The European Patent Convention after stating that to be patentable an invention must be new and involve an inventive step also provides that the invention must be susceptible of industrial application, and sets out a list of developments that shall not be considered as inventions as follows:

The prohibition applies only, however, if the forbidden subject matter is claimed "as such". [16] More complicated provisions apply to medical treatments, as discussed below. In addition to this group of developments not to be regarded as inventions, the Convention also contains prohibitions on two classes of invention:

Almost all activity under this heading has been in four areas: inventions relating to computer programs, pharmaceuticals, biological inventions and data dissemination.

3.1 Computer Related Inventions

The European Patent Convention itself states:

These prohibitions are, however, limited by the proviso that they apply only to the extent to which a European Patent application or European patent relates to such subject matter "as such". Pressure from the computer industry led to an early revision of the strict approach that the EPO originally intended to take on the question of patentability of computer related inventions.

This change in approach was reflected at the Appeal Board level in Vicom Systems Application[19] which related to a method of digitally processing images using a computer. The Board held that a claim directed to a technical process which is carried out under the control of a program (whether the implementation is in hardware or in software) should be allowable under Article 52 (2) (c) and (3) EPC, since it cannot be regarded as relating to a computer program "as such".

Soon after this, in the Koch case an Appeal Board held that an X-ray apparatus incorporating a data processing unit which controlled the operating and supply circuits of the apparatus to ensure that exposure parameters were not exceeded was patentable. The Board pointed out that an invention must be assessed as a whole. If it makes use of both technical and non-technical means , the use of non-technical means does not detract from the technical character of the overall teaching.

Therefore as long as the program relates to the solution of a technical problem, the fact that the program is a key element in the invention does not preclude patentability as long as the invention is new, involves an inventive step and has industrial applicability because such an invention is not claiming the program "as such".

On the other hand, in IBM/text processing, [20] it was held that the only problem solved by a program to detect and correct contextual homophone errors (e.g. "there" instead of "their") was an essentially mental one and as such the invention was not patentable.

In some languages (e.g. Arabic,) the form of a letter depends upon whether the letter appears at the beginning, middle, or end of a word. An invention relating to the display of the correct form of the letter on a visual display screen by control of the display by a computer program was held to be unpatentable because the problem solved by the computer program was not a technical one but merely "the making of the mental registering" of the letters easier. [21]

Most recently [22] the relevant Technical Board of Appeal has held that there was no per se prohibition on the grant of patents for computer product media bearing a computer program or even a computer program element comprising computer program code means as long as the object of the program was to produce a technical effect beyond the mere running of the program. It could see no logical difference in distinguishing between situations in which a program was claimed indirectly as a computer controlled method or apparatus and a claim to the program itself. The board formulated its view as follows:

a computer program claimed by itself is not excluded from patentability if the program, when running on a computer or loaded into a computer , brings about, or is capable of bringing about, a technical effect which goes beyond the "normal" physical interactions between the program (software) and the computer (hardware) on which it its run.

Furthermore, the Board is of the opinion with regard to the exclusions under Article 52(2) and 52(3) EPC, it does not make any difference whether a computer program is claimed by itself or as a record on a carrier.

Thus, it can be seen that in response to industry's needs, the Appeal Board has effectively almost completely reversed the negative view of computer-related inventions taken by the original draftsmen of the Guidelines.

3.2 Medical Inventions

A similar change in approach has been experienced in the pharmaceutical field. Here, however, those seeking change had not only the Guidelines to contend with, but also the wording of the Convention itself. The Convention states in Article 52(4) that:

Methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practiced on the human or animal body shall not be regarded as inventions.

The position is complicated, however, by a proviso in Article 54 (5) that states that this prohibition shall not exclude patentability for any "substance or composition for use in [such] a method" even if previously known for some other purpose as long as that purpose was not a method of treatment or diagnosis practiced on a human or animal body.

