Journal of Intellectual Property Law & Practice, 2021, Vol. 16, No.
3 ARTICLE 247
Three routes to protecting AI systems and
their algorithms under IP law: The good,
the bad and the ugly
Katarina Foss-Solbrekk
I. Introduction
Artificial Intelligence (AI) applications are transforming
society, promising to help people make better, more
informed decisions and therefore promote greater pro-
ductivity, improved efficiency and raise general well-be-
ing.1 As part of the rapid uptake, algorithms now
underpin an increasing number of important decisions
about individuals’ lives, influencing credit scoring,2 ad-
mission to university,3 and even when people should be
discharged from hospital4 or how long they should be
sentenced to jail.5 However, this raises serious ethical
and legal concerns. One of the important questions is
what type of intellectual property (IP) protection these
algorithmic models currently attract in the EU. And,
moreover, what protection they should attract, for the
benefit of both industry and society at large.An initial
problem is that the legal focus is generally on the out-
put of these systems, not on the AI system itself, ie the
The author
 Katarina Foss-Solbrekk is a doctoral (DPhil)
candidate in IP law at Oxford University. She
holds an Advanced LLM in Law and Digital
Technologies from Leiden University and an
LLM in EU IP Law from Stockholm University.
This article
 This article reviews how Artificial Intelligence
(AI) systems can be protected under three IP
1 OECD, Artificial Intelligence in Society (OECD Publishing Paris 2019)
<https://doi.org/10.1787/eedfee77-en>.
2 M Hurley and J Adebayo, ‘Credit Scoring in the Era of Big Data’ (2016)
18 YJLT 148, 149–160.
3 T Simonite, ‘Meet the Secret Algorithm That’s Keeping Students Out of
College’ (WIRED, 7 July 2020) <https://www.wired.com/story/algo
rithm-set-students-grades-altered-futures/> accessed 11 February 2021.
C The Author(s) 2021. Published by Oxford University Press.
V
This is an Open Access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/), which
permits unrestricted reuse, distribution, and reproduction in any medium, provided the original work is properly cited.
frameworks: copyright, patent and—taking IP in
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its broader sense—trade secrets laws. In contrast
to other contributions, the focus of this work is
how the AI system itself is protected, not its
output.
 AI systems are primarily protected as trade
secrets, as attempts to protect AI systems under
copyright and patent laws encounter difficulties.
In copyright law, algorithms are excluded from
protection under the EU Software Directive.
They also struggle to meet the author’s own in-
tellectual creation criterion, in addition to not
necessarily being a creative expression of said
creation. Acquiring patents for AI systems is also
difficult as these systems may fail to satisfy the
technical character and inventive step require-
ments. However, although trade secrets law is
the most common avenue to IP protection, an
alternative and increasingly successful route is to
patent AI systems as computer-implemented
inventions.
 The impact of trade secret protection for AI sys-
tems in terms of transparency and accountability
is also discussed. Because trade secret protection
subsists for as long as the information remains
confidential and requires actors to take steps to
ensure confidentiality, trade secret protection
facilitates algorithmic opacity. This has serious
consequences.
4 R Robbins and E Brodwin, ‘An Invisible Hand: Patients Aren’t Being
Told About the AI Systems Advising their Care’ (STAT, 15 July 2020)
<https://www.statnews.com/2020/07/15/artificial-intelligence-patient-
consent-hospitals/> accessed 11 February 2021.
5 R Wexler, ‘Life, Liberty, and Trade Secrets: Intellectual Property in the
Criminal Justice System’ (2018) 70 SLR 1343, 1346–56.
doi:10.1093/jiplp/jpab033
Advance Access Publication 18 February 2021
248 ARTICLE
underlying algorithmic models and algorithms.
Furthermore, insofar as legal protection is available,
rightholders currently shield these mathematical tools
under the trade secrecy privileges afforded by the EU
Trade Secrets Directive (EUTSD).6 This poses a serious
risk. Trade secret laws were not designed to provide IP
protection: indeed, many EU Member States do not
even see trade secrets as part of the IP domain.7 As
Aplin states, ‘it is not self-evident that IP includes trade
secrets’.8 The fact that it is the most common path to
protect property rights in algorithmic models is there-
fore problematic. The confidentiality afforded to com-
panies to protect competitive advantages makes illegal
practises frequently tied to algorithmic decision-
making, such as discrimination, harder to detect.9
Recent examples of the ‘lack of social balancing mecha-
nisms’10 include the algorithm employed to help with
visa application decisions by the UK’s Home Office,
which inadvertently discriminated on the basis of
race,11 and the UK’s A levels algorithm that favoured
students from private schools over public schools.12
Because of trade secrets law, such discriminatory deci-
sions are not only harder to detect: they are also harder
to challenge.
The consequences are extremely serious and wide-
spread, even affecting matters of life or death. In the
US, Michael Robinson was sentenced to death, based
on evidence produced by computer software. Yet he
was not allowed to challenge, or even access, the source
code: the judge held that trade secrets law would take
priority.13 Similar problems are predicted to arise across
the pond. As things stand, trade secrets law will grow in
strength and scope because copyright and patent law
have been drafted specifically to exclude algorithms
from protection. Trade secrets law, therefore, which
was primarily intended to prevent breaches of
6 Directive 2016/943 of the European Parliament and of the Council of 8
June 2016 on the Protection of Undisclosed Know-how and Business
Information (Trade Secrets) Against their Unlawful Acquisition, Use and
Disclosure, OJ, L 157, 1–18; M Maggiolini, ‘EU Trade Secrets Law and
Algorithmic Transparency’ Bocconi Legal Studies Research Paper No
3363178 (2019) 1–16.
7 T Aplin, ‘Right to Property and Trade Secrets’ in C Geiger (eds),
Research Handbook on Human Rights and Intellectual Property (Edward
Elgar 2015) 426–27; For an analysis of the issue, see: J Schovsbo and T
Riis, ‘To Be And Not To Be and IPR – The Protection of Trade Secrets in
the EU’ (2019) 41 EIPR 401.
8 ibid; Contrast with Bently who states, ‘the idea that “intellectual proper-
ty” encompasses – or at least can encompass -
confidential information thus seems to have become increasingly preva-
lent’ in L Bently, ‘Trade Secrets: “Intellectual Property” But Not
“Property”?’’ in H. Howe and J Griffiths (eds), Concepts of Property in
Intellectual Property Law (CUP 2013) 76.
9 S Wachter, B Mittelstadt and C Russell, ‘Why Fairness Cannot Be
Automated: Bridging the Gap Between EU Non-Discrimination Law and
AI’ (3 March 2020) <https://ssrn.com/abstract¼3547922>; S Wachter,
Journal of Intellectual Property Law & Practice, 2021, Vol. 16, No. 3
confidence by ex-employees, has been largely subsumed
into IP law, creating rights and providing a convenient
mechanism for companies to fill the gap where classic
IP law fails. The result is that individuals are hit with
complete opacity and proprietorial unaccountability,
without even a fair use exemption.
This article aims to shed some light on how algorith-
mic systems are treated under copyright, patent and
trade secret laws, illustrating how EU law is subject to
an Italian epic spaghetti western gamut of ‘The Good,
the Bad, and the Ugly’. It shows that the current reli-
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ance on trade secrets is inappropriate, unnecessary and,
in short, a ‘bad’ solution. Copyright is not the answer
either, being at best an ‘ugly’ alternative because algo-
rithms’ technical functionality means they are likely to
fall short of constituting creative subject-matter,
according to EU case law. Rather, the ‘good’ way for-
ward is to recognize that it is patents that are specifi-
cally designed to protect technical inventions. Although
in its infancy, IP protection for algorithms under patent
law is expanding with its growing acceptance of
computer-implemented inventions (CIIs). This is the
preferable and logical route, providing the dual benefit
of avoiding the dangers of trade secrets law and also ac-
knowledging the novelty of AI.
