Dawn of Blockchain Technology in the Indian Patent Regime

Jatin Trivedi

Digital technologies are doing for the information revolution what the steam engine and related technologies did for the Industrial Revolution. Digital technologies are opening up new information frontiers with unprecedented speed. With the advent of inventions in the field of Artificial Intelligence and Internet of Things (IoT), Block Chain based technologies are pushing the digitized world to new levels. The interplay between this digitized world and patent law is increasing rapidly.  Block chain technology is evolving and is challenging current patent protection regimes.

Block chain is basically a list of transactions that may be encrypted and protected to ensure that prior transactions in the list are not modified. New transactions are verified and added to the list. Some block chains utilize open source client software for verifying and adding cryptocurrency transactions. Cryptocurrency is a subset of virtual currency that uses cryptography to enable funds transfer between two parties without the involvement of a third party. Blockchain may be used to exchange value over the internet without an intermediary.

Block chain patents can be likened to software patents since they attempt to protect a combination of application software and cryptography. It has been argued that block chain related inventions may not be patentable since most block chain based services merely take an old idea (blockchain technology) and come up with a new use.  Blockchain services are primarily based on algorithms involving mathematical theory and/or computer programs.  Algorithms and computer programs may not be considered as inventions within the meaning of the India Patents Act as per Section 3(k). Section 3(k) of the India Patents Act lists that ‘computer programmes, per se’ are patent-ineligible subject matter.  There has been much debate about the interpretation of the term ‘per se’.  

Recent patent grants involving computer related inventions by the Indian Patent Office appear to indicate that such inventions are patentable under Section 3(k) if they provide technical solution to a technical problem by providing a practical application or an improved technical effect of the underlying software. A blockchain based service invention may be eligible for patent if on careful consideration of the claims, the invention offers a technical solution to a technical problem and improves significantly on the underlying technology. But it is still a question regarding how such improvements are to be determined.  Blockchains, as have been discussed before, are lists or databases for recording transactions. The 2017 CRI Guidelines specifically states that a ‘database’ is a ‘computer programme per se’ and hence it is excluded from patentability under Section 3(k).

Whether or not block chain based inventions are eligible is up for debate. One side of the Indian Law allows computer related inventions and on the other side prevents obtaining patents to certain such inventions. Patent lawyers have noted that open-source technologies like bitcoin are not easy to patent, and even if patents are approved, they are not always easy to defend. On a broad-spectrum, it can be said that there is a dire need to streamline current laws and guidelines in a way which may permit these system generated inventions to be granted patents. Per contra, with several hindrances and confusions still existing over patentability and other aspects, deeper assessment of the issues is required.

With the upcoming changes for the Industrial development in India, and with the various government initiatives supporting the same, we may hope that this thin line between the computer related inventions and technically advanced computer related invention may mark the DAWN OF BlOCK CHAIN TECHNOLOGY PROTECTION IN THE INDIAN PATENT REGIME.