South Africa: Nedbank And IT Entrepreneurs In Developing Patent Saga

Last Updated: 23 July 2019
Article by Pieter Lombard

It has recently been reported that two IT entrepreneurs from Gugulethu have made an application for an interdict to prevent Nedbank from using, that is, infringing, their invention protected by South African patent number 2016/05259 entitled "Method of and system for activating or deactivating a financial transaction card" ("the Patent"). Various questions have been raised by the public regarding the validity of the Patent, such as, what protection the Patent affords the entrepreneurs and what the entrepreneurs would have to prove to show that Nedbank is indeed infringing the Patent and so forth. Knowing how fiery we South Africans can become when discussing such emotive topics around a braai or on social media, it is prudent to provide an overview of the law of patents as it pertains to the matter and based on publicly available information. Please note that this article speaks to an action for the infringement of a patent which is to follow the application for an interdict and not to the application for an interdict itself.

Do software inventions qualify for patent protection?

The South African Patents Act ("the Act") provides that a patent may be granted for any new invention which involves an inventive step and which is capable of being used or applied in trade, industry or agriculture.

The Act does not provide a definition of "invention" and rather provides a list of subject matter which does not qualify as an "invention" for the purposes of the Act. Here, among other things, the Act provides that a computer program shall not qualify as an "invention" for the purposes of the Act. Importantly, however, the Act provides that only a computer program as such is not patentable.

Therefore, a method or system that utilises a computer program to provide a certain result may be patentable. Naturally the method or system would have to be new, involve an inventive step and be capable of being used in trade, industry or agriculture to qualify for patent protection.

What protection does the Patent afford the Gugulethu IT entrepreneurs?

A patent grants the patentee the right to exclude others from making, using, exercising, disposing of, offering to dispose of and importing the invention claimed in the relevant patent.

The Patent was granted and became open to public inspection on 30 August 2017 and a copy of this can be found online on the Companies and Intellectual Property Commission's website. Whilst reading the Patent it is important to note that the protection afforded is delineated by its claims. In particular, the so-called independent claims of the Patent define the broadest scope of protection afforded by the Patent. The Patent has two independent claims, one directed towards a method and the other to a system.

As an illustration, the first independent claim of the Patent, claim 1, reads as follow:

A method of activating or deactivating a financial transaction card, and at least one account associated with the card, the method comprising:

  • receiving a request from a user or otherwise determining a need to activating or deactivating a card;
  • prompting the user to insert the user's full name in a text field;
  • prompting the user to insert at least a portion of an identification number associated with the user;
  • prompting the user to insert a PIN number associated with the bank card, which is to be activated or deactivated;
  • prompting the user to select the account linked to the card, which is to be activated or deactivated;
  • comparing the provided information to information stored on a database; and
  • if the provided information is correct, or at least substantially correct, approving the request to activate or deactivate the relevant account/s and/or card.

What do the Gugulethu IT entrepreneurs have to prove to show that Nedbank is indeed infringing their Patent?

The onus rests on the Gugulethu IT entrepreneurs to establish a chain of evidence demonstrating that one or more of the acts of infringement as defined in the Act has, on a balance of probabilities, been perpetrated by Nedbank.

During any infringement proceedings, the court would have to ask itself "what would a person skilled in the art [technology to which the invention relates], on an integer-by-integer and purposive analysis of the claim, understand the forbidden field to be?1

Therefore, Nedbank would only be infringing claim 1 of the Patent if its method of blocking a financial transaction card includes all of the essential integers of claim 1. Importantly, infringement will still be found if Nedbank's alleged infringing method includes all of the essential integers of claim 1 of the Patent, notwithstanding that the alleged infringing method includes additional essential integers.

What defences does an allegedly infringing party have against an infringement action?

One possible defence which an allegedly infringing party may have against an action for the infringement of a patent is that their product/method simply does not fall within the scope of protection of one of the claims of the alleged infringed patent. As mentioned earlier, the claim of a patent would only be infringed if the product/method includes all the essential integers (i.e. characteristics) of said claim.

Any party being accused of patent infringement or otherwise may also elect to file a counterclaim against the infringement action for the revocation of the patent in question, based on any one or more of the grounds for revocation cited in the Act. Currently, the South African Patent Office does not subject an application for a patent to substantive examination; i.e. the novel and inventive merit of the invention is not assessed before the grant of a patent application. Therefore, if the allegedly infringing party can prove that the invention claimed in the relevant patent was not new and/or did not involve an inventive step at the date when the patent was filed, the patent will be liable to revocation. If a patent is revoked, the effect is as if the patent never existed, and the proprietors of same would no longer enjoy any exclusionary patent protection under the patent.


The application for an interdict to prevent Nedbank from using, that is, infringing, the Gugulethu IT entrepreneurs' patented invention is no doubt only the start of a developing saga. Young entrepreneurs in particular are encouraged to follow this case earnestly to acquaint themselves with the law of patents and to thereby equip themselves with the knowledge on how to protect their own inventions.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Practice Guides
by Mondaq Advice Centres
Relevancy Powered by MondaqAI
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions