EU – Commission to set out EU approach to SEPs

Posted: December 8th, 2017

Communication from the Commission to the Institutions on Setting out the EU approach to Standard Essential Patents

“In view of current developments, the Commission considers that SEP licencing should be based on the basis of the following principles:

– There is no one-size-fit-all solution on what FRAND is: what can be considered fair and reasonable can differ from sector to sector and over time. Efficiency considerations, reasonable licence fee expectations on both sides, the facilitation of the uptake by implementers to promote wide diffusion of the standard should be taken into account.

– Determining a FRAND value should require taking into account the present value added of the patented technology. That value should be irrespective of the market success of the product which is unrelated to the value of the patented technology.

– In defining a FRAND value, parties need to take account of a reasonable aggregate rate for the standard.

– The non-discrimination element of FRAND indicates that rightholders cannot discriminate between implementers that are ‘similarly situated’.

– For products with a global circulation, SEP licences granted on a worldwide basis may contribute to a more efficient approach and therefore can be compatible with FRAND.

The Commission calls on SDOs and SEP holders to develop effective solutions to facilitate the licensing of a large number of implementers in the IoT environment (especially SMEs), via patent pools or other licensing platforms, while offering sufficient transparency and predictability.

The Commission will monitor licencing practices, in particular in the IoT sector. It will also set up an expert group with the view to deepening expertise on industry licensing practices, sound IP valuation and FRAND determination.”

The entire communication can be read here.

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