II. Defining an algorithm and AI systems
Scholars do not agree about the definitional terms of
what constitutes an algorithm. Moreover, defining an
algorithm based on a single term, such as an abstract
state machine (data structures) or a recursor falls short
of encapsulating its entire scope, as ‘algorithmic duality
seems to be a fundamental principle of computer sci-
ence’.14 In simple form, however, an algorithm is, as de-
fined by Hill, ‘a finite, abstract, effective, compound
‘Affinity Profiling and Discrimination by Association in Online
Behavioural Advertising’ (2020) 35 Berkeley Technology Law Journal
(forthcoming) <https://ssrn.com/abstract¼3388639>.
10 TR Moore, ‘Trade Secrets and Algorithms as Barriers to Social Justice’
(Center for Democracy & Technology 2017) <https://cdt.org/wp-con
tent/uploads/2017/08/2017-07-31-Trade-Secret-Algorithms-as-Barriers-
to-Social-Justice.pdf>.
11 Foxglove, ‘Home Office Says it Will Abandon its Racist Visa Algorithm -
After We Sued Them’ (4 August 2020) <https://www.foxglove.org.uk/
news/home-office-says-it-will-abandon-its-racist-visa-algorithm-nbsp-af
ter-we-sued-them> accessed 20 January 2021.
12 ‘A-Levels and GSCEs: How Did The Exam Algorithm Work’ BBC News
(London, 20 August 2020) <https://www.bbc.com/news/explainers-
53807730> accessed 20 January 2021.
13 Commonwealth v Robinson, No.CC201307777 (Pa. Ct. C.P. Allegheny
City 4 February 2016).
14 MY Vardi, ‘What is an Algorithm?’ Communications of the ACM (2012)
55, 5.
Katarina Foss-Solbrekk  The good, the bad and the ugly
control structure, imperatively given, accomplishing a
given purpose under given provisions’.15
Algorithms can thus be viewed as a method consti-
tuting a sequence of steps used to calculate different
data variables to yield outputs. This way, algorithms
can ‘tell’ computers how to complete tasks when incor-
porated into computer programs.16 This process is en-
abled by code, which is the actual implementation
method of algorithms, achieved by delivering the algo-
rithmic instructions to computers in certain program-
ming languages.17 Computer programs thus comprise
codified sequences which express algorithms
(instructions).18
Algorithms have various control structures and are
therefore divided into algorithmic sub-categories, each
warranting a new definition depending on their control
function,19 eg ‘sorting’ and ‘searching’ algorithms.20 Of
particular importance are predictive algorithms.
Predictive algorithms are part of predictive modelling,
that is an approach, not a fixed process, designed to try
and predict future results based on historical data.21
They scour through big datasets searching for patterns
or correlations between different variables and the final
output to engender predictions.22 Machine learning, a
method by which computer systems learn from data
and then act autonomously with little to no human in-
tervention, usually aids this process. There are two
main categories of machine learning algorithms: super-
vised and unsupervised.
Unsupervised learning algorithms find hidden struc-
tures from unlabelled datasets, ‘as the aim is for the sys-
tem to group data that is similar’.23 Supervised learning
algorithms detect structures based on labelled inputs,
which is ‘tagged data’, and desired outputs.24 For exam-
ple, if the data comprises images, then such tags may
include gender, elephants, or watermelons. Supervised
learning algorithms are trained on labelled data to form
15 RK Hill, ‘What an Algorithm Is’ (2016) 29 PT 35, 35–47.
16 A Goffey, ‘Algorithm’ in M Fuller (eds), Software Studies: A Lexicon (MIT
Press 2008) 15, 15–17.
17 F Cramer, ‘Language’ in Fuller, ibid 168, 172.
18 A Rooijen, The Software Interface Between Copyright and Competition
Law: A Legal Analysis of Interoperability in Computer Programs (Wolters
Kluwer 2010) 12.
19 ibid.
20 TH Cormen, Algorithms Unlocked (MIT Press 2013) 27–60.
21 Future of Privacy Forum, ‘The Privacy Expert’s Guide to AI and Machine
Learning’ (October 2018) 7–17.
22 R Brauneis and EP Goodman, ‘Algorithmic Transparency for the Smart
City’ (2018) 20 YJLT 103, 107–69.
23 Datatilsynet, ‘AI and Privacy Report’ (2018) 8–9.
24 ibid, 8.
25 M Mohri, A Rostamiziadeh and A Talwalkar, Foundations of Machine
Learning (2nd edn, MIT Press 2018) 1–6.
ARTICLE 249
algorithmic models, ie AI systems, which may be ap-
plied to ‘unseen points’ to make predictions.25
Predictive algorithms are those most commonly
employed for the AI systems introduced into society.
Indeed, their influence is widespread. Their calculations
impact current events, as well as future ones, by deter-
mining criminal sentences, whether individuals are to
be granted loans or admitted to university, our ‘news-
feeds’ and furthermore. Sometimes these systems are
open source, but oftentimes rightholders seek compre-
hensive IP protection to protect their business models.
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The applicability of copyright is considered first.
III. Legal protection of algorithms under
EU IP frameworks
A. Copyright
Whether, and if so how, copyright applies to AI systems
sparks lively debate, particularly regarding the notion of
authorship.26 Selvadurai and Matulionyte note that ‘at
present, the nature and ambit of copyright protection
extended to works generated using AI differs across
jurisdictions’.27 How EU Member States protect the
algorithms themselves also varies, with algorithms be-
ing, eg protected in Italy28 but not in Germany.29 These
diverse practices paint a blurry picture of the current
framework, making this evaluation on the copyright eli-
gibility of the method or structure of algorithms all the
more important.
Because algorithms can be expressed as computers
programs and form part of software, there are two pos-
sible avenues by which they might attract copyright
protection: as ‘work’ or as computer programs.
Although Article 2 of the Berne Convention30 only
affords protection to ‘literary and artistic works’, mak-
ing no mention of computer programs, the TRIPS
Agreement31 assimilated the Berne Articles to
26 A Lauber-Rönsberg and S Hetmank, ‘The Concept of Authorship and
Inventorship under Pressure: Does Artificial Intelligence Shift
Paradigms?’ (2019) 14 JIPLP 570, 578; MC Buning, ‘Autonomous
Intelligent Systems as Creative Agents under the EU Framework for
Intellectual Property’ (2016) 2 EJRR 310, 312.
27 N Selvadurai and R Matulionyte, ‘Reconsidering Creativity: Copyright
Protection for Works Generating Using Artificial Intelligence’ (2020) 15
JIPLP 536, 536–43.
28 Case No 3742/2017, CISL, UIL, SNALS v MUIR, TAR Lazio, 21 March
2017.
29 Bundesgerichtshof, Judgment, 28 January 2014 Az.VI ZR 156/13.
30 The Berne Convention for the Protection of Literary and Artistic Works
1886.
31 Agreement on Trade-Related Aspects of Intellectual Property Rights,
Concluded as Annex 1C of the Marrakesh Agreement Establishing the
WTO 15 April 1994.
250 ARTICLE
accommodate for technological developments.32
Accordingly, Article 10(1) of TRIPS confirms that com-
puter programs ‘shall be protected’ under Article 2 of
the Berne Convention. Article 4 of the World
Intellectual Property Organization Copyright Treaty33
(WCT) reaffirms that computer programs fall within
the ambit of the Berne Convention. None of these in-
ternational instruments define computer programs, but
Article 2 of the WCT stipulates that ideas, procedures,
operational methods and mathematical concepts are ex-
cluded. Algorithms seem to fall outside its scope.
