Analysis Of Section 3(k) Of The Patents Act In Light Of Fujitsu's Case Study And Parliamentary Committee Report

Introduction

Fujitsu's Application, a landmark case in 1997, stands out in the history of UK case law. The Court of Appeal held that UK courts should look to decisions of the European Patent Office (EPO) for guidance in interpreting exclusions. The judgment emphasized the necessity of a "technical contribution" for an invention to be potentially patentable. It introduced the concept that the substance of an invention should be used for assessment, not merely the form in which it is claimed.

Aerotel v Telco and Macrossan's Application (2006) revisited the issue of excluded subject matter. The Court of Appeal reaffirmed the requirement for a "technical contribution" and criticized the EPO's reliance on paraphrasing exclusions under the blanket heading of "technical." Aerotel's patent was deemed eligible due to the novelty of the system, while Macrossan's application was rejected for lacking a contribution beyond excluded subject matter.

The High Court judgments, particularly post-Fujitsu, demonstrated a re-evaluation of patent applications involving software. In CFPH LLC's applications (2005), the court criticized the EPO's reliance on the term "technical" and considered whether an invention is excluded by examining the novel and inventive advance

A notable development occurred after Aerotel v Telco and Macrossan's Application when the UKIPO issued a Practice Note in 2006, reflecting a restrictive interpretation. This practice change, however, was later revised in 2008, reinstating the previous approach of permitting claims to computer programs if the underlying method was patentable.

Comparing the practices of the EPO and the UKIPO reveals substantial differences. The EPO generally accepts patent applications related to computer-implemented methods as "inventions," focusing on technical features for inventive step. In contrast, the UKIPO considers any feature, whether technical or not, as capable of contributing to an inventive step.

Furthermore, the legislation governing business procedures and their patentability has changed internationally in many jurisdictions. Section 1(2) of the Patents Act in the United Kingdom lists the excluded innovations as follows:

Furthermore, Article 52 of the European Patent Convention reads as under: "Article 52 Patentable inventions (1) European patents shall be granted for any inventions, in all fields of technology, provided that they are new, involve an inventive step and are susceptible of industrial application; (2) The following in particular shall not be regarded as inventions within the meaning of paragraph 1: (a) discoveries, scientific theories and mathematical methods; (b) aesthetic creations; (c) schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers; (d) presentations of information; (3) Paragraph 2 shall exclude the patentability of the subject-matter or activities referred to therein only to the extent to which a European patent application or European patent relates to such subject-matter or activities as such."

A reading of both of these sections reveals that the omission of business processes is phrased differently as 'schemes, rules, or methods for doing business.' This exclusion is subject to the restriction in Section 1(2) and Article 52(3) that such subject matter or actions 'as such' are excluded. Thus, in both the United Kingdom and Europe, the qualification 'as such' applies for all kinds of banned innovations, particularly business procedures. As a result, the hurdle is not unconditional, and patenting may be acceptable if there is something other than the business technique itself. In India, however, the phrase 'per se' cannot be considered business techniques. Thus, a patentability of inventions that involve business methods or financial interactions asserted on a foundation of rulings from the United Kingdom and the European Patent Office analyzing the technological impact of a business method invention wouldn't be directly admissible in India. In India, the restriction to granting business method patents must be interpreted as a complete ban without considering questions of technological effect, implementation, technical development, or technical contribution. Thus, when dealing with patent applications including a business technique, the only question that the Court or the Patent Office must assess is if the application for a patent tackles a business or administrative issue or offers a solution to it.

Parliamentary Standing Committee Report on Section 3(k) and Conclusion

One Hundred and Sixty First Report of the 'Review of the Intellectual Property Rights Regime in India' presented by the Parliamentary Standing Committee (hereinafter 'Parliamentary Committee Report') which has been recently published, has discussed a lot about the interpretation of Section 3(k) and the related uncertainty in the contemporary era.

Furthermore, the requirement of a human inventor for developing computer-related inventions (AI and machine learning innovations) impedes the patenting of AI-induced advancements in India. As a result, there is an urgent need to evaluate the provisions of both statutes. During discussions with the appropriate stakeholders, the Committee discovered that safeguarding of both works created by AI and AI solutions ought to be allowed under Indian patent laws, as this would stimulate innovation and R&D, greatly adding to the country's creativity and economic expansion. It was explained that providing protection to works made by AI, whether independently or with the support and contributions of a human, would incentivise and motivate the inventor of the AI, which would in turn drive creativity and the creation of new AI solutions.

REFERENCES

1. Department-related Parliamentary Standing Committee on Commerce, Review of the Intellectual Property Rights Regime in India, 161st Report, 253rd Session, 17th Lok Sabha (last visited Nov. 3, 2023).
2. Fujitsu's Application [1997] EWCA Civ 1174.
3. Menashe Business Mercantile Ltd. & Anor v William Hill Organization Ltd. [2002] EWCA Civ 1702.
4. Aerotel Ltd. v Telco Holdings Ltd & Others [2006] EWCA Civ 1371.
5. CFPH LLC's Applications [2005] EWHC 1589.

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