METI’s ‘Good Faith Negotiation Guidelines for Standard Essential Patent Licenses’
Good Faith Negotiation Guidelines for Standard Essential Patent Licenses (the Guidelines)
Japan’s Ministry of Economy, Trade and Industry (METI) established the “Good Faith Negotiation Guidelines for Standard Essential Patent Licenses” (the guidelines) on March 31, 2022. The guidelines are the norms of good faith negotiations provided by the Japanese government to be followed by SEP holders and implementers involved in SEP licensing negotiations, including for Japanese patents. The guidelines contain the following:
Standing of the Guidelines in SEP Licensing Negotiations
The guidelines are the norms of good faith negotiations provided by the Japanese government to be followed by SEP holders and implementers involved in SEP licensing negotiations, including for Japanese patents, to realise an appropriate licensing environment through improvement of transparency and predictability of the negotiations. The guidelines are not legally binding and do not guarantee that, even if followed, negotiations can be judged to be in good faith in each individual case as there are no clear global rules for SEP licensing negotiations. However, METI expects that various parties related to SEP licensing negotiations, such as those in the negotiations and the judiciary, utilise the guidelines, because METI established the guidelines considering the opinions of domestic and foreign companies, industries, and experts on intellectual property and competition law in Japan.
Actions to Be Taken at Each Step of SEP Licensing Negotiations
The following are the actions to be taken by a SEP holder and an implementer at each of the four main steps in SEP licensing negotiations.
While the framework based on the four steps, widely known worldwide, is useful in SEP licensing negotiations, not all licensing negotiations proceed in this order exactly. Therefore, the guidelines do not prevent the SEP holder taking the actions in STEP 3 together with STEP 1 or the implementer taking the actions in STEP 4 together with STEP 2. Moreover, if the parties go through all four steps once but they cannot reach an agreement, the parties may alternatively repeat the same actions as those specified in STEP 3 and STEP 4 thereafter.