The EU has accepted TRIPS, and in 2001 adopted
the Infosoc Directive34 to inter alia implement the
WCT into its legal order. In 2009, the EU codified
the Software Directive35 (first adopted in 199136), with
the Court of Justice of the EU (CJEU) subsequently
establishing in UsedSoft that it is lex specialis to the
Infosoc Directive, meaning the rules laid down under
the Software Directive precede those in the Infosoc
Directive when the protected subject matter falls within
the ambit of the former.37 How algorithms fall under
EU copyright law is therefore first reviewed under the
Software Directive.
(1) No copyright protection under the EU software
directive
Article 1 of the Software Directive reaffirms that com-
puter programs are protected under the Berne
Convention but, as per WCT Article 2, also states that
‘ideas, procedures, methods of operation or mathemati-
cal concepts’ are not protected. Recital 7 clarifies that
computer programs include ‘programs in any form, in-
cluding those which are incorporated into hardware’,
while Recital 11 provides that only a computer pro-
gram’s expression is protected whereas the ideas and
principles of programs and its interface are not pro-
tected, nor is the ‘logic, algorithms and programming
languages’ underpinning those ideas and principles.
Algorithms are, once again, clearly excluded.
This interpretation is supported by CJEU case law.
In Bezpe c nostnı́, the Court confirmed that the
32 L Bently and B Sherman, Intellectual Property Law (4th edn, OUP 2014)
43.
33 WIPO Copyright Treaty, adopted 20 December 1996, WIPO Doc
CRNRIDC/94.
34 Directive 2001/29/EC of the European Parliament and of the Council of
22 May 2001 on the Harmonization of Certain Aspects of Copyright and
Related Rights in the Information Society, OJ, L 167, 10–19 (‘Infosoc
Directive’).
35 Directive 2009/24/EC of the European Parliament and of the Council of
23 April 2009 on the Legal Protection of Computer Programs, OJ, L 111,
16–22.
36 Council Directive 91/250/EEC of 14 May 1991 on the Legal Protection of
Computer Programs OJ L 122, 42–46.
37 Case C-128/11, UsedSoft EU:C:2012:407, [51].
Journal of Intellectual Property Law & Practice, 2021, Vol. 16, No. 3
copyright protection of computer programs only
extends to expressions ‘in any form of a computer
program which permits the reproduction in different
computer languages, such as the source code and the
object code’.38 The CJEU found that graphic user
interfaces (GUIs) do not equate to a computer pro-
gram, as envisaged under Article 1 of the Software
Directive.39 However, the Court noted that GUIs may
potentially attract copyright protection under the
Infosoc Directive.40 The CJEU reaffirmed that a pro-
gram’s functionality, programming language, prepara-
tory design materials, and the format of data files used
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in said programme fail to constitute a computer pro-
gram in SAS Institute,41 repeating that they may fall
under the Infosoc Directive.42 This is discussed in
greater detail below.
These cases demonstrate that the CJEU adheres
strictly to the definition provided by the Software
Directive. According to Bezpec nostnı́ and SAS Institute,
the source code of an algorithm attracts copyright pro-
tection, but the algorithm itself constitutes a computer
functionality. As above, Recital 11 states explicitly that
the Directive does not confer protection on algo-
rithms. Algorithms therefore fail to attain copyright
protection separately as part of the computer pro-
grams they underpin pursuant to the Software
Directive.
(2) algorithms, models and datasets under copyright
and related rights
To constitute ‘work’ under the Infosoc Directive, algo-
rithms must satisfy two criteria.43 First, they must be
original by being the author’s own original intellectual
creation.44 In its case law, the CJEU has elaborated that
this may be exhibited via reflections of personality,45
creative choices46 or sequences and combinations
wherein authors originally express themselves.47 More
recently, in Cofemel and Brompton Bicycle, the CJEU re-
iterated that for subject matter to be original ‘it is both
necessary and sufficient that the subject matter reflects
the personality of its author, as an expression of his free
38 Case C-393/09, Bezpe c nostnı́ Softwarová Asociace EU:C:2010:816, [28]–
[42].
39 ibid, [39]–[41].
40 ibid.
41 Case C-406, SAS Institute EU:C:2012:259, [38]–[46].
42 ibid.
43 InfoSoc Directive, arts 2–4.
44 Joined Cases C-403/08 & C-429/08, Football Association Premier League
and Others EU:C:2011:631, [97].
45 Case C-161/17, Renckhoff EU:C:2018:634, [14].
46 Case C-145/10, Painer EU:C:2011:798, [94].
47 Case C-5/08, Infopaq International A/S v Danske Dagblades Forening
EU:C:2009:465, [45].
Katarina Foss-Solbrekk  The good, the bad and the ugly
and creative choices’.48 Moreover, the CJEU held that
subject matter is not original ‘where the realisation of a
subject matter has been dictated by technical considera-
tions, rules or other constraints which have left no
room for creative freedom’.49 Evidently, an author’s
own intellectual creation necessitates some form of cre-
ative human contribution to be regarded as original.50
Secondly, the work must constitute an expression of
said creation.51 An expression need not be in perma-
nent form, but it must be ‘identifiable with sufficient
precision and objectivity’52 and not be dictated by tech-
nical functionality.53 To cite an example, in
Bezpec nostnı́, the CJEU held that the originality crite-
rion is not met if the expressions of the different
arrangements or configurations of the components
making up the GUI are dictated by their technical func-
tion.54 In Brompton Bicycle, however, where the CJEU
considered whether functional shapes attract copyright
protection, it expounded that copyright protection may
be conferred on subject matter,
even if its realisation has been dictated by technical consid-
erations, provided that its being so dictated has not pre-
vented the author from reflecting his personality in that
subject matter, as an expression of free and creative
choices.55
Accordingly, the CJEU held that works whose shape is
in part ‘necessary to obtain a technical result’ may be
subject to copyright, provided the work is original and
an expression of creative ability.56 But the presence of
other features that may lead to the same technical re-
sult does not necessarily overcome this technical func-
tionality barrier.57 Equally, if the components of
subject matter only differ by their technical function,
and are dictated by said function, then copyright pro-
tection is not possible as, according to the CJEU, ‘the
different methods of implementing an idea are so lim-
ited that the idea and the expression become indisso-
ciable’.58 This aligns with Levola, where the CJEU
confirmed that copyright is not granted ‘to ideas, pro-
cedures, methods of operation or mathematical
concepts’.59
48 Case C-833/18, Brompton Bicycle EU:C:2020:461, [23]; Case C-683/17,
Cofemel EU:C:2019:721, [31].
49 ibid, [24].
50 E Rosati, ‘The Monkey Selfie Case and the Concept of Authorship: An
EU Perspective’ (2017) 12 JIPLP 973, 976.
51 Infopaq (n 47) [39].
52 Cofemel (n 48) [32].
53 Bezpec nostnı́ (n 38) [48]–[50].
54 ibid.
55 Brompton (n 48) [26].
56 ibid, [38].
57 ibid, [35].
ARTICLE 251
Article 2(1) of the Berne Convention is more ‘open’
by awarding protection to works, whether scientific or
artistic, ‘whatever the mode or form of its expression
may be’. This Article could therefore open a door to en-
compass algorithms, although the CJEU has seemingly
closed it in its adjudications. Nonetheless, the EU is
obliged to comply with the Berne Convention under
the WCT,60 as confirmed by the CJEU,61 so Article 2(1)
may represent a window of opportunity because, as will
be shown, algorithms are unlikely to equal expressions
according to CJEU case law.
