Chapter 7 Intellectual Property Rights and Competition Policy

Interface between Intellectual Property and Competition Law: Essential Facilities Doctrine

It is generally viewed that Intellectual property protection and competition law are odds with each other. Is there really any tussle between intellectual property protection and competition law? Intellectual property law creates and protects monopoly power and the other seeks to exclude it. IP exclusion provisions are included in the Indian Competition Act, 2002 in Section 3(5). This is to provide enforcement to intellectual property rights. But protection of intellectual property rights are not per se violates any competition provisions. The objective of competition law is to prohibit anti-competitive practices and the objective of both the stream is wealth maximization in any economy. Intellectual property protection is necessary to foster innovation and choices of products in the market. It infuses efficiency in the market and increases consumer welfare. India is in the nascent state of its administration of competition laws. There are sizable number of cases came before the Indian competition authorities (CCI) and Indian courts. Cases against Microsoft India and abuse of dominant case against Ericsson filed by an Indian company named Micromax is only the beginning of the interface cases on intellectual property and competition law. There is no sufficient case laws and jurisprudence is available in India in guiding the Indian authorities and courts on the interface between intellectual property and competition. It is necessary to make an analysis of the jurisprudence in the US and EU. First part of this paper deals with the US Antitrust Act, 1890 and analysis of a number of cases dealt by the US courts. The EU Regulations and cases are clearer on issues of intellectual property and competition law. Indian jurisprudence is not clear so far and few cases are dealt by the CCI and Indian courts. The study concludes that Indian authorities should learn from other jurisdictions and the jurisprudence will act as guideline for Indian authorities.

The Interface of Competition and Intellectual Property Law – Taking Stock and Identifying New Challenges

Intellectual Property Rights and Their Interface with Competition Policy: In Balance or in Conflict?

Innovation is central to competition policy. Indeed, in some industries, it is the primary means by which firms compete. The metaphors are dramatic: innovation is a ‘life and death matter for the firm’ and ‘a weapon in the arms race of competition’. Even more fundamentally, innovation, economists tell us, is pivotal to the capitalist economy as a whole. Baumol, in his book on innovation, declares that it is innovation that drives economic growth and that, without it, economies stagnate. Despite the well-established role of innovation in competition law and policy, however, the contribution such a perspective brings to the particular innovation issues raised in Gray’s case, the subject of discussion in other chapters, is limited. A contest between an employer and employee for intellectual property rights to an invention has clearer implications for labour, intellectual property and corporate law. The response of competition law to this issue, it seems to me, is far less clear. In broad terms, competition law and policy is concerned with the promotion of competition or, putting it in the more negative terms of competition legislation, prohibiting conduct that lessens competition.5 With this focus, competition law would seem to have little interest, in a general sense, in whether intellectual property rights are granted to an employer or an employee. It is true that there is a well-established interface between competition and intellectual property laws and, in a broad sense, some of this interaction may be relevant. This is because competition law, like intellectual property law, sees innovation as one of its key aims.

The investment activity is diverse and can be carried out with the use of intellectual property rights in accordance with the current international and Russian investment law. The article aims to identify the specifics of the application of intellectual property rights as investments and the implementation of intellectual investments, i.e. investments endowed into intellectual property rights. The objectives of the study are to consider the categories of an investment and object of investment activity, intellectual property, exclusive and other intellectual rights, as well as to analyze and determine the features of legal regulation of the activity in question at the international and national levels in the Russian Federation. Based on the results of the systematic analysis with the use of formal legal, comparative and other research methods, it is concluded that investments as a property in a broad sense may include both exclusive and other non-personal intellectual property rights to the results of intellectual activity and equated means of individualization of goods, works, services and enterprises. At the same time, they exclude intellectual property itself as a set of various types of intangible products, moral and other personal non-proprietary intellectual rights by virtue of their inalienable and non-transferable character. It is argued to be the same with respect to the object of investment activity, i.e. the property which the investment is endowed in and is capable to bring income to the investor in the future. Investments into such intellectual property rights can be called as intellectual investments.The legal regulation of investment activity with the use of intellectual property rights has a dual character (in the sense that it is carried out by different investment legislative acts with the similar subject of their regulation) and depends on the type of a particular object used. If intellectual property rights are invested in fixed capital, then they are to be recognized as capital investments and are governed by the Federal Law of February 25,1999 No. 39-FZ “On Investment Activity in the Russian Federation Carried out in the Form of Capital Investments”. If intellectual property rights are used as the object of investment activity, i.e. where investments are endowed in, such intellectual investments are subject to the regulation by the Law of the RSFSR of June 26, 1991 No. 1488-1 “On Investment Activity in the RSFSR”.

