The government has released a new supplementary order paper clarifying the Patents Bill clause on the patentability of computer programs.

Clause 10A reads:

"10A: Computer programs

(1) A computer program is not an invention and not a manner of manufacture for the purposes of this Act.

(2) Subsection (1) prevents anything from being an invention or a manner of manufacture for the purposes of this Act only to the extent that a claim in a patent or an application relates to a computer program as such.

(3) A claim in a patent or an application relates to a computer program as such if the actual contribution made by the alleged invention lies solely in it being a computer program."

The new Clause 10A in Supplementary Order Paper 237 is certainly an improvement over Clause 15(3A), originally added by the Parliamentary Commerce Select Committee. This clause was added in response to submissions received from members of the open source movement who were keen to see a European-style exclusion. It was therefore surprising to see the committee recommend an exclusion that did not follow European law, despite advice and submissions to the contrary. The exclusion inserted by the committee simply read: "A computer program is not a patentable invention."

The 'as such' language is also preferable to another supplementary order paper (Supplementary Order Paper 123) tabled by the opposition attempting to enshrine the term 'embedded computer program' in legislation. This was always going to be difficult. It is good to see that the opposition no longer supports this approach.

Clause 10A contains several new clauses intended to clarify the meaning of the term 'as such'. The intent of the new language seems to be to placate those expressing concern in their original submissions on the bill. It is a compromise between stakeholders wanting to protect their research and development spend on the one hand, and those philosophically opposed to patents on the other.

It seems reasonably clear that computer programs that control an external device may give rise to patentable subject matter. Computer programs that merely automate a manual process appear to be excluded, although these types of invention would have been subject to obviousness issues anyway.

The legislation requires the Intellectual Property Office of New Zealand to consider the problem or other issue to be solved or addressed. In the United Kingdom, a computer programmed to perform a task that is technical in nature is a patentable invention. The UK courts, for example, have allowed patents for a computer programmed to work better (as in the Symbian case), a better way of designing drill bits (as in Halliburton) and organisation of touch-screen devices (as in HTC Europe v Apple). It remains to be seen how this sort of subject matter will be treated.

Clause 10A replaces an earlier version tabled by the government as Supplementary Order Paper 120. That clause also had a European look about it, as it excluded computer programs "as such". It remains to be seen whether new Supplementary Order Paper 237 is an improvement over Supplementary Order Paper 120. The opposition is calling it a humiliating backdown. The government is calling it a clarification of the law. Others are calling it an outright ban on software inventions. It is clear that there are differing views on what Supplementary Order Paper 237 is trying to achieve. It is therefore likely that not all expectations will be met.

In any case, it is good to see some progress at last on patent law reform. Now that the concerns of the open source movement have been addressed, it is anticipated that the bill will go through in the next few months.

For further information on this topic please contact Matt Adams at AJ Park by telephone (+64 4 473 8278), fax (+64 4 472 3358) or email (matt.adams@ajpark.com).

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