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Whether these two requirements are met depends on
the type of algorithm. Unsupervised learning algorithms
and models are unlikely to be regarded as an author’s
own intellectual creation because the developer plays a
small role in the algorithms’ functioning. These algo-
rithms run and learn without human supervision. A
work cannot equal the author’s own intellectual crea-
tion if the author does not actually create it.62
Additionally, as they are developed on unlabelled data,
the developer does not assemble the data in an original
manner reflecting creative choice. Unsupervised learn-
ing algorithms therefore fall short of amounting to
‘work’ under the Infosoc Directive. Supervised learning
algorithms similarly struggle to satisfy these two
requirements as they are often open source, thus not
original, with predominantly technical expressions. For
example, linear regression algorithms and logistic re-
gression algorithms connect sets of inputs to a single
output variable to reveal linear relationships in graph
format.63 Given the technicalities of such expressions
and their lack of originality these algorithms fall outside
copyright.
Moving on to algorithmic models, the most com-
mon are: regression-based models; classification-based
models; decision trees; neural networks; support vector
machines and expert systems.64 As neural networks
contain layers hidden from the developer, perform tasks
without prior-programming, and limit human control
over its correlations,65 they clash with the author’s own
intellectual creation criterion. Vector machines also
58 ibid, [27].
59 Case C-310/17, Levola Hengelo EU:C:2018:899, [39]–[40].
60 art 1(4).
61 Case C-277/10, Martin Luksan EU:C:2012:65, [59].
62 J Ihalainen, ‘Computer Creativity: Artificial Intelligence and Copyright’
(2018) 13 JIPLP 724, 724–28.
63 Future of Privacy Forum (n 21) 10–11.
64 S Finlay, Predictive Analytics, Data Mining and Big Data (Springer 2014)
104.
65 M Gerven and S Bohte, Artificial Neural Networks as Models of Neural
Information Processing (Frontiers in Computational Neuroscience 2017)
55–183.
252 ARTICLE
encounter difficulties with this criterion as they contain
neural networks.66 As a result, neural networks and vec-
tors machines are ineligible for copyright protection.
Regression-based and classification-based models, as
well as decision trees, comprise combinations of algo-
rithms developed on labelled data.67 Behind labelled
data are specific arrangement choices.68 Stacking algo-
rithms and assembling data to develop one comprehen-
sive model suitable for a specific purpose similarly
reflects ‘creative freedom’69 wherein the developer pro-
duces an original intellectual creation, arguably satisfy-
ing the first condition.70 Overcoming the expression
requirement presents a greater hurdle.
Express regression and classification-based models,
as well as decision trees, can all be expressed in many
different identifiable ways, such as via plain text or
graphical representations. Their expression is technical,
though, likely making it dictated by technical function
as per Bezpe c nostnı́. In Brompton Bicycle, however, the
CJEU took a wider approach by elucidating that the
technical function barrier may be overcome if the tech-
nical dictation does not prevent the author from reflect-
ing their personality in the work through free and
creative choices. This may prima facie represent an
opening for these supervised algorithmic models.
What the courts and legislators fail to recognize is
that a programmer performs free and creative choices
when writing and layering algorithms, and training said
algorithms on data chosen by that programmer in order
to create a composition. The choices one makes in this
regard change the model entirely, and as the program-
mer freely decides them: said choices reflect their per-
sonality. Afterall, it is the programmer’s originality that
leads to that composition, and no technical dictations
prevent them from doing so per se. These aspects
should confer the amount of creativity envisaged by the
CJEU in Brompton Bicycle.
But as the CJEU applies the technical function crite-
rion strictly, and as algorithms obviously contain such
functions, they are less likely to qualify for copyright
66 O Zamazal, ‘Machine Learning Support for EU Funding Project
Categorization’ (2019) 62 TCJ 1, 1–2.
67 Future of Privacy Forum (n 21) 10.
68 ibid.
69 Case C-604/10, Football Dataco Ltd. v Yahoo! UK Ltd EU:C:2012:115,
[39].
70 D Gervais, ‘Exploring the Interfaces Between Big Data and Intellectual
Property Law’ (2019) 10 JIPTEC 3, 26.
71 J Kalpokiene, ‘Supreme Court of Lithuania Rules that Draft GDPR
Documentation is Subject to Copyright Protection and Does Not Fall
Within the Exclusions from Protection Concerning Legal Acts’ (2020) 15
JIPLP 413.
72 Case No 10300/2020, Casucci v Unipol Assicurazioni S.p.A and Others,
Sent. Sez. 1 Civile Num. 10300 Anno 2020, 29 March 2020.
Journal of Intellectual Property Law & Practice, 2021, Vol. 16, No. 3
protection if earlier CJEU decisions are followed. As it
stands, copyright only protects the source code, not the
configuration that the source code is based upon, ie the
algorithms, algorithmic models, their data and training,
leading to the peculiar result of protecting the cover of
the book, but not its content.
The work in its entirety should be protected, as is
the case for other fields outside technology. Even
though models’ expressions ‘look’ technical, that does
not make the contents of that expression any less crea-
tive. It contains original and creative insights and
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should be valued as such. This reluctance to accord cre-
ativity to algorithmic models shows a bias against the
scientific process: technical function is an obvious part
of the process but does not denigrate the original, crea-
tive work of the programmer. Failing to recognize crea-
tive contributions on the basis that algorithms contain
technical functions seems arbitrary, especially in light of
the Supreme Courts of Lithuania and Italy affording
copyright protection to draft company GDPR docu-
mentation71 and technical regulation drafted by a law-
yer,72 respectively. If drafting the ways in which you
can comply with the law demonstrates creativity, it is
incomprehensible how constructing an entirely new
way of, for example, creating images does not.
Nor do data choices obtain copyright protection in-
dividually under the Database Directive.73 Indeed,
copyright may apply to data structures,74 but if they are
‘dictated by considerations, rules or constraints’75 they
lose eligibility, so they likely fail to satisfy the originality
threshold.76
Whether data achieves sui generis protection under
the Database Directive, which is comparable to but dis-
tinct from copyright, is debatable. The requirement of a
substantial investment behind obtaining, not creating,
data77 has allegedly caused scholars to concur that big
data and AI-related data fall outside its scope.78 But
Article 7 also grants protection to the verification or
presentation of data, provided there has been a substan-
tial investment, either quantitatively or qualitatively.
73 Directive 96/9/EC of the European Parliament and of the Council of 11
March 1996 on the Legal Protection of Database, OJ, L 77, 20-28.
74 P Filippi and L Maurel, ‘The Paradoxes of Open Data and How to Get
Rid of It? Analysing the Interplay Between Open Data and Sui-Generis
Rights on Databases’ (2014) 23 IJLIT 1, 4.
75 Football (n 69) [39].
76 Gervais (n 70) 27.
77 Database Directive, art 7; Case C-203/02, The British Horseracing Board
and Others v William Hill Organization Ltd. EU:C:2004:695, [41]–[42].
78 For an overview of the debate, see: M Leistner, ‘Big Data and the EU
Database Directive 96/9/EC: Current Law and Potential Reform’ in S
Lohsse, R Schulze and D Staudenmayer (eds), Trading Data in the Digital
Economy: Legal Concepts and Tools (Hart Publishing 2018) 1–3.
Katarina Foss-Solbrekk  The good, the bad and the ugly
The CJEU has yet to rule on these two options, but the
European Commission recently noted that the possibil-
ity of protecting big data, and data concerning
machine-generations and the Internet of Things as such
is open.79 Presented or verified machine learning data
may therefore plausibly receive sui generis protection
under the Database Directive. If so, third parties are
precluded from extracting substantial portions of data
from owners datasets.80 Consulting the database would
still be possible but general access may be impacted
nonetheless due to the rightsholder’s use and distribu-
tion rights.
