Aristocrat 2026: The dust finally settles

The landscape and outlook for software patents in Australia should, on paper, be more favourable to applicants than at any time in the last 10–15 years. Allowance rates for computer-related inventions can be expected to converge somewhere near that of the United States. Over the last decade, research indicates an allowance rate in Australia about half-way between the United States and Europe for computer-implemented patent applications. The situation is not as simple as it may appear, however, as the examination manual (Patent Manual of Practice and Procedure) while updated arguably still leans towards now outdated reasoning that is less supportive of applicants. And examination practice seems slow to adopt the full implications of this landmark decision. So change may be more gradual than expected.

Aristocrat is the most consequential development in Australian patent law in a generation. And it has now landed at its conclusion. Aristocrat is likely to stand for some time as it is an authorative ruling, but what seems far less settled is the understanding of it implications for Australian patent law, in particular as it relates to the administration of computer-implemented inventions. There is not as yet a universal understanding of how Aristocrat should in fact be applied in practice during examination.

Aristocrat as referred to here is actually a trio of interrelated decisions dealing with the same matter. The conclusion coincides with the High Court of Australia issuingits decision refusing to hear an appeal from the Full Court of the Federal Court of Australia. Three inter-related decisions, the Aristocrat triliogy, have dismantled the analytical framework that governed computer-implemented inventions in Australia for over a decade now.

The Aristocrat trilogy in full comprises three successive cases: Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2022] HCA 29, Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2025] FCAFC 131, and Commissioner of Patents v Aristocrat Technologies Australia Pty Ltd [2026] HCADisp 15.

Synopsis of the trilogy

The High Court of Australia in 2022 split 3:3 on whether Aristocrat's electronic gaming machine patents claimed patentable subject matter. The "allowing reasons" of Gordon, Edelman and Steward JJ would have allowed the appeal, rejecting the Full Court's two-step test for computer-implemented inventions and returning the analysis to NRDC, the foundational authority dating back to 1959 on patent eligibility, termed manner of manufacture in the Australian legislation. Because of the 3:3 split, the earlier Full Court decision was affirmed by operation of s 23(2)(a) of the Judiciary Act, leaving the allowing reasons without formal ratio.

In 2025, a differently constituted Full Court (Beach, Rofe and Jackman JJ) unanimously allowed the appeal in favour of the patent applicant, Aristocrat. The Court made the formal finding that there was a "compelling reason" to depart from the earlier Full Court. The compelling reason being that all six High Court Justices had criticised its two-step test. The Full Court adopted the rationale of the allowing reasons: characterise the claim properly, then ask the single NRDC question.

In February 2026, a seven-Justice High Court bench refused the Commissioner special leave to appeal. The Disposition is brief but precise. Two phrases matter: the Full Court "applied established principles concerning the assessment of manner of manufacture" and reached "a unanimous and clear conclusion as to characterisation." This thoroughly endorsed the Full Court, which followed the High Court's allowing reasons. This was accordingly not any groundbreaking new law, but a return to longstanding established principles, and correcting the errors of the last decade that had aggregated across many decisions in the Full Court of the Federal Court of Australia over more than a decade.

Confusion remains in examination practice for now

As of June 2026, the Patent Office has released two versions of revised examination guidelines for computer-implemented inventions. The second version of revisions is out for consultation at present, with many submissions received. Criticism centres around a substantial overhang of principles and analysis in the PMPP that ultimately derive from decisions discredited by the Aristocrat trilogy. The expectation is that revised examination guidelines are issued in the coming months that align with the Aristocrat trilogy, and applicants start seeing greater consistency and more favourable treatment on patent eligibility in day-to-day Australian patent examination practice as the relevant art groups become more familiar with the new guidelines. While the examination guidelines are not the law, the examination guidelines do assume disproportionate weight with examiners.

The myth of the two-limb formulation

Many patent practitioners have also got the impression that the Aristocrat trilogy installs a new test for patent eligibility, namely the so-called two-limb formulation. The two-limb formulation establishes a branched distinction between: (i) an abstract idea which is manipulated on a computer; or (ii) an abstract idea which is implemented on a computer to achieve a artificial state of affairs and a useful result. This appears at [122] of the allowing reasons, in a paragraph whose purpose is to re-explain five decided cases, namely Grant, Research Affiliates, RPL Central, Encompass, Rokt whose outcomes were correct but whose reasoning had been framed around the now-discredited expression "improvement in computer technology". Is this the test? Emphatically no, it's not even referring to the Aristocrat case at hand. How so? It's attempting to interpret some earlier cases the decision explicitly rejects as to their reasoning, as footnoted in the decision. Essentially, there's no legal weight in the two-limb formulation. The law of the land is 'established principles'.