So far as known compounds having no previous "medical history" were concerned, it fairly quickly became the practice to take the express wording of the convention as to what was patentable and draft claims in the form:

1. Compound X for use in treating Y or
2. Compound X for therapeutic use.

Of course, none of this helped with respect to the second medical use. However, the same issue had come before the Swiss Patent Office which had concluded that, the wording of the Convention did not preclude the grant of claims in the form:

The use of compound X for the manufacture of a medicament treatment of disease Y.

This was so even if compound X had previously been used for treatment of some other disease. [23]

In Esai's application, [24] the Enlarged Board of Appeals of the European Patent Office agreed with the Swiss and upheld the grant of a claim in this form. The Board did, however, emphasize that:

It is to be clearly understood that the application of this special approach to the derivation of novelty can only be applied to claims to the use of substances or compositions intended for use in a method referred to in Article 52(4).

So-called second medical use or "Swiss form" claims are, however, only acceptable in the case of new uses of a medicament. They have not been allowed for other types of medical treatment such as a new use of a known laser surgery system. [25]

The prohibitions on medical treatment claims have been narrowly construed in other cases. In Flow measurement/Summers, [26] an Appeal Board reasoned that the purpose of Article 52 (4) is to ensure that a physician or veterinarian can practice his profession freely without being restricted by fears of patent infringement. This being the case, if the claim in question did not restrict the physician in selecting appropriate administration of medicaments it did not fall within the patentability bar.

Essentially similar reasoning has also been applied to find that a non-invasive method for determining pH or temperature in a particular area of a body by magnetic resonance determination was patentable because the results obtained could not be used directly by a physician to make a diagnosis. [27]. A somewhat different approach was taken in Contrast agent for NMR imaging/Nycomed [28] where a second medical use type claim was allowed for a use of magnetically responsive material for the manufacture of a diagnostic contrast agent for use in a particular method of in vivo nuclear magnetic resonance imaging. In this case, the Board focused on the need for the doctor to be involved in the administration of the contrast agent so as to make the steps taken sufficiently "medical" so as to preclude a claim to the diagnostic treatment itself.

On the other hand the Flow measurement decision was distinguished in Cardiac pacing/Teletronics [29] where it was held that in order to avoid the prohibition on claims to methods of medical treatment it was necessary that if the claim contained a method step (even if the claim was ostensibly directed to an apparatus - in casu a cardiac pacer characterized by certain method steps) it was essential that none of the method steps should be a method for treatment of a human or animal body by way of therapy surgery or diagnosis. In the present case certain signals interpreted by the device controlled the output of the pacer which was applied to the human body to obtain a therapeutic effect. This contrasted with the Flow measurement case where there was no functional link between the method step in the claim (measuring a flow rate) and the therapeutic treatment applied.

3.3 Biological Inventions

As the EPO's case law has developed it has become clear that two provisions of the EPC are relevant when considering the patentability of biotechnology inventions.

Article 53(a) denies patentability to inventions whose publication or exploitation would be contrary to ordre public or morality. The significance of this will become apparent later.

Article 53(b) of the European Patent Convention provides that patents shall not be granted for "plant or animal varieties or essentially biological processes for the production of plants or animals." The article goes on to state, "this provision does not apply to microbiological processes or the products thereof."

So far as the question of patentability of higher life forms is concerned, it has been held that the prohibition on protection on plant or animal varieties is a limited one which applies only if that which is claimed is a new sub-species and not if what is claimed is a more general genetic modification of a class of plants or animal. In assessing whether such modified plants and animals are patentable, however, the question of whether the grant of patents for animals might be contrary to public order or morality must be considered. [30] Such issues also arise in connection with the patentability of genes. In Relaxin/Howard Florey Research Institute [31] the EPO had granted a patent in which claim 1 read as follows: "A DNA fragment encoding human H2-preprorelaxin, said H2-preprorelaxin having the amino acid sequence set out in Figure 2".

