FRAND ahoy! The EU SEP consultation is here

Hard on the heels of reviews of SEP policy in the US (now closed - see here); the UK (open until 1 March - see here) and Japan (revision of Guide to Licensing Negotiations Involving Standard Essential Patents, planned for 2022 - see here), the EU has now published an impact assessment and consultation on standard essential patents. 

The first surprise is that the consultation is very much an initial evidence-gathering exercise - while the Commission webpage indicates that a Regulation is proposed, the survey of industry participants is pitched at the information-finding level. The impact assessment (IA) is somewhat more interesting. Three key areas are in focus: (i) enhanced transparency of SEPs, through better databases and independent essentiality assessments; (ii) clarity on the concept of FRAND, including the question of where in the value chain licensing takes place; (iii) improved efficiency of enforcement, by incentivising alternative methods of dispute resolution.

The top 5 themes to emerge from a first read through are:

1. The wider context: the review is part of a "recalibration of EU patent law" to which the imminent launch of the UPC is central, alongside other initiatives on compulsory licensing, standardisation and SPCs. 

2. Balance: this is a thread running through the IA: between SEP holders and SEP implementers, between hold-up and hold-out, between cost and income.  

3. Transparency: Like the SEP expert group report, transparency features heavily, whether that is transparency of the SEP landscape or of the commercial terms offered by licensors. Efficiency and predictability are also watchwords.

4. The global context: The IA refers both to EU Court decisions, but also to those of the UK Supreme Court (admittedly before the UK's final departure from the EU). Question 5 of the survey also asks about the impact of judgments in the UK, China and India, as well as Germany. 

5. Still no legal certainty: The EU remains open as to whether any action will be legislative or non-legislative, potentially including guidance under the EU's competition law framework.

Overall, the topics that emerge for key consideration are aligned with key proposals made by the EU SEP experts group. However, the main takeaway is therefore that, for now at least, it is still going to be some considerable time before the future SEP/FRAND landscape in the EU becomes clearer. In the meantime, there will no doubt be plenty of scope for further dispute and judicial development of the way in which existing rules are interpreted and applied.