité des méthodes dans le domaine des activités économiques concerne seulement les méhodes en tant que tel. On estime généralement que, pour l'examen de brevetabilité d'une invention dans le domaine des activités économiques, les critères qui s'appliquent à des brevets/demandes de brevet Européens, s'appliquent également à des brevets/demandes de brevet Néerlandais. D'autres moyens de protection de méthodes dans le domaine des activités économiques contiennent le droit d'auteur. Selon la Loi sur les droits d'auteur, il a été généralement accepté que les idées ne sont pas protégées, quel que soit leurs nouveauté, inventivité ou potentiel commercial. Cependant, des idées qui ont été développées à un "projet" concret ou à un "plan d'approche" sont considérées comme un ouvrage dans le sens de la Loi sur les droits d'auteur. En deux cas concernant des formats pour des programmes de télévision le format d'un programme de télévision avait été considéré suffissamment développé afin de former un ouvrage protégé dans le sens de la Loi sur les droits d'auteur. Un autre instrument possible de protéger des méthodes dans le domaine des activités économiques, serait au moyen de la loi de concurrence déloyale. Profitant du travail d'un 16