Biden executive order calls for SEP revision
The Biden administration has issued a sweeping executive order to spur competition in the US economy, which provides a significant boost to the licensees of standard-essential patents (SEPs).
President Joe Biden signed the order on Friday, July 9, backing 72 initiatives intended to address pressing competition problems and promote long-term growth across the US economy.
‘Revise policies on SEPs’
The order stipulates that to avoid the potential for anticompetitive extension of market power beyond the scope of granted patents, and to protect standard-setting processes from abuse, the US attorney general and the US secretary of commerce should consider whether to revise their position on the intersection of the IP and antitrust laws.
This includes considering whether to revise the policy statement on remedies for SEPs subject to voluntary fair, reasonable, and non-discriminatory (FRAND) commitments.
The Fair Standards Alliance (FSA), whose members include Google, Apple Cisco, Dell and Intel, welcomed the development, stating that it was a positive step to ensure that SEPs are licensed on FRAND terms.
The order also encourages the chair of the Federal C o mmunications Commission to consider providing support for the continued development and adoption of 5G open radio access network protocols and software, to attend meetings of voluntary and consensus-based standards development organisations, and to promote or encourage a fair and representative standard-setting process.
It also asks the chair to undertake any other measures that might promote increased openness, innovation, and competition in the markets for 5G equipment.
Robert Pocknell, chair of the FSA, said: “Any measures which ensure that SEP holders meet their contractual promises and comply with competition law is welcome; the refusal of some SEP holders to grant SEP licenses to companies in the supply chain is discriminatory and unfair. Transparency in the standards-setting process, and in the licensing terms sought by SEP holders, is also key to encouraging innovation, investment and fair competition”.
The order will also enable the Federal Trade Commission (FTC) to create a policy that will more closely scrutinise mergers by dominant internet platforms, particularly those aspiring to acquire competitors, those offering free products, or accumulating large amounts of data.
“Without healthy competition, big players can change and charge whatever they want and treat you however they want,” Biden said in a speech on Friday.
FTC chair Lina Khan and acting assistant attorney general of the Department of Justice (DoJ)’s antitrust division said in a statement that merger guidelines should reflect “economic realities and empirical learning”, adding that “the current guidelines deserve a hard look to determine whether they are overly permissive”.
A vacant antitrust post
The development comes as the US President comes under mounting pressure to appoint a head of the DoJ’s antitrust division. Some detractors have noted the discrepancy between President Biden’s tough antitrust rhetoric and his failure to nominate someone for the top antitrust role at DOJ despite being in post for 168 days—the longest a modern president has gone without making an appointment for the role.
The broad range of actions within the order addresses a plethora of issues, including enhancing labour rights, reducing prescription drug prices, restricting airline fees, and giving bank customers more flexibility to change accounts.
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