Such a restriction of access would also subsist if algo-
rithms were eligible for copyright protection, as copy-
right may be invoked to protect confidential
information. In contrast to the opinion of Advocate
General (AG) Szpunar, who affirmed that using copy-
right to protect confidential is ‘entirely unrelated’ to
copyright’s scope,81 the CJEU found that the right to
freedom of information and freedom of the press fails
to justify a derogation from the rights afforded under
copyright outside the exceptions and limitations in
Funke Medien.82 This obstacle would loom if copyright
were to cover algorithms, begging the question: should
algorithms fall under copyright law?
One benefit of answering this in the affirmative are
the exceptions available under copyright, allowing algo-
rithmic information to be shared without piercing IP
protection. The CJEU confirmed that parties subject to
computer program licenses may study, observe or test
said program, notwithstanding the source code, with-
out infringing copyright in SAS Institute.83
Governments could, moreover, access the algorithm by
issuing compulsory licenses, as permitted under Articles
11bis-13 of the Berne Convention. Placing algorithms
and AI systems under copyright would, on other hand,
challenge copyright’s essence, which is built on the as-
sumption that inventors should be rewarded for the
creations they construct. Yet disallowing creations fail-
ing to satisfy the authorship criterion entirely puts the
applicability of copyright in this new digital era at risk.
It is not like copyright has not adapted to accommodate
for technological advancements before, such as with the
79 European Commission, ‘Evaluation of Directive 96/9/EC on the Legal
Protection of Databases’ SWD(2018) 147 Final, 23–25.
80 Filippi and Maurel (n 74) 5–6.
81 Opinion of Advocate General Szpunar in Case C-469/17, Funke Medien
EU:C:2018:870, [61].
82 Case C-469/17, Funke Medien EU:C:2019:623, [54].
83 SAS Institute (n 41) [61].
84 Correspondence with Dutch, British, Bulgarian, Polish, Spanish, Irish,
Hungarian, Slovenian, Luxembourgian, Maltese, Danish, and Italian
Patent Offices.
85 Correspondence with Croatian Patent Office.
ARTICLE 253
advent of the camera. But, currently, it appears that
algorithms largely fall outside the scope of EU copyright
law.
B. Patents
Patent protection has largely been unavailable to AI sys-
tems. However, as it will be shown, it is possible to ob-
tain patents for these systems if filed as CIIs, although
this route is not as widely used in practice as it could
be. Obtaining relevant information from the national
patent offices also proved hard: only the Finnish, Czech
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Republican, Lithuanian and Portuguese patent offices
were able to supply statistics on the patentability of AI
systems, whereas the others stated that they did not
have national statistics,84 or that such data was not
readily available for distribution.85
Patents give inventors exclusive rights that preclude
others from exploiting their inventions, and are filed ei-
ther as a product, method or use claims.86 To attain
protection, an invention must satisfy three main crite-
ria. First, it must be novel, which requires the invention
to not form part of the state of the art, ie that it is
unavailable globally prior to a patent application fil-
ing.87 Secondly, it must have an inventive step meaning
it is unobvious to a person skilled in the art.88 Thirdly,
it must have technical character, demonstrated by either
creating a technical effect which serves a specific techni-
cal purpose89 or through being adapted to a specific
technical implementation.90
Before turning to algorithms, it is important to note
that whether computer programs and mathematical are
at all patentable remains a contentious topic. Article
27(1) of TRIPS allows patents ‘for any inventions,
whether products or processes, in all fields of technol-
ogy’, whereas Article 52(2) of the European Patent
Convention (EPC), the legal framework for patents in
Europe, excludes mathematical methods and computer
programs (defined under the EPC as claims referring to
‘a sequence of computer-executable instructions’ that
specify ‘a method rather than the method itself’91) from
patentability. Yet the European Patent Office (EPO) has
issued more than 30,000 software patents since 1978,92
86 European Patent Convention EPA/EPO/OEB 16th edition, as amended
in 2016 (‘EPC’), arts 63–69.
87 ibid, art 54.
88 ibid, arts 52(1)–56.
89 T 0154/04, (Estimating Sales Activity/DUNS LICENSING ASSOCIATES)
of 15.11.2006.
90 T 0914/02, (General Electric Company) of 12.7.2005.
91 President’s Reference/Patentability of Programs for Computers, G 3/08
(12 May 2010) 11.2.5; T 494/07, (Currency Validator) of 13.05.2011.
92 European Commission, Proposal for a Directive on the Patentability of
Computer-Implemented Inventions – Frequently Asked Questions,
254 ARTICLE
with the EPO President also stating that computer pro-
gram claims are not excluded from patentability in
2010.93
With regard to algorithms, the EPO guidelines reaf-
firm that computational models and algorithms en-
abling AI and machine learning are generally non-
patentable, but if the patent claims consist of a method
‘involving the use of technical means’—such as a com-
puter—a technical character is conferred on the
subject-matter as a whole, enabling patent eligibility.94
Because of the challenges of patenting computer pro-
grams and the requirement of a computer to confer
technical character on mathematical models, CIIs have
seemingly emerged as a compromise. CIIs cover claims
involving ‘computers, computer networks or other pro-
grammable apparatus wherein at least one feature is
realised by means of a computer program’.95 As the
algorithms relevant to this study necessitate a computer
to be put into effect, they may either be patented as
part of the method claims of a computer program ap-
plication, or separately as CIIs.96 Computer programs
are reviewed first.
(1) Algorithms unlikely protected as part of com-
puter program
Despite the plausibility of patenting computer pro-
grams, algorithms are unlikely to obtain patent protec-
tion as part of the computer program they belong too.
In the 1998 IBM/Computer Program case, the EPO
Technical Board of Appeal (TBA) rejected a patent ap-
plication in full ‘as it was directed to a computer-
program product’.97 Even though the TBA confirmed
that computer programs are patentable if they produce
a ‘further technical effect’ that supersedes regular inter-
actions between a computer’s hardware and software,
the TBA refused to grant the patent.98 However, in
Microsoft/Clipboard Formats I, the TBA accepted a pat-
ent for a computer program facilitating data transfers
across different clipboard formats, by finding that the
program had technical character as it regarded a ‘com-
puter-readable medium’ and augmented the computer’s
internal functions.99
MEMO/02/32 20 February 2002, <http://europa.eu/rapid/press-release_
MEMO-02-32_en.htm?locale¼en> accessed 11 February 2021.
93 President’s Reference (n 91) 10.1–11.3.
94 EPO Guidelines for Examination 3.3: Mathematical Models.
95 EPO Guidelines for Examination 3.6: Programs for Computers.
96 T 424/03, (Clipboard Formats I/MICROSOFT) of 23.02.2006.
97 T 1173/97, (Computer Program I/IBM) of 1.7.1998, at 9.1.
98 T 935/97, (Computer Program II/IBM) of 4.2.1999, at 6.6.
99 T 424/03 (n 96) 5.2.
100 SV Steinbrener, ‘Patentable Subject Matter Under Article 52(2) and (3)
EPC: a White list of Positive Cases from the EPO Boards of Appeal –
Part 1’ (2018) 13 JOFIPLP 13, 13–15.
Journal of Intellectual Property Law & Practice, 2021, Vol. 16, No. 3
The TBA has handled few computer program cases,
but those decided demonstrate that the likelihood of
protecting a computer program with a patent depends
on its technical character.100 Accordingly, the type of
program and its underlying algorithms determines pat-
entability.101 The predictive algorithms and models rel-
evant to this study are built to improve the
performance of internal business operations, as well as
facilitate applications on the internet, not enhance a
computer’s inner functionality nor produce a further
technical effect between hardware and software. These
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predictive algorithms therefore fail to satisfy the techni-
cal standard envisioned by the TBA.