In Plant cells/Plant Genetic Systems [32] the morality issue and also that of ordre public were raised. It was held that:

inventions, the exploitation of which is not in conformity with the conventionally accepted standards of conduct pertaining to [the culture inherent in European society and civilization] are to be excluded from patentability as being contrary to morality.

The opponents submitted evidence from a survey of farmers in Sweden and a Swiss public opinion poll in support of the contention that the grant of patents for plants would be immoral or contrary to ordre public. The board was not convinced, noting that "the results of surveys and opinion polls can fluctuate in an unforeseen manner within short time periods." Furthermore the board could see no moral distinction between modifying plant characteristics by genetic engineering and by traditional selective breeding. Genetic engineering simply made the modifications punctual and increased the number of modifications possible. In certain cases there might be a misuse or destructive use of this potential that would render an invention unpatentable as contrary to ordre public or morality. However, the production of herbicide resistant plants did not fall into this category, notwithstanding the fact that there was the possibility of undesired side effects (for example transfer of the herbicide resistant gene to weeds) that might result in damage to the environment. If, however, it could be shown that exploitation of an invention would "seriously prejudice the environment", a rejection on the ground that the invention was contrary to ordre public might be appropriate.

In 1998, the EU adopted a directive requiring that its member states harmonize their laws relating to the patenting of biotechnological inventions. The European Patent Convention is not a creature of the European Union and as such, directives of the European Union do not have any direct effect on the European Patent Office. However, as a practical matter since all member states of the EU are members of the EPC and the EPO is in effect competing for business with the national patent offices of these countries, directives of the EU have an effect on the EPO and the EPO has adopted rule changes to take account of the directive. The major features of the directive are summarized below.

To take account of this directive, the EPO has added new rules 23b, 23c, 23d and 23e to its Regulations. The new rules took effect on September 1, 1999. They may be summarized as follows:

3.4 Presentation of Data

An Appeal Board was confronted with a claim reading as follows:

A color television signal adapted to generate a picture with an aspect ratio of greater than 4:3 and in which the active-video portion of a line constitutes at least 85% and preferably 90% of the line period. [33]

Such a claim was held to be patentable. In the Board's view, the only issue to be decided was whether the television signal as claimed could be considered as being merely a presentation of information, such presentations of information being specifically banned from patentability under the European Patent Convention. The Board noted, however, that the prohibition applied only to such presentations "as such," and concluded that a television signal "inherently comprises the technical features of the TV system in which it is being used and if it is considered to present information then it represents exactly that kind of information which exhibits the technical features of the system in which it occurs." Thus, it was not merely a presentation of information as such. The Board also found that because the signal was a detectable physical reality, the mere fact that it was transitory did not preclude patentability.

3.5 Methods of Doing Business

Methods of doing business are grouped with methods of performing mental acts and rules for playing games as being unpatentable under Article 52. The early approach taken by the Boards of Appeal to such cases has been in line with that taken on computer program and data presentation cases. An example of the approach is given in the official headnote to the decision in IBM/Card Reader [34] which reads as follows:

A claim which. when taken as a whole, is essentially a business operation , does not have a technical character and is not a claim for a patentable invention...even though the claimed method includes steps which include a technical component. The true nature of the claimed subject matter remains the same even though some technical means are used to perform it.

The case involved the use of what was described as an "electronic application form" to determine whether the user was entitled to access to, for example, a cash dispensing machine.

More recently, however, following developments in the United states, the EPO has stated in a paper published on the Trilateral Web site shred by the EPO, the Japanese Patent office and the United States Patent and Trademark Office that its views on the patentability of business methods are as follows:

It seems, therefore, that the way is open to claims to intangibles before the European Patent Office provided that such intangibles are closely linked to a technical problem of some sort. It is to be expected, however, that the law in this area will develop very much on a case-by-case basis or possibly by a revision of the EPC itself.