Surely Business Methods Are Prohibited In Canada? - Ramifications Of The Amazon Appeal Decision On Doing Business (Methods) In Canada

A typical business method patent contains claims to innovative, computer-implemented technology related to the practice, administration, or management of an enterprise, usually involving the processing of data specific to enterprise operations. Industries potentially subject to business methods can include e-commerce, advertising, loyalty and reward programs, insurance and banking and other financial services. In some countries, business method patents are recognised as important assets for small, medium and large corporations.

On November 24, 2011, the Canadian Federal Court of Appeal quashed the Commissioner of Patents' stated "tradition" of excluding business methods from patentability. In the appeal of Commissioner of Patents v. Amazon.com Inc., the Court kept the door open to the patentability of business method patents in Canada, but refrained from ruling on whether the "one-click" patent at issue was patentable. The Court sent the matter back to the Commissioner to expedite further examination of Amazon's patent application based on the Court's reasoning.

As a result of the Court's decision, it is clear that business method patents have won a beachhead in the Canadian patent landscape that can be used for their further advancement. The Court's decision will clearly impact the business practices of the financial and insurance industries in Canada, evidenced by the involvement as Interveners in the appeal of the Canadian Life and Health Insurance Association Inc. and the Canadian Bankers Association. Through the Court, the mindset of the Canadian patent system towards computer-related technology has been formally introduced to the 21st century and business methods have been acknowledged as having their rightful place at the patent table alongside more traditional technologies.

Impact of the Court's decision on the Commissioner of Patents

The examination and issuance of patents in Canada is overseen by the Commissioner of Patents, whose historical policy was to prohibit business method patents. However, this policy was deemed by the Court as "incorrect in law". The Court reasoned that the Commissioner of Patents should not have permitted its stance on business method patents to cloud its judgment during examination of the Amazon patent application, in particular when used as justification to exclude consideration of the claimed invention against the correct statutory provisions of novelty and inventiveness over state of the art...