Comparative Patent Eligibility with a Focus on
Software Patents (*)
Invited Researcher: Matteo DRAGONI (**)
This research aims at investigating software patent-eligibility in Japan and to make acomparison with the practice that has been developed under the European Patent Convention(EPC) and in the United States. Even though the research mainly targets software patenteligibility, also patentability issues and aspects are taken into account.
Legislations concerning IP rights seem harmonized but, especially with regard to the patent
protection of computer programs, U.S. and Europe show a few significant differences, withreverberations on the level of protection. The Japanese system seems to offer some sort of “thirdmodel”, which is different from both the United States and the EPC system, notwithstanding
several similarities with both the aforementioned realities may be found.
This work, after the analysis of software inventions’ patent-eligibility in Japan, Europe and UnitedStates, ends with an assessment of the level of protection of computer programs in Japan from apatent perspective, taking into consideration (and weighing) the differences with U.S. and Europe.

I. A framework of the current situation regarding software patenting in Japan
1. Software patenting requirements: Patent-eligibility, inventive step and other considerations(1) The current IP legal framework: The statute
The starting point1 when talking about the current Japanese approach2 to software patent-eligibility
and patentability is the definition of invention.
Art. 2 of the Japanese Patent Act (JPA) clarifies that “"Invention" in this Act means the highly
advanced creation of technical ideas utilizing the laws of nature”3
According to Japanese scholarship, making a reference to laws of nature would specify that mental
activities, pure academic principles, rules for games and businesses per se etc. are excluded frompatentability4.
(*) This is a summary of the report published under the 2016FY Industrial Property Research Promotion Project entrusted by theJapan Patent Office.
(**) Ph.D., LL.M. (Stanford) - Research Fellow, University of Pavia, at our institute over a period of approximately 3 months from
August 22, 2016 through November 19, 2016, as an Invited Researcher for the Fiscal Year 2016.
1
See generally Yoshiaki Aita, Ch. 3 Legal Protection of Computer Software, 3 History of Legal Protection of Software, 3) PatentProtection (Yoshiaki Aita et al., Advanced Science Technology and Intellectual Property Rights, Hatsumei Kyokai, 2001, pp. 117119. See also Akihiro Sako, Patentability of Inventions Incorporating Human Mental Acts (Intellectual Property High Court,
August 26, 2008), Intellectual Property Law and Policy Journal, vol. 34, 2011.
2 See https://www.j-platpat.inpit.go.jp/web/all/top/BTmTopEnglishPage (last visited on December 17th, 2016).
3 See Law No.121 of Apri1 13, 1959, as lately amended by the Act on the Partial Revision of the Patent Act and Other Acts (ActNo. 55 of July 10, 2015), Article 2(1). See http://www.japaneselawtranslation.go.jp/law/detail/?id=42&vm=04&re=02 (lastvisited on November 15, 2016).
4 See NOBUHIRO NAKAYAMA, PATENT LAW, Koudundou, 2012, 2nd ed, pp. 105-106.

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Then the reference to “technical ideas” seems to be linked to the concept that an invention must be
something “technical”, i.e. something objective and that can be repeated - not the product ofrandomness5 - and linked to the concept of enablement6.
Finally, “creation” is used to distinguish inventions from mere discoveries, where human beings do
not intervene7.
Art. 2 of the JPA also defines a "computer program, etc.”8 and, more significantly, since recently
the JPA clarifies that “programs etc.” may constitute invention of “product”9.
(2) The current IP legal framework: the JPO Examination Guidelines and Examination Handbook
Other important sources which can be relied upon when dealing with software patents are the JPO“Examination Guidelines for Patent and Utility Model in Japan” and the JPO “Examination
Handbook for Patent and Utility Model”10.
Mainly based on Art. 2 of the JPA, but also on the case law, the Examination Guidelines enlist a
series of subject matters excluded from patent-eligibility, also called “Non-Statutory Inventions”11:“(i) A law of nature as such.
(ii) Mere discoveries and not creations.
(iii) Those contrary to a law of nature.
(iv) Those in which a law of nature is not utilized.
(v) Those not regarded as technical ideas.
(vi) Those for which it is clearly impossible to solve the problem to be solved by any means
presented in a claim.”

