Opinion: Right to patent software critical to Kiwi entrepreneurs

16 July 2010
Home-grown innovation relies upon the ability to patent software applications.  We know this because one in five of the software patents that have been awarded in New Zealand to date are owned by Kiwi entrepreneurs.

Our research has located 1,057 New Zealand software patents of which 222 – or 21 per cent – are held by New Zealand individuals, New Zealand companies or New Zealand institutions.  This is twice the ‘going rate’ as, according to the Ministry of Economic Development, New Zealanders own only 10 per cent of all patents granted here.

So what does this mean?

It means the recent news that the Government intends for computer programs inventions to be patentable the same way as in Europe is important to New Zealand industry.  And not just for multinational companies as some have claimed.

It was a near run thing.  The aim was always to bring New Zealand law into line with international norms and Australia, Singapore, the UK, the European Union, Japan and the USA all allow patent protection for inventions that are implemented in software. 

The committee’s intention was clearly that inventions which relied on “embedded software” – software that is built into a physical device and/or contributes to a piece of machinery – would still be patentable. That would generally be the case under European law. But the New Zealand Bill, as reported back from select committee on 30 March, did not make this clear stating simply that “A computer program is not a patentable invention”. 

The Government has since given assurances that the Intellectual Property Office of New Zealand (IPONZ) will draft guidelines to provide that software which has “a technical purpose” can be patented.

Clear wording is important but it will succeed in the real world only if the protections it offers are sufficient to give investors the confidence to back Kiwi ingenuity which relies upon a software application.

Software patents are only a small part of the Bill and account for just three per cent of all New Zealand patents.  But they are integral to the success of the New Zealand economy.

IPONZ does not yet provide full text searching of all granted patent specifications so it was difficult to get a breakdown of the figures.  Our approach was to use the international patent classification (IPC) system which gives some indication of the area of technology to which a granted patent relates.  Each of the 1,057 patents we identified as software patents was allocated at least one of the IPC codes associated with computer related inventions. 

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