[Random-bits] Philip Sishkin: EU considers business practices patents

[James Love]

Europe's Confusing Laws Push Net Firms to Seek Patents in U.S.

By PHILIP SHISHKIN
Staff Reporter of THE WALL STREET JOURNAL

  [snip]

Not only is Europe a smaller Internet market than America, but
also European patent laws are perceived to be less welcoming to
software and Internet products than those in the U.S., says Adam
Hodgkin, one of Xrefer's founders.

Consider this clause from the European Patent Convention:
"Programs for computers are excluded from protection under
European patent law."

Officials from the Munich-based European Patent Office 
hurry to explain that this clause is largely an obsolete legal
quirk and that in reality software patents can be obtained in
Western Europe, provided they meet certain technical
requirements. But some patent experts say that this turn of
phrase can confuse small-time programmers and Internet 
entrepreneurs.

'Lack of Transparency'

"There is certainly a lack of transparency," says Gert 
Kolle, EPO's director of international legal affairs. "There are
some unjustified fears and concerns. We see the point and we are
doing our best to change it." The EPO is working on an amendment,
which will replace the misleading language with something similar
to this phrase: "European patents shall be granted for any
inventions in all fields of technology," according to an EPO
document.


   [snip]

Europe's patent practices came under fire earlier this week when the
EU's research commissioner, Philippe Busquin, said too many European
companies are going to the U.S. to obtain their patents.

The European Patent Convention was drafted in 1973, and the EPO was
created shortly afterward. The EPO examines patent claims for the 15
member-states of the EU plus Switzerland, Monaco, Lichtenstein and
Cyprus, and decides whether a patent should be granted.

Provisions Not Up-to-Date

A national authority then issues the actual patent.  However, some of
the patent office's provisions drafted in the '70s turn out to be
ill-suited for the technology-heavy '90s, and patent office's experts
seem to acknowledge some of the lapses.

Just last month, the European Patent Court modified an old regulation
that excluded genetically modified plants from patent protection. Ruling
on an appeal filed by Swiss biotechnology concern Novartis AG, the court
decided that when the old rules were drawn up "it was inconceivable that
[plant] varieties could be obtained with the help of techniques
including microbiological steps." While some environmentalists decried
the ruling, a Novartis spokesman praised it saying "it allows companies
to protect biotech inventions just like you would protect any other kind
of invention."

  [snip]

Protecting Business Methods

Europe has shunned another software-related U.S. patent trend: In 1996,
a U.S. court ruled that patents can be granted to protect business
methods. The most vivid example of that decision is a face-off between
online booksellers Amazon.com Inc. and barnesandnoble.com Inc. Last
month, Amazon obtained a preliminary injunction barring its competitor
from using Amazon's patented one-click shopping feature.

This couldn't happen in Europe. "The EPO has no intention of
either revising the convention or changing its practice" of not 
patenting business methods, one of the agency's documents reads.

The U.S. and Europe have long held different philosophies about granting
patents. The U.S. in general has fewer patent restrictions. Europe, on
the other hand, has adopted a pickier approach to granting patents.


  [snip]

Write to Philip Shishkin at philip.shishkin@wsj.com