5 See

Id. at 114. See also Supreme Court of Japan, February 29, 2000, Hanta, No. 1028, at 173 (so called Breeding andProliferation Method case), as explained in Akihiro Sako, Patentability of Inventions, supra note 1, at footnote 15.
6 See Akihiro Sako, Patentability of Inventions, supra note 1, at footnote 8.
7 See Akihiro Sako, Patentability of Inventions, supra note 1, at footnote 9 and the references cited therein.
8 See Law No.121 of Apri1 13, 1959, as amended during the years, Article 2(4).
9 See Law No.121 of Apri1 13, 1959, Art. 2(3)(i).
10 See Hiroaki Sakai, Historical Transition of Computer Program Protection- A Review of Examination Guidelines over a Quarter
Century, Habataki -- 21 seiki no chiteki zaisanho (Flapping -- Intellectual Property Law in 21st Century), marking the 70thbirthday of Mr. Nobuhiro Nakayama,” pp.154-172 (Kobundou, 2015).
11 See the Examination Guidelines for Patent and Utility Model in Japan, page 2, 2.1.

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(3) Software patent-eligibility and patentability: JPO Guidelines and Handbook, case law andpractice
When dealing specifically with software patent-eligibility12, the Examination Guidelines specify13that inventions relating to business methods, playing a game and calculating mathematical formulacan be considered as “not utilizing the laws of nature when considered as a whole” 14 even though
they make use of “an article, apparatus, device, system, computer software etc.” 15
The JPO Guidelines also state that some inventions relating to business methods, playing a gameor calculating formulas could be deemed “statutory inventions” just because they utilize computer
software. In such a case, the invention and its patent-eligibility must be considered “from the pointof view of computer software”16.
On the contrary, some inventions can be considered to be a “creation of a technical idea utilizing alaw of nature” independently of whether computer software is used or not. Those kinds ofinventions do not have to be examined “from a viewpoint of computer software”.
When an invention is specifically related to software and must be therefore analyzed under the“computer software viewpoint”, the Examination Handbook tries to provide some guidance on
how that must be done.
First of all, the software of a software-related invention is considered “a creation of a technicalidea utilizing a law of nature” if the information processing by such software is “specifically
implemented by using hardware resources”17.
In Japan, as specified by the JPA that allows for the patenting of software computer programs as“product inventions”, it is possible to patent software “per se”. Therefore, the specific interaction
between hardware and software components is not necessary to patent a software invention but it isan example (probably the most common one) of how a software invention is usually deemed to be“using a law of nature”, which is in any case the basic requirement an invention must possess to beconsidered patent-eligible.
In doing the patent-eligibility examination, the invention is considered “as a whole”, as the
12 SeeNOBUHIRO NAKAYAMA, PATENT LAW, supra note 4. See also Ryuta Hirashima, A Note on Patenting Computer
Software-related Invention & Assessing the Requirement "Utilizing a Law of Nature" Under the Japanese Patent Law—
Something Like "the Suggestion" from LSI Simulator Case, Intellectual Property Law and Policy Journal, Vol. 20., pp.65-94,
2008.
13 See Part 3. Chapter 2.2.(2) of the JPO Examination Guidelines.
14 See Intellectual Property High Court, First Division, June 24, 2008, 2007 (Gyo-Ke) 10369 with regard to the “essence of theinvention” evaluation which might occur.
15 Id. See Akihiro Sako, Patentability of Inventions, supra note 1. See also Tokyo District Court Judgment, January 20, 2003, Hanji,
No. 1809, p. 3/Hanta, No. 1114, p. 145; Tokyo High Court, December 21, 2004, 2004 (Gyo-Ke) 188, Hanji 1891∙139;
Intellectual Property High Court, August 26, 2008, Hanji, No. 2041, p. 124/Hanta No. 1296, p. 263, 2008 (Gyo-Ke) 10001;
Tokyo IP High Court, September 24, 2014, 2014(Gyo-ke)10014; Tokyo IP High Court, February 24, 2016, 2015 (Gyo-Ke) 10130.
16 Id. See also Katsuya Tamai, "Business Method Patent and the Examination of the Non-technical Elements of the Patent
Application -A Comparative Study with the Practice in Europe-", Patent Studies No.38, p.22 (2004).
17 See JPO Examination Handbook, Annex B, page 9 and seq.

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Examination Guidelines carefully point out18 and the case law confirms19.
To conclude, it is important to note that also at the inventive step stage of the examination theinvention is considered and evaluated “as a whole”, i.e. without artificially severing the original
parts from the non-original parts and, most importantly, without separating technical from nontechnical elements.

