Patenting computer software inventions makes sense for the Chinese e-commerce industry for three reasons. First, the Chinese government wants more businesses to patent their technological innovations. This policy is supported at the national level and the central government pays for inventors to apply for patents. Second, e-commerce is very important in China. One quarter of all consumer purchases in China are done on-line. And that number is unlikely to get smaller. Third, today's Chinese consumers have many options and they have grown to expect quality products, quick service and reasonable prices.
For most active businesses, the third reason is the key. Finding an edge in meeting those consumer expectations has made for a fiercely competitive marketplace. Protecting process innovations that involve software improvements is, as it is everywhere, problematic. How are computer software inventions protected in China as a matter of law?
Process Patents and China's Patent Law
Computer software invention patents are sometimes argued to be a sub-set of process patents. Process inventions can be patented in China: "Inventions mean new technical solutions proposed for a product, a process or the improvement thereof." (Patent Law, Article 2)1 However, like most countries, China's Patent Law is interpreted so that so-called business processes cannot be patented: "Patent Rights shall not be granted for...rules and methods for intellectual activities." (Patent Law, Article 25(2))2 Is a software invention patentable in China? As recent decisions in the courts of the United States and elsewhere make clear, determining whether an invention that relies on software is patentable is a real concern for any global business.
The State Council's Interpretation of the Patent Law
China's State Council has issued guidance relating to this question. (Without getting into China's complicated law making process, a State Council interpretation would be seen as definitive in a Chinese court). As a general matter, the "Review Guide"3 published in 2010 interprets Article 2 of the Patent Law to mean that technical solutions are a collection of technical means to take advantage of the nature of the technical problems to be solved. Technical means are usually reflected by technical features. Technology to solve technical problems, in order to obtain a solution in accord with the nature of the law of the computer program, is not patentable.
Intellectual activity, as it is used in Article 25, refers to the movement of human thinking, or those derivations from human thinking, through reasoning, analysis and judgment of the results of abstract ideas. It also refers to a process that moves by using human thinking as a medium, thereby indirectly acting on the natural results. The rules and methods of intellectual activities are the rules and methods used to guide humans to carry out their thinking, expression, judgment and memory.
Based on this interpretation, a process of intellectual activity does not use technical means or natural law. It does not solve a technical problem and produce a technical result. And, it does not constitute a technical solution, as that term is understood in Chinese law. Therefore, it is not in conformity with the provisions of Article 2 of the Patent Law. And, granting a patent for such a process is directly prohibited by Article 25(2).
All of which is to say, the rules and methods that guide humans to carry out such intellectual activities can not be granted patent rights. In China's intellectual property scheme, the computer program itself belongs to the rules of intellectual activity, does not constitute a technical scheme, and can be protected by copyright law but not patent law.
Patentable e-Commerce Computer Inventions
E-commerce involves many uses of computer program inventions to reach technical solutions. Are these inventions patentable given the State Council's interpretation of the law?
The Review Guide answers this question. As a general matter, a computer software invention can satisfy the Patent Law if:
- The purpose of an invention patent application is to solve a technical problem;
- The computer program controls or treats external or internal objects by natural laws using technical means, and;
- Technical results in line with natural law are obtained.
The following is an example of this interpretation as provided in the Review Guide. An encoding method for Chinese characters cannot be patented. However, a Chinese character encoding method and a machine encoding method can be used to form a computer system to deal with a Chinese character input method. In that case, the computer hardware system can use the Chinese character information as the instruction to control or deal with external objects or internal objects.
Developing computer software inventions to meet the State Council's interpretation of the law is one challenge in using the patent law. But a properly drafted patent application that can meet the standards of Article 2 and avoid the prohibition of Article 25 is also required. Practitioners and their clients must pay careful attention during the application process to ensure conformity with the Patent Law and the Review Guide's interpretation.
2 Id. 第二十五条：对夏利各项，不授予专利权：...（2）智力活动的规则和方法.
3 《专利审查指南》（2010）第九章 关于涉及计算机程序的发明专利申请审查的若干规定（http://www.chinalaw.gov.cn/article/fgkd/xfg/gwybmgz/201004/20100400253035.shtml）(Last accessed 08282015)
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.