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[ossig] PS3: PIKOM's Conference. Software Patents in Malaysia: Part 1

Written by Yoon Kit:



I had the opportunity to attend the PIKOM Conference: Reinvent Business
Strategies Through Technology held in the Kuala Lumpur Convention Centre
(13-14th July 2006). Unfortunately I could only attend the second half
of the second day, which was a shame as there were quite a few talks I
wanted to hear. 

However I did manage to catch a couple of very good talks. The first is
by Ng Wan Peng from MDeC and the other by Deepak Pillai from
haryatideepak law firm.

Wan_peng Ng Wan Peng talked about "Policy considerations in the
patentability of computer implemented business methods." She stressed
very clearly that what she was about to present was the findings of a
study MDeC commissioned in 2005 and may not necessary be the position
MDeC holds officially. In the presentation, she outlined the reasons for
the MSC, and one of them is that it promises to be a leader in
Intellectual Property (IP) and cyber laws.

Current Malaysian laws are silent on the status of Software Patents, in
that it is probably allowed if the patent demonstrates novel, innovative
and useful qualities. With that, a well drafted application for software
patents would probably be granted. However it is very clear that
Business Methods are NOT patentable.

She notes that the nature of the Software Industry is sequential, in
that developments progresses cummulatively, there is high obsolescence
in that it moves much faster than other industries and it depends on
innovation and high knowledge 'spill-over'. 

A survey done in the UK in 2001 showed that for Nations which have
strengthened their Patent Laws indicate that there is no correlation
with increased innovation. It also mentions that Patents does not reward
nor encourage innovation. Neither has there been a spike in
'innovations' in the US when they altered their Patent Laws in 1994 to
allow for Software Patents. Innovation continued at their respective
rates as before the change.

The MDeC report also noted that in the Malaysian Software Development
environment, we are still a net importer of technology. It asked these

Will Software Patents help:

      * increase Foreign Direct Interests?
      * reduce the deficit in Technology balance of payments?
      * reduce transactional and social costs?

For all three queries, the answer was a resounding 'No'.  A strong legal
framework is an important but relatively small criteria in selecting a
country for investments. The other criteria comes from able workforce,
stable government, language and cultural preferences and other major
economic reasons. IP protection is important, but not as important as
the rest. 
The Balance of Payments will definitely swing not to the favour of
Malaysia as her citizens will now have to respect Software Patents of
other nations. Similarly we will have to pay for these 'services' which
guarantee a monopoly position over our home-grown technology which means
shutting down of our local service providers; wasted opportunity costs
for us now, as we are deprived of alternatives of more efficent
solutions. It also means a wider digital divide where poorer citizens
and government bodies cannot afford the licenses fees and will have to
do without computerization.

To conclude, MDeC's position on Software Patents are:

      * Retain status quo: Software Patents are possible on stringent
        criteria: if it shows innovation and novel ideas
      * Business Methods are clearly not Patentable
      * and a review of position in 3 years time ...

So the talk was both good and dissapointing at the same time. Good
because it gives the impression that the people at MDeC do understand
the problems of software patents and its detrimental impact on the local
software industry. Dissapointing because they have not taken a clearer
and harder stance against Software Patents like other goverments namely
the United Kingdom, India and the European Union. A weak stance by the
main technology body of Malaysia (MDeC) severely weakens the Malaysian
position as the Ministry of Trade walks into the negotiation room on the
US-FTA when it comes to the "Intellectual Property" concerns.



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