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mplex issue (Plotkin 2004). Under UK law, the Copyright Design and Patents Act 1988 (CDPA), protects software under the law of copyright (Merges, Menell & Lemley 2003). Although this is a powerful form of protection against an authorised copying of code, it may not be adequate to protect novel underlying ideas behind the software. For example, although copyright prevents competitors from taking the whole or a substantial part of the software code, it does not prevent a competitor from mimicking the novel concept behind the software system and taking these concepts to develop its own software (Davis 2007).

Theoretically patent protection should address the inadequacies of copyright as a means of protecting novelty (Vaver & Bentley 2004). The purpose of patent protection is to encourage and fuel innovation and the practical use of inventions. However, the issue of whether software should merit patent protection has remained a contentious issue with inconsistent approaches internationally.

Under UK law, the PA does not provide patent protection for anything that consists, of a method of doing business or a programme for a computer per se (Section 1(2) PA). The European Patent Office (EPO) on the other hand has adopted a liberal interpretation to patent protection of software by excluding software patent protection unless they have “technical effect”(Article 52 of the European Patent Convention). US law goes further in favour of a presumption of patent protection by requiring software to have “practical utility,” (35 U.S.C. 101) however neither the US or EPO position provides guidance on what constitutes technical effect or practical utility for the purpose of patent protection.

Despite the EPO and US move towards recognition of software patentability, its application in practice has remained contentious and inconsistent. Although the UK Patent Office has adopted and amended its guidelines in accordance with the EPO position (Patent Office Guidelines at available at www.patent.gov.uk), it begs the question as to how useful this is in practice when the EPO has preferred to take an ad hoc approach to patent protection of software instead of providing substantive guidance (Muir, Brandi-Dohrn & Stephen Gruber 2006).

The problem is compounded by the fact that debate on software patentability has justifiably focused on what constitutes “patentable subject matter” as defined under national laws (Plotkin 2004). The requirement of function, novelty, inventive step and industrial use is essential to filter claims that fail to qualify for patent protection in order to protect inventions (Muir, Brandi-Dohrn & Gruber 2006).

US patent legislation applies a categorical approach to patentable subject matter, according to five categories of subject matter, namely processes, machines, articles of manufacture, and compositions of matter all merit patent protection. The European Patent Convention (EPC) and the PA's approach although wider in definition, can have a limiting effect as the requirement of “industrial application” without any guidance or specified non-exhaustive categories creates uncertainty as to what might merit patent protection.

To exacerbate the uncertainty, the European approach expressly excludes computer programs, however only “as such”. Whilst clearly welcome instead of outright exclusion, it fails to add any light as to when a computer p