SEP licenses should be available to all companies in a supply chain that want a license for SEPs in their products – Supporting references

Brussels, February 15, 2021 – On 24th June 2016 the Fair Standards Alliance published a position paper concerning the failure of some SEP holders to comply with the non-discriminatory requirement of FRAND by refusing to license companies who would like a license to SEPs used in their products. The paper addressed the negative impact of such discriminatory licensing practice on the product ecosystem and on consumers. It explained why this practice is not acceptable and why FRAND SEP licenses must be available to all entities, regardless of their role within the product supply chain.

Some highlights from this position paper include the following:

• The non-discriminatory requirement of the FRAND policy means that SEP licenses must be available to all entities, regardless of their role within the product supply chain; accordingly, SEP licensors shall not refuse to provide licenses to willing licensees including at the level of intermediate subsystem manufacturers;
• Subsystem manufacturers are better equipped than end-product manufacturers to assess patent assertions by SEP licensors, and to monitor the evolution of the standardized technologies that are incorporated within their products.
• Most, if not all, of the inventive aspects of a SEP holder’s patent claims only apply to the sub-system that implements the standard;
• Some SEP holders discriminate by offering different licensing rates for the same technology at different levels of the supply chain;
• The ecosystem is placed at risk by the unfair and discriminatory practices of some SEP holders who attempt to unreasonably take value from the end product, effectively placing a tax on the value chain.
• Such practices have the potential of reducing the attractiveness of the standardised technology to the end-product manufacturer. In turn, this hinders the propagation of the standard and may deprive the end consumer of the benefit of the technology.

As a follow up to that position paper, the FSA thought it would be helpful for SEP licensors and prospective licensees of SEPs to have an easy to reference document that highlights some of the supporting policy statements and supporting case law.

We would be interested to hear of other policy decisions and case law that interested parties are aware of, and we shall explore the possibility of publishing an update in the future.