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Access to standard essential patents and antitrust enforcement: the case for licensing component manufacturers

Access to technical standards is very important in numerous industry sectors. Since standards are often patent protected, such access requires the licensing of patents that are essential to the practice of these standards. Developing such standards often requires substantial investment in R&D, for which the patent holders want to be rewarded. But patent holders also try to take advantage of the fact that they possess an asset that is indispensable in order to be able to compete on various markets. This leads to patent wars between the right holders and manufacturers who implement technologies based on patent protected inventions in their products or those who distribute such products. Unsurprisingly, disputes concerning standard essential patents attracted a significant degree of attention from scholars who concentrated on the availability of injunctive relief and reasonable royalties. Recently, the issue that is particularly debated in multiple jurisdictions is the practice of standard essential patents (SEPs) holders refusing to license the manufacturers of components where such patented inventions are implemented (such as chips allowing communication with mobile networks), and instead licensing the manufacturers of final products (such as mobile phones or smart cars). The major question is whether such a practice of patentees should lead to liability under competition laws. The interface between IP and competition law has always been a subject of intensive scholarly debate. The issue of licensing at the component level offers a chance to look at that interface once again. This paper aims to analyse the role (if any) that competition law could play in ensuring access to standard essential patent licenses for component manufacturers. In order to achieve this, paper begins with a short introduction of the problems related to standardization and access to SEPs. It also briefly presents the disputes concerning the licensing of SEPs and the potential role for competition law. Then the author describes the market power that results when a patent, upon adoption of a standard, becomes standard essential, and the dangers of hold-up by the patentees and hold-out on the side of the implementers. Having introduced the most fundamental concepts,