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PATENTABILITY OF BUSINESS METHODS IN INDONESIA ( IP Updates 008/11 )


Patentability of business methods patents has long been a longstanding subject of many debates throughout development of patent laws worldwide. In the United States, for instance, where business methods as well as computer programs had enjoyed a significantly higher possibility of being granted patent protection, situation gets a bit more restrictive in recent days following an en banc decision of the US Court of Appeals for the Federal Circuit in In re Bilski in 2008. On the contrary, across the Atlantic remote possibility is there for patenting business methods since "schemes, rules and methods for doing business" is not regarded as patentable invention under the European Patent Convention.

In Indonesia, the patent law evidently stands above the similar grounds with their European counterparts when it comes to patentability of business methods. Article 2 of the Law no.14 of 2001 concerning Patents provides that patent shall be granted upon invention that meets the requirements of novelty, having inventive steps, and industrial applicability. Under Article 7 of the same law, several kinds of "invention" are excluded from patentability, such as methods of treatment for humans and/or animals, scientific and mathematics theories and methods, as well as living organisms.

Interestingly enough, while the Indonesian patent law shall grant patent to eligible invention save from several excluded kinds of invention as mentioned above, business methods are not even regarded as belong to the category of "invention". Under the main heading of "General Section" in the Elucidation of the Patent Law, "rules and methods to conduct business activities" is considered as fall outside the scope of the term "invention" for the purpose of the Patent Law, along with, among others, computer programs and aesthetic creations; and thus ruling out any chance of patentability for said subject matters.

As a bill for patent law amendment is now being polished and currently being in the stage of taking further opinions and inputs from general public, particularly stakeholders of patent protection system in Indonesia, one thing that is quite certain is that the position of not allowing patent for business methods would very likely to remain unchanged under the amended law.

Nevertheless, one problem left is that "business methods" itself is not given any clear definition as the current patent law evidently does not further address the issues of what would fall into the legal meaning of "rules and methods to conduct business activities". This indeed leaves open some degree of legal uncertainty, which is further amplified by the facts that opportunity has yet to come to sufficiently put the question into actual tests before the courts of law. As everybody in the field would have been aware of, the number of patent litigations in Indonesia is of an insignificant rate.

At the end of the day, it is indeed very important that restriction on the patentability of business methods in Indonesia could be given clear legal definition and boundaries within the statutory law on patents. Accordingly, one should expect that providing the same under the upcoming amendment of the Law no. 14 of 2001 on Patents would give a great relief to current uncertain situation.



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