The refusal to license IPRs : an evaluation of the approach taken by the EU in contrast to that of the U.S.

Abstract

When it comes to treating cases surrounding a firm’s refusal to license intellectual property rights, the EU and US approaches have been of great interest due their contrasting procedures in this context. Whilst some converging elements exist between the approaches, the principal concern lies in why a refusal to license an IPR would be deemed lawful under one approach, when there is a great possibility that it would be deemed unlawful in another. A harmonisation in approaches would sanctify the position of the IP owner within the competition and antitrust realm, and would create a sense of uniformity as well as stronger enforceability. Currently, no clear sense of harmonisation exists amongst the EU and US with regards to the refusal to license IPRs. The EU is motivated to ensure the completion of the single market, and thus the freedom and functioning of competition within the market is a key factor, which is taken into consideration when coming to verdict on a refusal to license case. The US is freed of such underlying considerations and this is consequently reflected in its attitude towards protecting the IP owner in most cases.

EU and US legislation, and its application within its cases play a strong role in shaping the manner in how a refusal to license is handled under one approach in contrast to another. Where the EU sets out a rigid and criteria-based approach in analysing the refusal at hand, the US tends to adopt a less formal attitude, and this approach therefore has created some signs of inconsistency within US case law itself. Both approaches present its differing strengths and weaknesses, and recommendations for improvement as well as for convergence are addressed in the conclusion of this paper.