Software patent bill favours small firms

BRUSSELS: A European Union law that would make it easier for technology firms to raise capital from their inventions was cast into doubt on Wednesday after legislators voted through changes to restrict its scope.

Critics feared the draft proposal to place software patents on a firmer legal footing would expose smaller firms to heavy litigation costs and fail to boost software research spending.

Members of the European Parliament passed the bill but included a raft of amendments, which they said would ensure patents were not used to block competing innovations.

The changes risk irking the bill's original authors at the EU's executive Commission and scuppering the whole proposal. Internal Market Commissioner Frits Bolkestein had earlier said he would not support the bill if it were heavily altered.

Current European rules say software cannot be patented -- except that in practice it can. While software cannot be patented as such, there are legal precedents for patents to be granted for inventions that make use of software.

Making this clear in a new law might have started off as an legal tidying-up exercise, but it has since turned into a heated debate over how to ensure that the EU, avoids the kind of problems that are faced in the United States.

Many European observers argue that U.S. law grants patents for inventions that are too obvious or are not really inventions at all, such as online bookseller Amazon's famous "one click shopping".

But making software patenting more usual practice in Europe threatens the livelihood of small software developers, who lack the legal resources to track outstanding patents as they mix and match programming code from disparate sources.

RAFT OF AMENDMENTS

To tackle these problems, members of the European Parliament in Strasbourg amended the Commission's proposals to ensure that patents are not used to block competing inventions.

The altered bill now passes back to the Commission and will then be discussed again in Parliament. If approved, EU ministers will vote on the final version and then it can become law.

"There is already legal uncertainty as to what software should be patentable, so restricting the scope of these new rules will limit the confusion and controversy which has dogged this legislation," said Elly Plooij-van Gorsel, a legislator involved in drafting some of the amendments.

"I am delighted that MEPs supported amendments to ensure that patent law cannot override interoperability, which is in the interests of free competition and end users," she added.

But these amendments raised the prospect that the European Commission, which drafted the bill, might kill the directive.

Commissioner Bolkestein told lawmakers at a first reading debate on Tuesday that the Commission would not be able to support the proposals if they were heavily changed.

"Many of these amendments are fundamental, and there is a very realistic prospect of failure if the Parliament chooses to accept them," Bolkestein said.

A Commission spokesman said it was too early to say whether Bolkestein would support the modified proposal but drew attention to Bolkestein's earlier remarks.

© Reuters