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12 September 2018PatentsAdrian Howes

Wanted: experts on SEP licensing and FRAND

The European Commission is setting up a group of experts on the licensing and valuation of standard essential patents (SEPs). The group’s success will depend heavily on its members and the opinions and recommendations it can formulate.

Last November, the Commission’s Communication on “Setting out the EU approach to Standard Essential Patents” covered several SEP-related issues, including principles for licensing SEPs on fair, reasonable and non-discriminatory (FRAND) terms.

Over the last few years there has been debate at industry and policy level about these issues. More recently, some principles have evolved from court decisions around the world, often based on good industry practices. The Communication largely adopted many of these, and set out some action points.

The Communication recognised that the world is changing. The “fourth industrial revolution”, or the Internet of Things (IoT), may complicate the licensing of SEPs. Reasons for this include the increasing development of new technical standards and IP-protected technologies incorporated by them, as well as the use by new industries of standardised communication technologies. These new entrants may be unfamiliar with SEP licensing practices but will require licences to relevant SEPs.

Establishing the group

The Commission wisely recognised that there is “no one-size-fits-all solution on what FRAND is: what can be considered fair and reasonable can differ from sector to sector and over time”, and noted the importance of commercially negotiated outcomes.

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