Decisions from the EPO Boards are not strictly bind-
ing upon EPC contracting states, and the national
courts of said states are free to interpret EPC provi-
sions, unless where it concerns the refusal or revocation
of a European patent. As most contracting states of the
EPC are TRIPS signatories, it is plausible that countries
may interpret the patentability of computer programs
divergently. The English High Court has, for instance,
accepted computer program patents.102 The Italian and
Finnish patent offices do not preclude computer pro-
gram patents for AI, albeit noting that these inventions
are generally103 and predominantly104 filed as CIIs. The
patent offices of Germany, Ireland, Spain and the Czech
Republic expressly prohibit computer program
patents.105 As such, it is unlikely that algorithms are
patented as computer programs.
(2) Algorithms as computer-implemented inventions
Algorithms are more likely to be patented as CIIs. The
European Commission confirms that CIIs are patent-
able, provided their method claims contain computer
executable steps, or perform a certain functionality
when deployed by a processor on a computer readable
medium hosting a computer program.106 The TBA has
also confirmed that including mathematical models in
patent claims does not automatically seal their patent
ineligibility.107 However, the technical character of CII
inventions receives tighter scrutiny by the TBA than
101 SV Steinbrener, ‘Patentable Subject Matter Under Article 52(2) and (3)
EPC: a Whitelist of Positive Cases from the EPO Boards of Appeal – Part
2’ (2018) 13 JOFIPLP103, 103–05.
102 Halliburton Energy Services Patent Application [2011] EWHC 2508 (Pat).
103 Correspondence withItalian Patent Office.
104 Correspondence with Finnish Patent Office.
105 Information received from national patent offices.
106 A Strowel and S Utki, ‘The Trends and Current Practises in the Area of
Patentability of Computer Implemented Inventions Within in the EU
and the US’ (2016) Final Report for The European Commission, 16.
107 T 767/99, (PITNEY BOWES/System for Processing Mail) of 13.03.2002,
at 2.4.
Katarina Foss-Solbrekk  The good, the bad and the ugly
what is for other inventions.108 Additionally, when
reviewing the invention’s inventive step, ‘only those dif-
ferences over the prior art that contribute to the techni-
cal character of the invention are to be considered’.109
In Auction Method/HITACHI, the TBA demarcated
technical considerations from ‘merely finding a com-
puter algorithm to carry out some procedure’.110
However, in 2011, the TBA reversed a rejected patent
for a data processing algorithm because it technically
and concretely solved a technical issue.111 In 2013, the
TBA stated that using a machine learning algorithm to
rank information according to user preference lacked
an inventive step and technical effects.112
In 2017, the TBA found that the cost-based algo-
rithm to optimize queries had technical character be-
cause the query was optimized in a relational database
system.113 In January 2019, the TBA upheld the refusal
of Google’s patent for a scoring algorithm as it lacked
an inventive step and technical character.114 In
February 2019, the TBA rejected a patent for a
computer-simulation based on an algorithm because of
the absence of an inventive step,115 although the TBA
referred the case to the enlarged Board of Appeal and
awaits further review.116 In October 2019, the Board of
Appeal found that an ‘execution algorithm contributes
to the overall technical purpose’ by executing the up-
date on ‘data stored and managed by the relational
database management system’ and computing the data
structures, and must be included in the inventive step
evaluation.117
It is worth noting that, in 2019, the EPO rejected
two patent applications because they named an AI ma-
chine as the inventor whereas the EPC requires a natu-
ral person,118 which most jurisdictions do.119 The US
Patent and Trademark Office also rejected a patent be-
cause a machine was listed as the inventor in April
2020.120 It is thus not possible to patent inventions
108 EPO, ‘Patents and the Fourth Industrial Revolution: The Inventions
Behind Digital Transformation’ December 2017, 21. <https://www.
lemoci.com/wp-content/uploads/2017/12/Patents-and-the-Fourth-indus
trial-Revolution-2017.pdf> accessed 11 February 2021.
109 O Baldus, ‘Wonders of Technicality: Technical Features, Technical
Problems, Functional Chains and a Review of the Comvik Approach’
(2020) 15 JIPLP 219, 219–20; T 641/00, (Two Identities/COMVIK) of
26.9.2002.
110 T 258/03, (Auction Method/HITACHI) of 21.2.2004, at 5.8.
111 T 0486/08, (Reassigning Data Objects/SAP) of 7.10.2011, at 3.5.
112 T 1510/10, (Ranking of Live Web Applications/ERICSSON) of 4.12.2013,
at 8.
113 T 1965/11 (Cost-based Materialized View Selection/MICROSOFT
TECHNOLOGY LICENSING) of 24.3.2018, at 41.
114 T 0817/16, (Document Scoring/GOOGLE) of 10.01.2019.
115 T 0489/14, (Pedestrian Simulation/CONNOR) of 22.02.2019.
116 ibid, for appeal see: <https://www.epo.org/law-practice/case-law-appeals/
pdf/t140489ex1.pdf> accessed 21 January 2021.
ARTICLE 255
where the AI system is named as the inventor. But there
is a difference in patenting the AI system itself, and AI
produced output. As this study focuses on the former,
the inventorship issue does not rule out all the algo-
rithms in question, though the type of algorithm may
play a role in whether inventorship poses a barrier.
Unsupervised algorithms wherein humans play less
of a role, as is often the case with neural networks, may,
on the one hand, be more difficult to protect as they
can evolve without continuous human input, trans-
forming it into a system not completely created by a
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natural person. This said, the human is responsible for
constructing the original network and may improve its
performance throughout and after the development
process. Without this involvement, there would be no
invention, so the inventorship criterion arguably does
not preclude neural networks from patentability. The
same applies to supervised algorithms since they require
even more human involvement. As Lauber-Rönsberg
observes, certain AI systems are only ‘a tool of a human
inventor’.121
Nevertheless, these cases demonstrate the difficulty
of obtaining patents for algorithms. Merely employing
an algorithm in a computer to complete tasks is not
technical enough. Even if the algorithm fulfils the strin-
gent technical consideration criterion, they often lack
an inventive step, and to be novel as many algorithms
are open source. Scholars such as Brkan and Bonnet ac-
cordingly conclude that algorithms are likely ineligible
for patent protection.122 But the cases above show that
it is possible, albeit difficult, to obtain patents for algo-
rithms provided they solve a technical problem in a
novel manner and with concrete effects.
Although most of these cases concern individual
algorithms, algorithmic models may fall under the
mathematical model exception of Article 52(2), making
them per se non-technical and unpatentable on their
117 T 0697/17 (SQL extensions/MICROSOFT TECHNOLOGY LICENSING)
of 17.10.2019, at 5.3.4.
118 For Grounds for the EPO Decisions of 27 January 2020 on EP18275163
and EP18275174, see: <https://register.epo.org/
application?documentId¼E4B63SD62191498&number¼EP18275163&l-
ng¼en&npl¼false> and <https://register.epo.org/
application?documentId¼E4B63OBI2076498&number¼EP18275174&l-
ng¼en&npl¼false> accessed 11 February 2021.
119 N Shemtov, ‘A Study on Inventorship in Inventions Involving AI
Activity’ EPO Commissioned Report (February 2019), 5–8.
120 See: <https://www.uspto.gov/sites/default/files/documents/16524350_
22apr2020.pdf> accessed 11 February 2021.
