Project

The German and European patent law do not allow patent protection for software solutions. However, so-called computer-implemented inventions – sometimes also called “embedded software“ – can be filed. The patent system is a main pillar of any innovation system and makes significant contributions to the economic and technological development in a country. There is evidence that countries with weak or little reliable patent systems (Ginarte, Park 1997; Park 2008) show a lower economic and technological performance in international comparison (Foray 2004; Kumar et al 2011). There is also empirical evidence that depending on the technological and economic development level of a country a matching patent system supports the further development (Encaoua et al 2006; Thompson, Rushing 1996; Thompson, Rushing 1999). A developing country may have none at all or a different need for a patent system than a developed economy focusing on innovation. With the development stage the patent system needs to develop.

With a patent the government awards a temporary monopoly to the patent holder on the exploitation of a technological solution (Adams 2006; Frietsch et al 2010; Frietsch et al 2012; Grupp 1997; Schmoch 1990). From an economic perspective a patent system offers planning security to the companies and research institutions, thereby encouraging investment in new technologies and innovations. So it makes a positive contribution to the development of the international competitiveness of an economy. Proponents of patent systems emphasize this planning certainty, clarity of the rules and the resulting incentives for innovation. The opponents of patents overall stress, that the creation of temporary monopolies just slows down the innovation activities and prevents the competition for the best technological solutions. They believe that the innovation performance could be increased by the abolition of patents.

In the field of software patents (Blind et al 2002; Blind et al 2004; Blind et al 2005), this dispute between proponents and opponents of patents had shown most clearly in recent years – similar drastic and bold confrontations of critics and supporters, although with slightly different arguments, were only visible in relation to genetic engineering. The argumentation with respect to genetic engineering is that these are not inventions in the strict sense, but discoveries that are in principle excluded from patentability. The opponents of software patents argue in a similarly way, as they want to deny these computer programs to have a technological content and technological orientation. Concerning this dimension of technological content the computer-implemented inventions fall into a “gray area“ between technology and software. Again, there are opponents, who want to abolish the patenting of computer-implemented inventions, as it is currently practiced in Germany and Europe, essentially with the above two arguments of a supposedly hampering innovation monopoly or a lack of technology orientation.

The aim of this study on behalf of Technology, Innovation and Investment Council e.V. (TIIC) is, on the one hand, to carve out the significance of computer-implemented inventions for the German and European economy with a special focus on SMEs. On the other hand, it will also be investigated, what consequences are to be expected by a change in the patent law towards the abolition of patent protection for computer-implemented inventions and what would be the impact on the international competitiveness of German and European companies.

The study has three main parts. First, it discusses the legal status quo as well as the implications of a possible change from a legal perspective. The second part involves an empirical investigation of the structures and trends in patent protection of computer-implemented inventions. For this purpose different databases will be used. In the third part, finally, a survey of patenting and non- patenting companies is carried out concerning their patent behaviour and their assessment of the implications of a possible change in the law. Here, small and medium-sized enterprises (SMEs) are particularly in the center of interest.