Following the conclusion of the Aristocrat saga1 and a public consultation process, the Australian Patent Office has made further updates to the Patent Manual of Practice and Procedure (the manual) concerning the subject matter eligibility of Computer Implemented Inventions (CIIs).
The latest update materially refines what was an already significant update earlier this year and demonstrates the Australian Patent Office’s willingness to engage with stakeholders.
For applicants seeking to protect CIIs, the latest update to the manual is generally favourable. This is particularly the case for inventions that produce external technical effects or involve substantive interactions with physical hardware beyond mere implementation on a standard computer.
For pure software inventions operating within a conventional computing environment, the latest update should support eligibility for a broader range of improvements. This contrasts with the previous approach under which the only way to establish patentability of such inventions was typically to establish an improvement to computer technology itself.
It will be interesting to see how the assessment of CIIs, and the manual, evolves as Patent Office hearings and further court decisions issue.
Background
The Australian Patent Office initially updated the manual in March 2026, following the High Court’s refusal of special leave to appeal Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2025] FCAFC 131 (Aristocrat 25).
Our comments on the initial update are here. For more detailed background on the Aristocrat 25 decision, and the request for special leave to appeal, see here, here and here.
Given the acknowledged importance of the issue, the Australian Patent Office undertook a public consultation process on the initial update. The published submissions (including by FPA Patent Attorneys) and the Australian Patent Office’s response to the consultation can be found here.
In their response, the Australian Patent Office considered “that the key criticism in Aristocrat 25 is that one must avoid taking ‘too rigid and narrow an approach’.”2
What does the manual now say?
In the latest update of the manual, the fundamental considerations introduced in March remain, but several aspects have been clarified or broadened following the consultation and stakeholder feedback.
Overall, the latest update appears more favourable for CIIs than previous versions, although perhaps not as permissive or as clear as some stakeholders had hoped.
The most relevant sections to assessing patentable subject matter of CIIs are:
One notable change is the removal of references to identifying the “substance of the invention” in the sense of identifying the invention’s contribution to the art. Instead, the latest update refers to the need to “characterise the invention as a matter of substance” (as opposed to a matter of form), “to ensure examiners avoid identifying subsets of claimed features in the characterisation exercise”.3
The latest update continues to adopt the formulation from Aristocrat 25, that a CII needs to be assessed as a matter of substance, once it has been “properly characterised”, so as to determine whether it involves:
(i) an abstract idea which is manipulated on a computer – which is unpatentable; or
(ii) an abstract idea which is implemented on a computer to produce an artificial state of affairs and a useful result – which is patentable.
However, the latest update removed previous reference to any requirement for a “relevant artificial effect” and removed the requirement that “something more is required”. The Australian Patent Office nevertheless maintains that “requiring more than mere computer implementation is fundamental to assessing the patentability of computer implemented inventions.”4
With the latest update, the manual seeks to align Aristocrat 25 with earlier authorities by focusing on properly characterising the invention under a decision-making framework, with additional factors to consider for some claims, when differentiating between the categories (i) and (ii).
The decision-making framework
The latest update confirms the assessment is not one of novelty or inventiveness. It nonetheless uses the term “new” when characterising claims to distinguish from common general knowledge (CGK) computer products and systems. In this context, “new” is used as part of the characterisation exercise, rather than as a separate novelty test. For claims with such “new” physical features, the framework provides “a preliminary pathway to more readily support patentability.”5
In broad terms, the framework identifies three categories for assessing the patentable subject matter of claims for CIIs:
- Where the physical features of the claim describe a new (not CGK) physical product or system, the invention may be characterised as involving patentable subject matter without needing to proceed to additional factors.
- Where the claim is directed to software alone, additional factors will need to be considered.
- Where the physical features of the claim are standard features of a known (CGK) computer or computerised product/system, additional factors will need to be considered.
The additional factors to consider
Where a claim is directed to software alone or to a known computer system the manual requires additional factors to be considered.
In applying these additional factors, characterising the invention as claimed involves considering all of the claim integers and how they interoperate: no integers can be disregarded.
The additional factors are provided as a non-exhaustive list. Each, if applicable, would generally indicate that a claimed invention is patentable but none of the factors is, in and of itself, a requirement that must be satisfied.
In overview, the additional factors are:
- Does the computerised product or system work in an altered or improved manner, noting that an invention is not patentable merely because a computer is programmed with a new method?
- Is a relevant technical effect occurring external to the computerised product or system, or is a technical problem being solved outside the computerised product or system?
- Is a technical problem solved with a computerised product or system?
The factors are discussed by reference to decided cases, and whether any factor is satisfied will turn on the particular invention as a matter of substance. The factors are not mutually exclusive, and the latest update indicates that some inventions may satisfy multiple factors.
Treatment of earlier court decisions rejecting CIIs
The Aristocrat 25 decision states that a number of earlier court decisions in which certain CII claims were rejected were correct. The Aristocrat 25 decision also cautions, however, that those earlier decisions must be read in the context of what was being decided.
The parts of the manual referring to the earlier CII decisions have now been amended to “ensure that examiners apply caution to the reasoning expressed in each of the earlier Full Court decisions, and to retain focus on the formulation advanced by Aristocrat 25.”6
Common across all the rejected cases, the latest update indicates:
- in substance the claimed invention involved an unpatentable business method; and
- there were no factors supporting the existence of patentable subject matter.
Key takeaways
The latest update is a positive development for applicants pursuing protection for CIIs in Australia.
In particular:
- The latest update places greater emphasis on characterising the invention as a whole.
- The additional factors are indicators supporting patentability, rather than minimum requirements that must be satisfied.
- Improvements to computer technology are not the only pathway to patentability.
- An invention may provide a patentable system that operates in an altered or improved manner, with or without solving a technical problem.
- Inventions involving substantive interactions with physical components are viewed favourably.
- Direct external technical effects are also favourable indicators of patentability. However, where an external effect is merely the indirect result of an underlying unpatentable method, irrespective of computerisation, the external effect may not carry significant weight.
- Previous CIIs rejected by the courts involved otherwise unpatentable business methods with no factors supporting patentable subject matter.
Overall, the latest update is an encouraging development that should improve the prospects of securing protection for a wider range of CIIs. In particular, where an invention does not, in substance, reduce to an otherwise unpatentable business method or scheme, the latest update provides greater flexibility for applicants to establish patentable subject matter.
That said, some uncertainties remain. Much will turn on how an invention is characterised, and the flexibility in the framework leaves room to reach familiar unfavourable conclusions, regarding mere computer implemented schemes, albeit by different reasoning.
Whether examination practice draws on the flexibility available in the latest update, or continues to reflect the narrower reasoning of earlier decisions, remains to be seen. The practical impact will become clearer as examination practice settles and further Patent Office hearing and court decisions emerge.
FPA Patent Attorneys has a dedicated team with expertise in protecting computing, software and artificial intelligence inventions. Please reach out if you are interested in protecting your innovations in this space.
1 Litigation between Aristocrat Technologies Australia Pty Ltd and the Commissioner of Patents concerning the subject matter eligibility of an electronic gaming machine configured to play a feature game.
2 IP Australia, Response to Public Consultation – Computer Implemented Inventions: IP Australia Patent Manual of Practice and Procedure Update – July 2026 (3 July 2026).
3 Ibid.
4 Ibid.
5 Ibid.
6 Ibid.
