Does State Street lead to Europe? The case of financial exchange innovations
AbstractWe study whether and to what extent financial exchange innovations are in practice patentable in Europe. We find that exchange-related applications initially increased significantly after the State Street decision but subsequently decreased. The clear majority (65%) of applications come from the U.S. investment banks and exchanges themselves being among the most active innovators. But patents were not easly granted in response to these applications (only 3% of them led to valid patent). The high post-grant opposition rate (41%) for granted patents indicated that competitors tightly monitored each other’s patents. The evidence, as augmented with clinical case studies, supports the notion that, for an invention to pass the inventive step requirement for obtaining a European patent, it should have technical features for solving a sufficiently challenging technical problem. Our evidence suggests that patentability standards for financial methods have not weakened in Europe in the aftermath of the State Street decision and that the inventive step requirement constitutes a major obstacle for applicants to overcome in order to obtain a financial exchange patent in Europe.
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Bibliographic InfoPaper provided by Bank of Finland in its series Research Discussion Papers with number 22/2009.
Length: 53 pages
Date of creation: 22 Sep 2009
Date of revision:
Publication status: Published as Komulainen, Mari and Tuomas Takalo, 'Does State Street lead to Europe? The case of financial exchange innovations' in European Financial Management , 2013, pages 521-557.
finance patents; financial innovation; business method patents; patent policy; management of intellectual property in financial services;
Find related papers by JEL classification:
- G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
- G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
- K29 - Law and Economics - - Regulation and Business Law - - - Other
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
- O34 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-11-21 (All new papers)
- NEP-CFN-2009-11-21 (Corporate Finance)
- NEP-EEC-2009-11-21 (European Economics)
- NEP-INO-2009-11-21 (Innovation)
- NEP-IPR-2009-11-21 (Intellectual Property Rights)
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