121 Lauber-Rönsberg and Hetmank (n 26) 571.
122 M Brkan and G Bonnet, ‘Legal and Technical Feasibility of the GDPR’s
Quest for Explanation of Algorithmic Decisions of Black Boxes, White
Boxes and Fata Morganas’ (2020) 11 EJRR 18, 43–44.
256 ARTICLE
own. If they are novel and form part of patent claims
comprising technical features which contribute to a
technical effect on the invention, such as employing
data structures for functional purposes,123 they are pat-
entable, as confirmed by the TBA.
Acquiring patents based on technical and non-
technical claims, and CIIs in general, is harder. To over-
come this difficulty, Baldus proposes that ‘a functional
chain of the identified technical problem should be set
up and used’ in the patent application because ‘by using
functional chains of technically dependent technical
features in the claim, it is possible to ensure that all the
features have to be considered technical’.124 In other
words, entangling the technical and the non-technical
features in a manner showing that both are necessary to
provide a technical solution to a technical problem.
Whether an application succeeds, however, involves
significant legal uncertainty and cost, meaning there is
little incentive to try. The technical character require-
ment remains vague, and it ultimately depends on the
type of technical problem and solution at hand. The
updated 2019 EPO Guidelines for Examination notably
state that using a neural network ‘in a heart-monitoring
apparatus for the purpose of identifying irregular heart-
beats makes a technical contribution’ whereas classify-
ing text documents based on textual content likely does
not, although ‘the steps of generating the training set
and training the classifier may contribute to the techni-
cal character’ provided they help achieve the technical
purpose.125 The tide may therefore be turning.
EPC contracting states usually follow EPO Guidelines
and TBA decisions.126 Although the WIPO127 and
EPO128 patent databases reveal that algorithmic patents
are predominantly filed in Asia and the US, several na-
tional patent offices state that they do permit CII patents
for algorithms, but that few are patented as such.129 This
is due to several reasons. The Finnish Patent and
Registration Office shares that identifying such patent
applications is challenging.130 The Croatian Patent Office
attributes the lack of information or patents to the
123 T 424/03 (n 96) 5.2.
124 Baldus (n 109) 222.
125 EPO Guidelines for Examination 3.3:1 Artificial Intelligence and
Machine Learning.
126 Correspondence with national patent offices.
127 WIPO Patentscope Database,
<https://patentscope.wipo.int/search/en/result.jsf?
currentNavigationRow¼1&prevCurrentNavigationRow¼3&office¼&
prevFilter¼&maxRec¼40562&listLengthOption¼10> accessed 11
February 2021.
128 EPO Database <https://worldwide.espacenet.com/patent/
search?q¼computer%20algorithm> accessed 11 February 2021.
129 Correspondence with national patent offices.
130 Correspondence with Finnish Patent and Registration Office.
Journal of Intellectual Property Law & Practice, 2021, Vol. 16, No. 3
emerging nature of this field, although they validated 63
European and 8 national patents for ‘computers and au-
tomated control devices’ in 2018.131 Of the European
patents validated by the Portuguese Patent Office within
this field 2 concerned ‘core AI’ and 11 ‘applied AI’.132
The opportunity to patent algorithms and algorithmic
models therefore exists, so that the lack of success may
simply be due to unfamiliarity on the part of legal
practitioners.
Moving algorithms under patent law may facilitate
some degree of transparency as patent claims are pub-
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licly available. This interpretation admittedly faces two
counterarguments. First, patents consist of esoteric
descriptions with vague ‘drawings’, rendering them in-
comprehensible to the average person.133 Secondly,
firms exclude several facets of the technology in patent
applications. Revealing extensive information would
limit firms’ ability to invoke trade secret protection.
Still, the public factor of patent applications subjects
them to public scrutiny. More importantly, it may mo-
tivate actors to share aspects of their technology with-
out fear of losing their IPRs. If they refused,
compulsory licensing would also be an option, as per-
mitted throughout the EU.134 Section 24(4) of the
German Patent Act notably allows for ‘compulsory
cross-licensing’ which could be used for algorithmic in-
sight in general, and to access to ‘fundamental algo-
rithms’ to encourage improvement patents building on
the original idea.135 But with uncertainties present un-
der patent and copyright law, and the commercial value
of algorithms, actors resort to trade secrets.
C. Algorithms and data protected as trade
secrets
Trade secrets are the only option left for firms wishing
to protect their algorithms. Some even believe this is
the best course of action: as Nirwani writes, in today’s
‘increasingly complex, highly competitive, hyper-
connected world, some things that might ordinarily be
protected by traditional IPRs . . . are best kept secret’.136
131 Correspondence with Croatian Patent Office.
132 Correspondence with Portuguese Patent Office.
133 Gervais (n 70) 34.
134 See: EPO, ‘Compulsory Licensing in Europe’ (2018), <http://documents.
epo.org/projects/babylon/eponot.nsf/0/
8509F913B768D063C1258382004FC677/$File/compulsory_licensing_in_
europe_en.pdf> accessed 11 February 2021.
135 EPO, ‘Patenting Artificial Intelligence’ Conference Summary (May 2018),
3 <https://e-courses.epo.org/pluginfile.php/23523/mod_resource/con
tent/2/Summary%20Artificial%20Intelligence%20Conference.pdf>
accessed 11 February 2021.
136 P Nirwan, ‘Trade Secrets: the Hidden IP Right’ WIPO Magazine
December 2017 <https://www.wipo.int/wipo_magazine/en/2017/06/arti
cle_0006.html> accessed 11 February 2021.
Katarina Foss-Solbrekk  The good, the bad and the ugly
Indeed, this helps avoid the risk of costly information
breaches, yet it deviates from the original purpose of
trade secrecy laws. They emerged to safeguard intangi-
ble assets, such as confidential commercial information
giving a competitive advantage,137 from business com-
petitors and against breaches of confidence, whistle-
blowing, theft and misappropriation.138As Lemley
finds, the earliest cases concerning trade secrets in
England and the US concerned the circumstances ‘in
which an employee may continue her business after
departing her employer’ or ‘a competitor may copy
another’s publicly sold product’ and ‘whether courts
will enforce a contract requiring that business informa-
tion be kept confidential’.139 Trade secrets are not
intended to be used as an instrument to protect IP—
nor are they always considered to be an IP right, as is
discussed in greater detail below—technological systems
or inhibit informational access in civil and criminal
cases and, by extension, accountability therein. This is
evident in the statutory instruments overseeing their
protection.
Article 39 of TRIPS obliges signatories to ensure that
natural and legal persons may protect ‘undisclosed in-
formation’ from being shared, acquired or used without
their consent on three conditions. First, that the infor-
mation is secret, meaning it remains ‘generally’ un-
known to people commonly working with such
information. Secondly, that its commercial value stems
from its secrecy. Thirdly, that the person managing said
information has taken reasonable steps to protect its se-
crecy.140 The EU only recently harmonized trade secrets
protection through the EUTSD in 2016. The EUTSD
incorporated Article 39 of TRIPS, with Article 2 repeat-
ing Article 39 verbatim. Though TRIPS does not define
trade secrets, Recital 1, 2 and Recital 14 of the EUTSD
elucidate that they cover know-how, as well as business
and technological information, in addition to commer-
cial data on customers.
Given algorithms’ general anonymity and commer-
cial value, they are eligible for trade secret protection.141
Google, Facebook and Yahoo!’s algorithms are, for
137 EUTSD, Recital 1; For history of trade secrets law, see: Bently (n 8) and
M Risch, ‘Why Do We Have Trade Secrets?’ (2007) 11 Marquette
Intellectual Property Law Review 1.
138 Maggiolini (n 6) 1–16; Bently (n 8) 63.
139 M Lemley, ‘The Surprising Virtues of Treating Trade Secrets as IP Rights’
(2008) 61 Stanford Law Review 311, 315.