II. A comparison with the evolution of EPO and U.S. approaches
1. Europe
When dealing with software patenting in Europe, we must start from Art. 52.1 EPC, according towhich patents “shall be granted for any inventions which are susceptible of industrial application,
which are new and which involve an inventive step”.
According to Art. 52.2 EPC, discoveries, scientific theories, mathematical methods, aesthetic
creations, schemes, rules and methods for performing mental acts, playing games or doing
business, presentations of information and programs for computers shall not be regarded as
inventions.
The above-mentioned exclusion, however, is not as absolute as it might seem, since art. 52.3 EPC
clarifies that it is limited only to patent applications directed to computer programs “as such”.
(1) The current situation: the EPO Enlarged Board of Appeal decision of 2010 and its progeny
Some cases in the early 2000 regarding software patentability / patent-eligibility20 were deemed tocast many doubts about the correct interpretation of the (art. 52 EPC) computer programs
exclusion from patentability, the EPO Enlarged Board of Appeal (EBA) was asked to clarify thematter and decided as follows. According to the EBA 21 , a computer program, in order to bepatentable, has to generate “further technical effects”, but those effects do not have to be originalor new. Moreover, tying the software with “any hardware” is not enough: further technical effects
must be achieved, but only when the software is claimed alone.
In fact, if something else containing the software is claimed, for instance a “storage medium”,
18 See also Guidelines of Examination, chapter 2.2, previously quoted, where the need to consider the invention “as a whole” is alsostressed.
19 See ex multis Intellectual Property High Court, First Division, June 24, 2008, 2007 (Gyo-Ke) 10369. See Intellectual Property

High Court, September 26, 2006, 2005 (Gyo-Ke), 10698 (so called Amusement Management case) as explained in Akihiro Sako,
Patentability of Inventions, supra note 1, at note 55.
20 See T 258/03, Auction Method/HITACHI; T 424/03, Clipboards formats I/Microsoft; T 154/04, DUNS LICENSINGASSOCIATES/Estimating Sales Activities
21 See G 03/08.

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there is no patent-eligibility issue there. Since “storage media” per se are not excluded frompatentability, the analysis will immediately be focused on the patentability requirements22.
In such analysis, the EBA clarifies that all the elements of the claimed invention have to be taken
into account, not only the technical / non-excluded ones.
Lastly, the fact that when a program is run on a computer it produces a technical effect because
current circulates into the computer is not enough to confer technical character to the computerclaimed alone23.
The EBA’s teachings are followed in the subsequent decisions of the Technical Boards and they
have been incorporated in the EPO Guidelines for Examination, whose last version entered into
effect from November 1st, 201624.
Finally, it must be stressed that during the “inventive step” analysis the Art. 52.2 EPC exclusions
are revived: the invention’s inventive part must have technical character, i.e. it must produce anoverall technical effect or some technical effects must be produced from the effect of the softwareon the computer. In other words, the invention must represent a “technical solution to a technicalproblem”, which means that only the features contributing to the technical characters of theinvention must be considered when assessing the inventive step, be them technical or nontechnical ones25.
2. The United States
U.S. statutory law never contained an explicit list of “excluded subject matters”, i.e. categories ofinventions (or “non-inventions”) that are excluded from patentability. As a consequence, in the
U.S. there was no explicit exclusion of “software patents” from the scope of the Patent Act.
However, a less specific (if compared to the EPC) list of “excluded categories” has been createdthrough a series of judicial precedents.
United States courts, through a series of decisions interpreting the U.S. Patent Act and in particular
USC 35 § 101, began to exclude ‘abstract ideas, natural phenomena or natural laws’ from thescope of patentable subject matter.

22 See G 03/08, pp. 38-39 at 10.8.7.
23 See G 03/08, p. 53 at 13.5. See also G 03/08, pp. 53 and seq.
24 See https://www.epo.org/law-practice/legal-texts/guidelines.html (last visited on December 18, 2016).
25 See EPO Guidelines for Examination, Part G, Chapter VII.5.4.1.

