The link between innovation and economic growth has been widely acknowledged. So it comes as no surprise that the promotion of innovation has become a priority of company strategies and government policies. A major regulatory challenge in this paradigm is to craft a well-balanced design of competition law and intellectual property (IP) in a way which allows this Schumpeterian insight concerning innovation economics to be applied consistently. So far it has often been argued that equating intellectual property rights (IPRs) to conventional property rights in the course of antitrust assessment constitutes a proper approach which encourages methodological consistency. However, some examples of ongoing litigation concerned with the exercise of the FRAND_encumbered standard essential patents (SEPs) leave the impression that competition authorities might be departing from this approach and moving towards more IP-specific antitrust analysis. Furthermore, chief economists of the EU Commission and the Federal Trade Commission (FTC) have recently made some proposals for possible reforms to the IPR policies of standard setting organizations (SSOs). In their article, they strongly emphasize the adverse impact of opportunistic behaviour within standardization since such behaviour can harm consumers and threaten the incentive to innovate. They also assert that SSOs have the responsibility to ensure that this risk is mitigated through an IPR policy that properly addresses this issue. This context gives rise to related claims that many existing SSO policies are not strong or clear enough to achieve this goal.
But what is the meaning and effect of this message conveyed to SSOs? This article aims to provide further clarification as to the proper role of antitrust law in shaping and informing originally user-generated internal IP policies of SSOs, i.e. to what extent they should be governed and constrained by the practice and recommendations of competition authorities.
To this end, we start by examining the standard setting landscape in the ICT sector in section 1. Section 2 presents some challenges associated with the IPRs and standards. Section 3 provides a brief overview of the cases initiated by the competition authorities of the EU and US in the context of standardization. This will serve as the basis for section 4, in which we examine the extent to which the outcomes of antitrust investigations should be incorporated into SSO practice. We summarize our conclusions in section 5.