140 TRIPS, art 39.
141 GNL Diega, ‘Against the Dehumanisation of Decision-Making’ (2018) 9
JIPITEC 3, 4–12.
142 ibid.
143 EUTSD, Recital 2; G Malgieri, ‘Trade Secrets v Personal Data: a Possible
Solution for Balancing Rights’ (2016) 6 IDPL 102, 102–04.
144 art 1(1).
ARTICLE 257
example, trade secrets.142 As trade secrets encompass all
types of information, the training data and other pro-
prietary information relating to the algorithm falls
within its ambit. Individuals’ personal data may be also
included.143 Although the EUTSD allows States to
adopt national provisions surpassing those in the
Directive,144 trade secrets generally safeguard informa-
tion from unfair competition and commercial use, but
do not, as elucidated under Recital 16 of the EUTSD,
‘create any exclusive rights to know-how or
information’.
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Trade secrets shield against unlawful acquisitions,
uses or disclosures only. Situations where each of these
actions turn lawful are recognized in the EUTSD.
Disclosures on public interest grounds or for the per-
formance of administrative and judicial duties are, for
instance, permitted.145 However, despite incorporating
a public interest exception, the EUTSD contains no
public interest remedy, such as compulsory licensing,
meaning that trade secrets must either be circumvented
or disclosed to pave the way for algorithmic transpar-
ency. This is problematic when trade secrets constitute
one reason for why AI systems are opaque.
The algorithm is not shielded from the public for
convenience. It is hidden to preserve trade secret status
as this only remains intact for as long as the informa-
tion remains confidential, meaning actors must take
steps to ensure confidentiality and that there is little in-
centive nor reason for firms to reveal algorithmic infor-
mation. This stalemate is caused by the fact that AI
systems are IP yet fail to qualify for patent or copyright
protection, whereas trade secrets do not award exclusive
IPRs,146 or property rights per se.147
The EUTSD bifurcates trade secrets from other
IPRs,148 such as copyright and patents, which are
treated as property in the EU.149 Indeed, as Schovsbo
and Riis state, ‘as for the EU, the Directive on
trade secrets .. does not regard trade secrets as an
IPR’.150 The European Commission’s EUTSD Impact
Assessment confirms that, ‘trade secrets are not
IPRs’.151 Other than Sweden, which has sui generis trade
145 art 1(2).
146 EUTSD, Recital 16; R Niebel, L Martinis and B Clark, ‘The EU Trade
Secrets Directive: All Change for Trade Secret Protection in Europe’
(2018) 13 JIPLP 447.
147 T Aplin, ‘A Critical Evaluation of the Proposed Evaluation of the
Proposed EU Trade Secrets Directive’ King’s College London Dickson
Poon School of Law Legal Studies Research Paper Series, Paper No. 2014-
25, 8; Bently (n 8) 81.
148 Recital 1.
149 Aplin (n 7) 421–30.
150 Schovsbo and Riis (n 7) 401.
151 European Commission Staff Working Document Impact Assessment
SWD(2013) 471 Final 28 November, at 267.
258 ARTICLE
secrets legislation,152 though this does not necessarily
give rise to property rights,153 EU states do not classify
trade secrets as property or IP.154
AI systems are clearly IP, and should be protected as
such. They should not fall under the auspices of trade se-
crecy laws which are clearly not designed to protect AI, or
any type of property or IP. Nor are trade secrets consid-
ered IP by most EU Member States and, as above, AI sys-
tems are IP. Failing to recognize this is counterproductive
for both business and societal interests. It means weaker
ownership rights for persons protecting their AI systems as
trade secrets,155 and it means less algorithmic transparency
overall as trade secrets are unregistered rights and any in-
formation pertaining to the algorithm itself, how it works
or the personal data its results are based on may be with-
held on trade secret grounds. Trade secret law, therefore,
obfuscates access to the algorithm and to explanations be-
hind automated decisions, dimming the transparency of
the entire system. Equally, as trade secrets are unlimited in
nature, lasting for as long as the information is secret, it
means that AI systems may remain opaque indefinitely. It
is thus in the interest of both business and society to move
AI systems to a different IP framework.
IV. Conclusion
This article has demonstrated the need for an urgent re-
evaluation of how AI systems and algorithms should be
protected under IP law, in a manner conducive to busi-
ness success and society’s best interests. Even though
the current reliance on trade secret laws is commercially
understandable given the uncertainty under copyright
and patent laws, the normal commercial reasons for IP
protection must be balanced against the rights of indi-
viduals and society.
With individuals unable to access details of wide-
spread and vital decision-making processes that impact
their lives, balance is not intact. Nor is the reliance on
trade secrets justified in terms of the aims that IPRs
aim to foster. Moving AI systems and algorithms under
patent or copyright law is therefore not only essential
for society, but also to the integrity of the IP system at
large. IP law needs a paradigm shift to recognize AI as
creative or technical art so that it either becomes eligi-
ble for copyright or patent protection.
As AI systems and their algorithms are seemingly too
technical for copyright, but ironically not always techni-
cal enough for patent protection, we are currently
152 Swedish Act on the Protection of Trade Secrets 1990:409, art 1.
153 Aplin (n 7) 422.
154 O-A Rognstand, Property Aspects of Intellectual Property (CUP 2018) 8.
155 Maggiolini (n 6) 1–16.
Journal of Intellectual Property Law & Practice, 2021, Vol. 16, No. 3
deadlocked. But neither option is impossible. Copyright
seems improbable, however, with the CJEU predomi-
nantly interpreting (and valuing) creativity in terms of
traditional, albeit outdated, values of ‘artistry’.
Protecting algorithms and AI systems under patent
law as CIIs is more feasible, as cases from the TBA dem-
onstrate. The new EPO Guidelines for Examination even
confirm that machine learning algorithms such as neural
networks serving a technical purpose are patentable.156
Legal uncertainties over how and when algorithms over-
come the technical character requirement nonetheless
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subsists, offering little incentive for rightholders to try
the patent law route when trade secrecy privileges are
more convenient. IP rightholders and their lawyers,
therefore, need to see patentability of AI systems and
algorithms as a real possibility, not an anomaly.
Moving algorithms under the auspices of patent law
not only helps circumvent the barriers to algorithmic
transparency via public patent applications and com-
pulsory licensing options, but also reflects the true value
of the invention itself, as technical and novel, rather
than simply masking the system behind corporate con-
fidentiality rules. The attractiveness of using other IPRs
to resolve the transparency issues of AI caused even the
EPO to concede that,
From the perspective of innovation for the benefit of soci-
ety, there should be as much incentive as possible for inno-
vators to disclose AI innovations – such as the algorithms
and how they were trained – and not to choose the option
of trade secrets.157
In short, the IP sector should accept that the current use
of trade secrecy law to protect companies’ AI work is a
‘bad’ solution, creating a dangerous lack of transparency
and accountability. Copyright protection would offer a
better but ‘ugly’ solution, allowing for systems to be
studied and subject to compulsory licenses if need be,
but it would squeeze technical systems under a frame-
work designed for ‘creative’ works. The best answer is to
broaden the scope of patent protection to incorporate
algorithms, algorithmic models and their bespoke data-
sets: this would help with the transparency of systems by,
not only making aspects of their functionality public,
and not hidden, but also by granting greater insight into
which systems actually exist. In the current battle of our
‘good, bad and ugly’ triumvirate of methods to accord
IPRs to AI, it is patents that are the only ‘good’ solution
and should be embraced as such.
156 EPO Guidelines for Examination 3.3:1 Artificial Intelligence and
Machine Learning.
157 EPO (n 135) 3.