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(1) The Supreme Court decides again on patent-eligibility after almost thirty years: Bilski, Mayoand Alice
Between 2010 and 2014, a trilogy of Supreme Court decisions changed completely the landscapeof patent-eligibility in the United States.
The first decision is Bilski v. Kappos (2010), where the Supreme Court began demolishing theexisting system by questioning the validity of both State Street’s “useful, concrete and tangible
result” test and the older (but still in use) “machine-or-transformation” test26. In this regard, theCourt states that both tests can be useful tools to assess the patent-eligibility of a claimed
invention, but they are not absolute, and a case-by-case approach is preferable. However, indenying the patent-eligibility of the claimed invention, the Supreme Court slightly mixed patenteligibility criteria (natural laws, natural phenomena and abstract ideas) with some of thepatentability concepts.
The second case about patent-eligibility is Mayo Collaborative Services v. Prometheus
Laboratories27. This case is not about software patents but involves a claimed invention regarding
a method to identify the correct dosage of a medicine to administer to patients. The Supreme Court
states that the applicants try to secure a patent on a natural law involving the correct dosage of adrug that has been known for many years. In this decision, the Supreme Court also admits that the§102 novelty enquiry might sometimes overlap with the §101 patent-eligibility analysis, but that
this is not a good reason to eliminate the Section 101 investigation entirely in favor of a“patentability-oriented” approach.
The third case about patent-eligibility, Alice Corporation v. CLS Bank International28, is once again
directly related to software patents. In examining the patents, the Supreme Court reorganizes some of
the concepts already expressed in Mayo and tries to create a more defined test to assess patenteligibility. This is what the subsequent literature and the courts will call Mayo-Alice two-step test:“First, we determine whether the claims at issue are directed to one of those patent-ineligible
concepts. If so, we then ask, “[w]hat else is there in the claims before us?” To answer that question,
we consider the elements of each claim both individually and “as an ordered combination” todetermine whether the additional elements “transform the nature of the claim” into a patent-eligible
application. We have described step two of this analysis as a search for an “‘inventive concept’”—i.e., an element or combination of elements that is “sufficient to ensure that the patent in practiceamounts to significantly more than a patent upon the [ineligible concept] itself.”29
26 See Bilski v. Kappos, 130 S. Ct. 3218 (2010).
27 See Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U.S. (2012).
28 See Alice Corp. Pty Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014).
29 Id. page 7 of the decision.

viFollowing this test, the Supreme Court finds that mere generic computer implementation of theabstract idea of risk hedging fails to show any “inventive concept”, rejecting any sort of “anyhardware approach”30.
(2) The current situation after Alice
After Alice was decided by the Supreme Court, the United States witnessed a tremendous increasein software patents’ invalidations, both at the district court level and at the appeal (Federal Circuit)level31. Such a trend started to be seen in a less “pessimistic” way after the opinion of the CAFC in
DDR Holdings, LLC v. Hotels.com 32 and seemed to decrease in 2016, when three cases about
software-related inventions were decided in favor of the patentee: Enfish, LLC v. Microsoft
Corporation33, Bascom Global Internet Services34, Inc. v. AT&T Mobility LLC and McRO Inc. v.
Bandai Namco Games America Inc.35.
These new decisions, however, do not have to be seen as a fundamental change in the Federal
Circuit’s approach towards software patents or patent-eligibility in general. Just a few days after
McRO was decided, the CAFC rendered another opinion in Intellectual Ventures v. Symantec
Corp.36 in which it clarified once again that inventions merely embodying abstract ideas but that
do not teach a specific, non-conventional, way to apply such idea do not deserve the monopolistic
protection granted by the patent system.
As it is evident from the Intellectual Ventures case, Mayo-Alice’s two-step test offers no brightline
rule regarding patent-eligibility of software patents, but a mere case-by-case approach.
Finally, once the patent-eligibility test is passed, the next steps are novelty and non-obviousness,
which are not analyzed very differently from what the patent law and the USPTO guidelines
instruct.

30 Id. pages 15 and 16 in particular.
31 See generally Robert R. Sachs, Two Years After Alice: A Survey of the Impact of a "Minor Case" (Part 1), 2016 available at

http://www.bilskiblog.com/blog/2016/06/two-years-after-alice-a-survey-of-the-impact-of-a-minor-case.html (last visited on
November 14, 2016) for a review and some statistics on this trend, as well as http://www.uspto.gov/patent/laws-andregulations/examination-policy/2014-interim-guidance-subject-matter-eligibility-0 (last visited on November 14, 2016).
32 DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1255 (Fed. Cir. 2014).
33 Enfish, LLC v. Microsoft Corp., 2016 U.S. App. LEXIS 8699, 2016 WL 2756255 (Fed. Cir. May 12, 2016).
34 BASCOM Global Internet Services, Inc. v. AT&T Mobility LLC, No. 15-1763 (Fed. Cir. June 27, 2016).
35 McRO, Inc. v. Bandai Namco Games America, Inc., No. 15-1080 (Fed. Cir. Sept. 13, 2016).
36 Intellectual Ventures I LLC v. Symantec Corp., 838 F.3d 1307, 120 U.S.P.Q.2d 1353 (Fed. Cir. 2016).

