Greed unlimited: patenting tax evasion, crime and the law.

The European Parliament has proposed new legislation that permits patenting of, among other things, computer algorithms. Business procedures are one of the other things to be patented. See The Freepatents server for more details. Some law firms are secretly planning to exploit such legislation in unprecedented ways. The following article is based on some rumours and illustrates what could currently be in the works. No hard evidence can be presented here, because the people involved are too well aware of their nondisclosure agreements.

The law firm Greed Unlimited (in the Dutch town of Leersum) specializes in legal advice for rich people who want to avoid wasting money on taxes. Those people waste money on lawyers instead, but wait, if you are rich enough, the benefits far outweigh the cost. Since there are so many rich people in The Netherlands, Greed Unlimited is doing fairly well. There is only one problem with tax evasion: the tricks cannot be patented. So those rich people meet each other on parties, they talk (as long as the music permits) and they hear about each other's tax constructs. So people start to exploit loopholes in the tax laws without ever paying money to Greed unlimited and that is not good!. What's worse, far too many people steal the same tricks, legislators get nervous and they plug the loopholes in the laws. At that time, Greed Unlimited can no longer sell the same trick and they have to innovate. Innovation costs money and you have to do it very sparingly.

This is where the new patent law comes in handy. If one finds a loophole in the tax laws and invents a procedure to exploit it, this procedure is a business practice and this will be patentable subject matter. Once Greed Unlimited holds a patent on the procedure, every user of the procedure has to obtain a license. The license fee can be a one-time fee or a fraction of the saved tax money. In any case Greed Unlimited collects money from every user of the technology. What's more: Greed Unlimited can limit the number of licensees, so this particular loophole does not become a problem for the government and there is less chance that the laws will be fixed.

This is however just the beginning of the story. There will be a whole lot of new terrain that was previously uncovered by intellectual property laws. In the previous paragraph we talked about patents on specific tax evasion procedures, but the whole concept of patenting tax evasion can be patented as well. Alas the concept of tax evasion is not patentable due to prior art. Therefore Greed Unlimited will be the only company who can patent tax evasion procedures or they can collect royalties from their competitors. Patenting of concepts related to patenting is called meta-patenting and Greed Unlimited is sure to file some very fundamental key patents in this area, once the opportunity is created. Dissemination of this paper will doubtlessly spoil some of the plans of Greed Unlimited in this area.

So for the moment, let's assume that meta-patenting in general and the application of meta-patenting to tax evasion procedures can no longer be patented. This does not mean that meta-patenting is dead. A lot of procedures surrounding patenting of tax evasion constructs, can still be patented. All kinds of procedures, related to careful timing, prevention of a loophole being fixed and gain maximization can and will be patented.

Greed Unlimited thrives on loopholes in tax laws. For every loophole there is a procedure to exploit it (which can be patented) and a change in the law that will fix it. If the change in the law is non-obvious (and it usually is), it can be patented as well. Thus we can prevent the government from changing the law for at least 20 years. This means 20 more years of successful commercial exploitation of the intellectual property surrounding this loophole.

It's not only changes in tax laws that can be patented. Just about every law (if it is novel) can be patented. Think about the market potential! Good laws (that everybody wants) are a source of license fees and royalties, bad laws (that you don't want) can be blocked for 20 years. Greed Unlimited will lobby for patented regulations to be adopted by the European Commision. Every member country has to adopt these rules in its national laws and has to negotiate a license with Greed Unlimited.

It is not illegal to invent new ways to commit crimes. If this were true, all authors of detective novels would be in jail. But apart from writing books, you can do very little with you invention, at least not legally. This will change, because you will be able to patent the invention. If somebody (a criminal) uses your invention, you can sue him for patent infringement. Of course the police try to arrest the criminals, the Justice department will prosecute them, the judge will convict them, but additionally Greed Unlimited can sue them for patent infringement. Greed Unlimited has much expertise in the area of tax fraud. Knowing the loopholes not only means that you know what is allowed, but also what is not allowed.

As we see, tax evasion procedures, laws and criminal acts can all be considered business procedures and with the proposed patent legislation they can be patented. And we have only scratched the surface. There will be a lot of opportunity for creativity in this area (albeit in a sickening way). New rules will make the game more exciting and much more lucrative for some.