Interface Between FRAND Licensing of Standard Essential Patents (SEPS) and Competition Law: Issues and Challenges

Abstract

Standards play a very important role in our day-to-day lives. Technically, standards are technical specifications that seek to provide a common design for a product or process. Globalisation and the increase in economic transactions between different countries have made it imperative to develop certain international standards for technology manufactured by industries. Patents and standards sever the same purpose, and that is fostering innovation in technology. However, the implementation of these standards through the licensing system must be such that it mutually benefits the patent holder as well as the company that uses the patent and the royalties must be paid on fair and reasonable terms. There is no legislative definition that exists for SEPs and there have been a significant rise in litigation involving SEPs in India, with most of the disputes pertaining to granting of injunction as a result of their infringement. The present article highlights the conflict of availability of SEPs on FRAND terms without affecting the Competition law and also presents solutions and suggestions for enhanced transparency and accessibility to patented technology that cover standards and the proper functioning of the licensing system on fair and reasonable terms. Thus, the researcher in the present article highlights the following: (a) The various problems that exist in licensing of Standard Essential Patents over Fair, Reasonable and Non-Discriminatory terms (b) The need and method of regulating the obligations of Standard Essential Patent holders and their licenses in return of reasonable royalties (c) The position in various jurisdictions and drawing a comparison with suggestions for solving problems like patent holdups, patent pools, patent stocking, etc. (d) The judicial approach with respect to SEPs and obligations of SEP holders.