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III. A comparison with the current EPO and U.S. approaches
1. Software Patent-Eligibility
As the previous paragraphs highlight, at the patent-eligibility phase inventions are treated slightly
differently in Japan, Europe and in the United States.
(1) Japan
Starting from Japan, we have seen that the invention is examined as a whole in order to assess
whether we are dealing with a creation of technical ideas utilizing laws of nature. However, when acomputer program is present in the claims, it is not enough to recite general hardware components
to make the computer program patent-eligible, but it must be clear from the claims that hardware
and software work together. At the same time, it is not necessary that a computer program be tied
to some machine or hardware: Art. 2 of the JPA recognizes that software programs can be patented
even “per se” (as product inventions), as long as they utilize the laws of nature.
(2) Europe
In Europe, in principle if the invention “as a whole” points to an excluded category (such as
computer programs), such an invention may not be patent-eligible. However, both the case law andthe most recent EPO Guidelines confirm that computer programs may be patent-eligible evenwhen claimed “as such”, provided that they produce “further technical effects”.
It should also be noted that the technical Boards of Appeal of the EPO have recently adopted a socalled “any hardware approach”: Except for when a computer program is claimed “as such”, it isusually sufficient to mention some sort of hardware in connection with the software to make thecomputer program invention patent-eligible.
(3) United States
In the United States, from 2010 to the present, there have been several changes with regard topatent-eligibility. The current standard is the previously mentioned “Mayo-Alice test”.
This newly coined test, interpreted many times (and in slightly different ways) though the case lawof district courts and more significantly of the Federal Circuit, goes directly to the “essence” of theinvention, making novelty and non-obviousness considerations a recurrent part of this analysis. Asviii

a consequence, mentioning technical/physical components or linking the claimed invention to aparticular technological environment (computer network, telephone network etc.), is not enough topass the new test, even when an interaction between software and hardware is clearly specified.
2. Software Patentability
Amongst the patentability requirements, the most important one is non-obviousness / inventive
step, since novelty and industrial applicability are rarely a problem and easy to meet.
(1) Japan
In Japan, once the patent-eligibility analysis is successfully passed, inventive step is of course thenext hurdle for software patents. The invention in this phase is once again examined “as a whole”,
so, once the eligibility has been determined, if the solution which is offered to the problem has
inventive step, the invention is granted a patent. Therefore, it does not matter whether the physicalcomponents are not inventive and the core of the invention resides in some abstract ideas, in new
information etc. If the patent-eligibility analysis has determined that the interaction between
software and hardware was a meaningful one, every overall solution which shows an inventive
step is potentially patentable.
(2) Europe
As already mentioned, the most important part of software patent examination is the analysis of theinventive step. Even here, the EPO guidelines specify that an invention must be considered as awhole. However, differently from the previous evaluation, since the invention represents atechnical solution to a technical problem, only the features that contribute to the “technicalcharacter” of the invention can be taken into account. It does not matter whether those features aretechnical or non-technical when individually considered (e.g. a mathematical equation, a computer
program etc.), but it does matter that, considered together, they contribute to the technicalcharacter.
It seems therefore that the invention is not really examined “as a whole” but differentiating
between elements pertaining to Article 52.2 excluded and non-excluded categories.

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(3) United States
In the United States, the invention is examined “as a whole”, an expression which is specificallymentioned by the relevant statute37, to see whether it was obvious for the PHOSITA or not. Several
criteria and tests are used by examiners and judges depending on the situation38. What is importantis that there is no separation between technical and non-technical elements in this phase. The
separation between abstract/non abstract and between natural laws or phenomena and theirapplication is done at the patent-eligibility phase.

37 See 35 U.S.C. 103.
38 See for example the USPTO Manual of Patent Examining Procedure, Section 2141 and seq.

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