EU Competition Commissioner sets sights on patent misuse
Speaking in Paris earlier this year, Joaquin Almunia, EC’s competition policy chief, signalled a warning to companies that have “essential” patents for standards in particular fields that they are obliged to license them on “fair, reasonable and non-discriminatory [FRAND] terms.”
Almunia stated that once adopted, a standard becomes the norm and the underlying patents are indispensable. As such, the owners of these essential patents should be not allowed to misuse their market power.
These comments are of particular interest in light of the licensing disputes between Apple, Motorola and Samsung. In January this year, the EC opened an investigation into Samsung’s use of standard-essential 3G patents in lawsuits, famously against Apple in Europe.
An exploitation of essential patents may constitute an abuse of dominant position. Large technology companies are not the only industry under the EC microscope – Almunia also noted concern about using patents to limit the growth of competitors in the pharmaceutical sector, in the use of patents by originators to delay the entry of generic drugs.
The EC can impose fines up to 10% of the company’s global turnover, and in the past it has flexed its regulatory arm when finishing Microsoft and Intel.