Netherlands Software Patent Hearing Next Month

by Brenno J.S.A.A.F. Winter

In the US, the software patent situation is out of control. British Telecom has a patent on hyperlinking on the Internet and is shaking down ISPs for royalties. Amazon.com is using its "one click shopping" patent, on a mechanism where cookies and databasing are used to "recall" some data, to attack web sites. Every week brings another economic disaster as a result of US courts' decision to allow patents on software.

Is it the same in Europe? No. If you look at the European Patent Office you discover there is currently no way of patenting software or software parts. But the European Patent Office is currently trying to change the European situation into a situation comparable to the US.

Even though software patents are illegal in Europe, a few sneak into the patent system. Förderverein für eine Freie Informationelle Infrastruktur (FFI), a European pro-GPL watchdog group, came up with a list of 30,000 patents that describe software in an indirect way to get around the ban on patenting software. In this list we see pro-Linux supplier IBM with the most, at 1,842, followed by a lot of other names. Tim Conway of European IT Federation EISA acknowledges this and is unhappy with this situation, because now the rules are not applied straightforwardly. Therefore he would like to see the exclusion of software removed. The Dutch Economics Administration would also like to see more clarity. Spokesman Jan van Diepen said, "How can anyone be against more clarity?".

"That's not a valid way of thinking", says Luuk van Dijk, spokesman on software patents for VOSN, the Dutch Open Source Society "I think the regulation is straightforward and clear. To have 30,000 software patents already shows that the Patent Office is not enforcing the rules. By removing the exclusion you do not solve anything. I compare it to assisted suicide. You don't remove murder and manslaughter from the law, just to solve that issue". VOSN considers patents to be a threat for open-source software development. "Small companies like my own have to go through a lot of patents after programming a solution. Basically patents that were violated while I made my own solutions," van Dijk said.

The Open Source movement and IT companies having different and opposing views, the European Commission is investigating the issue itself. Also national governments haven't really made up their mind. Political parties are not done with the issue. In the Netherlands the issue is currently crucial. There is a parliamentary task force studying the matter. At the hearing on February 15th, both VOSN and FENIT, the Dutch IT company federation will have their say.

At this point the Socialist Party (SP), Christian Party (CDA) and Liberal Party were not able or willing to state their views for this article. Only the Dutch Labor Party (PvdA) wanted to talk. I spoke with spokesperson Rik Hindriks who had time, studied the subject and was clear in his comment: "In general patents are good, when you invest a lot of money in a product". But, according to his view, this is difficult in the software issue. He acknowledges the fact that in many cases it is hard to prevent trivial or ridiculous patents. Also, he wants to make sure that small groups or companies will have a fair chance of filing for a patent and enforcing it. According to him that is also a major issue. The PvdA wants to prevent large companies from buying justice.

But that doesn't mean the Netherlands do not listen to the VOSN. The VOSN itself was started after research by the Dutch Economics Department on the value of open-source software in 1999. Many of the GPLers involved are still in touch. The study was pretty positive on open source. More and more, the government in the Netherlands values open-source software and uses it. VOSN wrote a letter which was discussed by the parliament. Although the department's response was not all VOSN hoped for, still it lead to a discussion.

During my research I obtained a November 2000 brochure published by the Agency of Industrial Property, part of the Economics Department. This brochure states that patenting software is already possible in the Netherlands as long as it is a functional part of an invention. Examples given include the lookup of ZIP-codes, programs on telecommunications and software for processing financial payments. Business methods can also be patented. Although software as such is excluded, the impression is that patenting it in the Netherlands might be even easier than in other European countries. This would be substantially different from patenting software through a detour. If this is true, possibly the Economic Affairs Department may have a keen interest in having software patents. A number of Dutch patents could be ratified fully under European protection automatically. The December 15th response given by the Economics Department to Parliament on the VOSN letter did not discuss this fact. However, this might be a not-so-trivial force in the entire Dutch discussion.

Whatever the Dutch discussion does, the Netherlands are only one of the smaller members of the European Community, and their voice is heard but may be dimmed by larger countries. For this reason, it is interesting to see what happens in Germany. There, the government has some reservations on the issue. German courts have dismissed software patent cases on several occasions because they found them to be in violation of the rules. According to the VOSN, this is the real reason why the treaty from 1975 is under negotiation. "It was so clear why software used to be excluded back than. It was a different game. And those illegal patents will all of a sudden be legal". But the German government's view is definitely interesting. Just over a year ago, the GnuPG project was awarded 250,000 German marks (something like US$100,000). It shows that open source is definitely seen and people on a political level are aware of it. What will happen in the discussion is still in the dark.

Focus on Competition

Competition is a hot issue for the European Commission. There are several programs to ensure that markets are open and competition thus has a fair chance. The former foreman of the Dutch liberal party (VVD), Mr. Frits Bolkestijn, is currently responsible for policies in this respect. And FENIT is comforted by the fact that a strong body makes sure that monopolies obtained by patents are not exploited excessively. "Repeatedly a European judge indicated that competition is more important than having a patent", says Peter van Schelven. He's the FENIT lawyer who wrote two books on the issue, one in 1986 and one in 1995. He also points out that obtaining a patent in Europe is not as easy as in the US. Basically, you have to do three things in order to get a patent:

  1. The idea must be new and cannot be common use or published ever before.

  2. The idea must be applicable in the industry.

  3. The idea must bring something new to the industry.

VOSN says these rules are not always applied correctly. Van Schelven disagrees. When you patent something you have to publish it as well. That is giving something in return. Having a patent doesn't give you a right to abuse it. To the question of the small company fighting in favor or against a patent, Van Schelven responds that insurance can help bring a solution. He does, however, admit this insurance is pretty expensive.

February is an important month for the Netherlands. The mindset at the hearing on February 15th will help determine the future of software patents in Europe. If the Netherlands goes along, the focus moves to Germany. If the Netherlands will not go along, the future should be very interesting indeed. I have the feeling that this is not the last article I write on the issue.

Resources

Contact VOSN for information about opposition to software patents in the Netherlands.

Contact Luuk van Dijk at luuk.van.dijk.@xs4all.nl regarding opposition to software patents in the Netherlands.

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