Hot on the heels of the US Supreme Court ruling in
Bilski, the Canadians have jumped back on the business
This is a significant result for Canada, noting that the recent
Patent Office practice has been particularly unfavourable for
business methods and various forms of computer implemented
In 2009, the Canadian Patent Office Board of Appeals rejected
Amazon's infamous "one-click" patent.
In essence, the Board's position was that, "since
patenting business methods would involve a radical departure from
the traditional patent regime, and since the patentability of such
methods is a highly contentious matter, clear and unequivocal
legislation is required for business methods to be
Following the Board decision, applicants encountered substantial
difficulties in obtaining patents for various forms of computer
implemented technology. Examiners would adopt a "form and
substance" approach for assessing patentable subject matter,
and require that "inventive" characteristics be
technological in nature.
Not wanting to go down without a real fight, Amazon appealed the
decision to the Federal Court.
Overview of Federal Court Decision
To summarise the decision in a few words: the Court saw nothing
in the law to prevent business methods like that of Amazon from
The Federal Court threw out the "form and substance"
approach, to a degree reprimanding the Commissioner for
establishing new criteria for patentability above and beyond that
which is set out in the legislation. Furthermore, the Court noted
that there was not, nor has there ever been, legislative provisions
preventing the patenting of business methods.
The Court suggested the following test for assessing patentable
(i) It must not be a disembodied
idea but have a method of practical application.
(ii) It must be a new and inventive method of applying skill and
(iii) It must have a commercially useful result.
The court went on to confirm that it was not necessary for
material objects to be physically altered. Accordingly, there is
scope to protect business methods and the like without necessarily
requiring implementation via a computer or the like.
The Court also rejected the Commissioner's requirement
for the "inventive" subject matter (i.e. that which
differentiates an invention from the prior art) to be technological
in nature. In the Court's view, no such requirement existed
in Canadian law, and it was not within the Commissioner's
jurisdiction to introduce one. After all, it is not the place of
the Patent Office to mandate policy decisions in relation to
patentability; that is for the legislature.
In a nutshell, when it comes to patentability of business
methods, software, and other computer implemented technology,
Canada is now one of the greenest pastures. The new liberal
standard for assessing patentable subject matter brings Canada back
into close alignment with Australia and the US and, noting cultural
similarities between the jurisdictions, that can only be a good
It seems unlikely that the Office will appeal the Federal Court
decision, so this applicant-favourable situation is likely to
persist for quite some time.
Of course, the position on what constitutes patentable subject
matter will continue to develop differently between jurisdictional
boundaries. It is possible to deal with the associated risks
through the active and careful development of a patent portfolio.
And, of course, that is something with which Shelston IP
is well placed to assist.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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