Software Patents in Australia

Software Patents in Australia

Software Patents in Australia

Software patents have been available in Australia for over 20 years, but recently the Australian Patent Office has adopted a negative practice towards certain types of computer implemented inventions, such as financial systems or gaming systems.

The negative practice is founded on a belief that schemes or business methods do not become patent eligible subject matter just by implementing them in a computer. The practice has been the subject of two Federal Court decisions which are now both on appeal to the Full Federal Court.

In the latest decision, RPL Central,1 the Federal Court reaffirmed once again that software patents are available in Australia, and that the Patent Office’s negative practice was incorrect and did not have a sound basis in Australian law. The Court found that an automated process for gathering evidence to assess competency did constitute patent eligible subject matter.

Background to patent eligibility

Patent eligible or patentable subject matter in Australia is inexorably linked to the High Court’s celebrated judgement in NRDC2 which has been described as a watershed.3

In RPL Central, the Federal Court confirmed NRDC made it clear any attempt to set forth prescriptive requirements is impermissible as it is necessary to be flexible to allow for excitingly unpredictable and emerging inventions to be patentable.4 NRDC considered an exact formula was not to be used, as patentable subject matter is a mere threshold consideration, particularly when any validity inquiry remains to be determined quite separately, and on different criteria,5 e.g. novelty and inventive step.

RPL Central’s invention

The invention under consideration facilitated improvements in existing recognition of prior learning processes by enabling the automatic generation of a user interface to gather evidence from a prospective candidate, relevant to credit or exemption towards any qualification or unit offered across a wide range of training organisations.  The evidence facilitated the assessment of the competency of the candidate.6

The Australian Federal Court’s decision in favour of RPL Central

The Court considered and rejected all of the Commissioner of Patents’ submissions.

In applying the principles of NRDC, the Court found that the invention did belong to the useful arts rather than the fine arts, and that it did have utility in practical affairs and solved a problem in the field of economic endeavour.7 The Court also made clear that there was no binding Australian authority that provides a different test for a method claim8 as opposed to a method and device claim .

Significantly, the Court found that each of the computer-effected steps of the claimed invention constituted or gave rise to a change in the state or information in a part of a machine, and therefore produced a physical effect in the sense of a concrete effect or phenomenon or manifestation or transformation, as required by the Court’s decision in Grant.9  The Court considered the statement in Grant to be a useful précis of the way in which the artificial state of affairs requirement may apply to computer programs, in accordance with the principles set out in NRDC.10

Furthermore, the Court emphatically rejected the Commissioner’s arguments that the physical effect required must be significant or central to the purpose or operation of the claimed process.  The Commissioner felt that this requirement was supported by earlier decisions. In fact the Commissioner has been applying the requirement to reject a number of patent applications for computer implemented inventions relating to financial systems or gaming systems.  The Court made it clear that none of the earlier decisions articulated a separate or new requirement of substantiality of physical effect.11

The Court noted the Commissioner submitted that without this, or some other limiting principle, then any method operated on a computer would fulfil the artificial state of affairs requirement.12 However the Court indicated that fear is not a valid objection.13

The Commissioner also submitted that the invention could be performed without the use of a computer, and if one was to strip away the computer aspects of the claims, one would only be left with a method for performing an aspect of a business.  In response the Court said one should not subtract from the invention any aspect of computer implementation, and then determine whether what remains is proper subject matter.14 The computer is an essential part of the invention claimed, as it enables the method to be performed.15

Another argument advanced by the Commissioner, that the steps did not involve anything that is foreign to the normal use of computers, was also rejected by the Court as a requirement not imposed by any of the binding authorities.16 This is to be considered under the separate requirements of novelty and inventive step.

The Court also distinguished its earlier decision in Research Affiliates17 on the basis that the patent applicant had accepted the only physical result generated by the method of the claimed invention was a computer file containing a generated index, and that the specification and the relevant claims did not disclose how to produce the index in question.18 In contrast, the specification and claims in issue in this case provided significant information about how the invention is to be implemented by means of a computer and the computer was integral to the invention as claimed.19


  1. RPL Central Pty Ltd v Commissioner of Patents [2013] FCA 871, 30 August 2013
  2. National Research Development Corporation v Commissioner of Patents (1959) 102 CLR 252
  3. Supra n1, Para 64
  4. Ibid, Paras 106 and 107
  5. Ibid, Paras 108 and 109
  6. Ibid, Para 44
  7. Ibid, Para 128
  8. Ibid, Para 136
  9. Ibid, Para 143
  10. Ibid, Para 144
  11. Ibid, Para 147
  12. Ibid, Para 148
  13. Ibid, Para 149
  14. Ibid, Para 157
  15. Ibid, Para 158
  16. Ibid, Para 159
  17. Research Affiliates LLC v Commissioner of Patents [2013] FCA 71
  18. Supra n1, Paras 169-171
  19. Ibid, Para 172