Last updated: 
28 November 2018

Patentable business methods

A patent may be granted for a business method where the method directly involves a physical form or device to bring about a useful product.

The application of technology for conducting a business method must be directly involved in a substantial way, not an incidental way. In other words, technology used to implement a business method should be improved in some technical way.

A computer implemented business method must be also be new and inventive in order to be patented.

If your invention meets these criteria, you may consider seeking patent protection.

Non-patentable business methods

A scheme or plan by itself is not suitable for a patent.

For instance, a method of raising funds by seeking sponsors to donate products, and conducting a raffle of those products, cannot be patented. This is because it does not specifically involve any artificial application to implement the scheme.

Importantly, the mere presence of science or technology (for example a computer) in a claimed invention is not enough to be patentable. The computer must be directly involved in the creation of the useful product in the sense of some technical improvement in computer technology.

A business scheme that results in a written contract reflecting obligations of certain parties will not become patentable subject matter simply because a physical transformation occurs when the contract is documented using paper and ink.

Similarly, a change in the memory state of a computer used to generate, store or transmit the contract, or the use of email to communicate it, is unlikely to alter the fundamental characteristics of the method. These things would not make the method patentable.


For a further explanation and some examples of patentable and non-patentable business methods see our IP for Digital Business resource on computer implemented inventions. 


On 13 September 2019, the Full Court of the Federal Court issued their decision in Encompass Corporation Pty Ltd v InfoTrack Pty Ltd [2019] FCAFC 161. The decision addressed whether a computer-implemented invention described in innovation patents 2014101164 and 2014101413 was a manner of manufacture. The Full Court found that it was not a manner of manufacture.  
The Commissioner has considered the decision. The decision does not alter current examination practice in relation to computer implemented inventions (software patents). That practice is set out in the Manual and on the website. 
Given the considerable interest in this matter, the Commissioner will take this opportunity to review the Manual to ensure that our practice and procedures are reflected clearly and consistently in the relevant sections.
We will consult with key stakeholders on any proposed changes.

Resources for practitioners

The following resources are available to assist attorneys and legal practitioners when prosecuting business method inventions relating to information and computer technology (ICT).