Reducing patent duration

What this entry documents is not a solution.
This practice may be ineffective or useless in the long term.
ESP's position is that abolition of software patents is the only solution.

In response to the argument that 20 years is too long for software to be restricted by patents, it has been suggested that the term of patents for software be reduced to a much shorter amount of time, such as 3 or 5 years.

While true that this would help reduce harm, and would be especially useful for unblocking standards, software patents can still impose considerable burden to people during a short-timed window. Though not a perfect solution, and despite difficulties of introducing a law that limits software patent length, this idea should not be overlooked.

Unlikely but not impossible

Article 33 of the TRIPS agreement requires that all contracting states provide a minimum duration of 20 years to their national patent. Given that the majority of the world's countries are bounded by TRIPS, it is very unlikely that policy makers will introduce a law that violates the treaty.

That said, a shorter duration for patents is sensible. In fact, it was a topic of heated debate among legal and economic scholars for some decades. It has since seen renewed interest in recent years because of the many problems of the flat 20-year term.^:800

It is a misconception that 20 years is somehow a rigid part of the definition of the patent. In 1994, before TRIPS, several countries had shorter terms for patents. During the Uruguay negotiations round of the TRIPS agreement, some countries also proposed shorter terms. Early drafts of the agreement suggested that a duration of 20 years would only apply to pharmaceuticals, whereas all other fields would be covered for 15 years. The idea of using different terms for different fields is crucial; based on empirical evidence, some countries advocated that the duration of patents should be flexible. Instead, the final version introduced a non-discriminatory clause, meaning that all fields of "technology" are covered by the 20-year term.^:796–800

Criticism of uniform patent terms

As early as late 1960s, economists have conducted research on the connection between patents and social welfare, based on benefit-cost ratios.

Award-winning economist William Nordhaus looked at the "optimal patent life" and found that there was little effect on welfare from extending patent terms "beyond 6 or 10 years". Follow-up work by F.M. Scherer proposed a flexible, product-specific patent system, with extensions where needed:

A "best of both worlds" policy recognizing these relationships would tailor the life of each patent to the economic characteristics of its underlying invention. This might be achieved through a flexible system of compulsory licensing, under which the patent recipient bears the burden of showing why his patent should not expire or be licensed at modest royalties to all applicants three or five years after its issue.

Nordhaus' prediction was proven correct by more recent economical studies finding that strong patent systems have only managed to retard progress with many negative effects. Since these finds concern all types of patents, it is even more absurd for software to be restricted for such a long period of time.

In general, even pro-patent people have commented on the patent system's lack of flexibility. Richard Posner brought up the huge discrepancy between the software and the pharmaceutical industry when discussing the patent system. In an otherwise pro-software patent article, Lester Thurow made the case for an "optimal patent system" that is not "one-size-fits-all", acknowledging that software deserves a reduced patent term:

The optimal patent system will not be the same for all industries, all types of knowledge, or all types of inventors. Consider, for example, the electronics industry and the pharmaceutical industry. The first wants speed and short-term protection because most of its money is earned soon after new knowledge is developed. The second wants long-term protection because most of its money is earned after a long period of testing to prove a drug’s effectiveness and the absence of adverse side effects.

Only some harm reduced

Reducing the term of software patents would be a success, but it is not ESP's ultimate goal. Ben Klemens notes that software patents can cause harm even if they lasted a single day because of their retroactive effect allowing patent ambushes.

Since the software market operates at famously rapid speed, the length of a patent is effectively infinite. Some propose that patents on software should expire more quickly than the standard 20 years, perhaps after 2 or 3 years. But even if a patent were to last for a single day after being granted, the issue would remain because many patent protections are retroactive to when the patent was first filed. Since a savvy applicant can keep a patent lingering on USPTO desks for the better part of a decade (the so-called submarine patent; [...]), the only way to achieve truly short durations would be to allow some patents to expire before they are granted. This poses a few practical difficulties, to say the least.

Related pages on ESP Wiki

• 20 years is too long

External links

• Wikipedia's article on the term of patent