Are business methods patentable in Nigeria?

The trademarks, patents and designs laws are currently implemented by the Trademarks, Patents and Designs Registry under the Federal Ministry of Commerce.

The body responsible for the implementation of the Copyright Act is the Nigerian Copyright Commission (NCC), which is under the supervision of the Federal Ministry of Justice.

Over the years, applications for IPR in Nigeria have been fraught with difficulties, such as missing documents and files and duplication of registration. However, the Nigerian Trademarks, Patents and Designs Registry is in the process of setting up its official website which will make provision for digital registration, hence minimising the challenges faced during registration.

Only duly accredited firms and agents will be allowed access to online registration, searches and other operations in relation to registration of trademarks, patents and designs via the registry’s portal.

A debate has arisen in the country relating to the patentability of business methods, biological processes for the production of plants and animals and discoveries of scientific nature, which the act specifically lists as not patentable in Nigeria.

However, the appropriateness of granting a patent for a business method tops the list of debates.A business method may be defined as a collection of related, structured activities or tasks that produce a specific service or product (serve a particular goal) for a particular customer or customers.An example of a business method will be a system for verifying the authenticity of a product.

A business method patent is a class of patent which discloses new methods of doing business. Business method patents are a relatively new type of patent and there are divergent opinions on their propriety. The patentability of a business method differs depending on the legal jurisdiction. The debate on business method patents is not limited to Nigeria but constitutes a current topic in other countries of the world.

A case in point is the recent US Supreme Court decision in Bilski v Kappos, which has generated discussions and debates among IP experts around the world. In Re Bilski, the petitioners’ patent application sought protection for a claimed invention that explains how buyers of commodities in the energy market can protect, or hedge, against the risk of price changes.

Claim 1 describes a series of steps instructing how to hedge the risk, and claim 4 places the claim 1 concept into a simple mathematical formula. The remaining claims explain how claims 1 and 4 can be applied to allow energy suppliers and consumers to minimise the risks resulting from fluctuations in market demand. The patent examiner rejected the application on the grounds that the invention is not implemented on a specific apparatus but merely manipulates an abstract idea and solves a purely mathematical problem.

The Board of Patent Appeals and Interferences agreed with the patent examiner’s decision and affirmed it. The Federal Circuit affirmed it in turn. The US Court of Appeals for the Federal Circuit heard the case en banc and rejected its prior test laid down in State Street Bank & Trust Co v Signature Financial Group Inc for determining whether a claimed invention was a patentable ‘process’ under the Patent Act, ie, whether the invention produced a ‘useful, concrete, and tangible result’, and held that a claimed process is patent eligible if: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. It concluded that the ‘machine-or-transformation test’ is the sole test for determining patent eligibility of a ‘process’ under §101.

The Supreme Court, however, decided that while the particular invention in Re Bilski was not eligible for patent protection because it covered an abstract idea, business methods in general were not excluded from patentability. Further, business method inventions were distinguished from computer-implemented or software inventions.

The court considered that computer-implemented inventions were more eligible for patent protection since they inherently include or relate to a computer and are therefore likely to have at least some technical considerations. The position of IP law in Nigeria is presently unclear on the issue of the patentability of business methods. Officials at the Patent Registry in Nigeria seem to have divergent views on the subject.

Several patent applications made with the intent of obtaining patents for business methods have been treated differently by officers of the registry. Some of these applications have been granted, while others have been refused on the grounds that they are not patentable. Unfortunately, there is no case law that sheds light on this grey area of IP law in Nigeria.

Under Nigerian law, what is considered a patentable invention by the Patents and Designs Act is not much different from that of many other countries, particularly the UK and the US. Section 1 of the Patents and Designs Act in Nigeria defines a patentable invention as “an invention that is new, results from inventive activity and is capable of industrial application, or an invention that constitutes an improvement upon a patented invention which is new, results from inventive activity and is capable of industrial application”.

It is noteworthy that the act does not make any specifi c provision for business methods, so it may be presumed that a consideration of the patentability of a business method will be based on certain criteria such as whether such method is new, results from an inventive activity and is capable of industrial application.

In light of the act, a business method may not be unpatentable just because it is a business method.

The suggested approach should be that a business method be evaluated like every other patent application. If a business method is new, results from inventive activity and is capable of industrial application, then it ought to be patentable.

This was the view taken by the US Federal Circuit in State Street Bank & Trust Co v Signature Financial Group Inc supra. A major reason why business methods may not be patentable in Nigeria is that in many cases, the inventions are solutions to existing problems or methods for making business transactions easier and more effective.

Where a combination of existing processes or technological know-how are used to achieve this goal, the result may be that the only aspect of the invention that may be considered ‘new’ is the idea of putting together existing processes and/or technological know-how to solve the problem.

For instance, an invention such as a system and method for verifying the authenticity of a product for which a patent was granted in Nigeria is a case in point. The invention makes use of mobile phones, short message service (SMS), short codes and a database of computergenerated personal identification numbers (PINs). All of these may be considered as existing technologies.

Where the test of patentability as provided by the act is used, the invention will have failed the test of being new. Also, an invention must result from an inventive activity. An inventor is considered to have taken an inventive step if the invention is not obvious to a person skilled in the art. The invention in question may also fail this test because it may be difficult to show that there was any inventive activity.

A combination of existing technology is a task that people skilled in information technology may well be able to come up with. In fact, many telecommunications companies within and outside Nigeria have used this technology in various ways.

The condition that every patentable invention should be capable of industrial application is one that should be reconsidered by our law makers or clarified by case law in Nigeria. This provision seems outdated in light of developments around the world.

The provision may well provide a sufficient basis for evaluating processes similar to those in the ‘industrial’ age, for example, inventions grounded in a physical or other tangible form. However, it is doubtful whether the test should be the sole criterion for determining the patentability of inventions in the ‘information’ age.

Under Nigerian law the condition for an invention to be capable of industrial application is similar to the position of the en banc court in Re Bilski. It is suggested that the definition of industrial application should be broadened in order to accommodate and grant protection for inventions which may not necessarily be in physical or tangible form but are ideas that are new and result from inventive activity in accordance with the act.

There are presently a number of cases before the Nigerian courts in which the patentability of business methods has come up for determination. It is hoped that judicial pronouncements in these cases will clarify and make more certain this aspect of IP law in Nigeria. In conclusion, it is hoped that the debate on this issue in Nigeria may soon be resolved.

Tiwalola Okeyinka is an associate at ǼLEX. She can be contacted at: tokeyinka@aelex.com