IP Law Reform and the Treaty of Lisbon

Intellectual Property Rights and Standard-Setting Organizations

Author(s): Lemley, Mark A. | Abstract: The role of institutions in mediating the use of intellectual property rights has long been neglected in debates over the economics of intellectual property. In a path-breaking work, Rob Merges studied what he calls collective rights organizations, industry groups that collect intellectual property rights from owners and license them as a package. Merges finds that these organizations ease some of the tensions created by strong intellectual property rights by allowing industries to bargain from a property rule into a liability rule. Collective rights organizations thus play a valuable role in facilitating transactions in intellectual property rights.There is another sort of organization that mediates between intellectual property owners and users, however. Standard-setting organizations (SSOs) regularly encounter situations in which one or more companies claim to own proprietary rights that cover a proposed industry standard. The industry cannot adopt the standard without the permission of the intellectual property owner (or owners).How SSOs respond to those who assert intellectual property rights is critically important. Whether or not private companies retain intellectual property rights in group standards will determine whether a standard is open or closed. It will determine who can sell compliant products, and it may well influence whether the standard adopted in the market is one chosen by a group or one offered by a single company. SSO rules governing intellectual property rights will also affect how standards change as technology improves.Given the importance of SSO rules governing intellectual property rights, there has been surprisingly little treatment of SSO intellectual property rules in the legal literature. My aim in this article is to fill that void. To do so, I have studied the intellectual property policies of dozens of SSOs, primarily but not exclusively in the computer networking and telecommunications industries. This is no accident; interface standards are much more prevalent in those industries than in other fields. In Part I, I provide some background on SSOs themselves, and discuss the value of group standard setting in network markets. In Part II, I discuss my empirical research, which demonstrates a remarkable diversity among SSOs even within a given industry in how they treat intellectual property. In Part III, I analyze a host of unresolved contract and intellectual property law issues relating to the applicability and enforcement of such intellectual property policies. In Part IV, I consider the constraints the antitrust laws place on SSOs in general, and on their adoption of intellectual property policies in particular. Part V offers a theory of SSO intellectual property rules as a sort of messy private ordering, allowing companies to bargain in the shadow of patent law in those industries in which it is most important that they do so. Finally, in Part VI I offer ideas for how the law can improve the efficiency of this private ordering process.In the end, I hope to convince the reader of four things. First, SSO rules governing intellectual property fundamentally change the way in which we must approach the study of intellectual property. It is not enough to consider IP rights in a vacuum; we must consider them as they are actually used in practice. And that means considering how SSO rules affect IP incentives in different industries. Second, there is a remarkable diversity among SSOs in how they treat IP rights. This diversity is largely accidental, and does not reflect conscious competition between different policies. Third, the law is not well designed to take account of the modern role of SSOs. Antitrust rules may unduly restrict SSOs even when those organizations are serving procompetitive ends. And enforcement of SSO IP rules presents a number of important but unresolved problems of contract and intellectual property law, issues that will need to be resolved if SSO IP rules are to fulfill their promise of solving patent holdup problems.My fourth conclusion is an optimistic one. SSOs are a species of private ordering that may help solve one of the fundamental dilemmas of intellectual property law: the fact that intellectual property rights seem to promote innovation in some industries but harm innovation in others. SSOs may serve to ameliorate the problems of overlapping intellectual property rights in those industries in which IP is most problematic for innovation, particularly in the semiconductor, software, and telecommunications fields. The best thing the government can do is to enforce these private ordering agreements and avoid unduly restricting SSOs by overzealous antitrust scrutiny.

Intellectual Property: The Promise and Risk of Human Rights

Innovation is a commercially risky and legally perilous process. It is risky because large sunk costs are often required to initiate and sustain research, product development and other steps involved in the offering of the product and winning of the market. At the cusp of commercial success however, firms have to contend with uncertainty as to whether the manner in which they exploit any intellectual property (IP) rights they have, or may be acquiring, will pass the scrutiny of competition laws. In the wake of a recent Microsoft decision in the European Union and developments elsewhere, companies have had to reassess their corporate strategies, not merely at a local or regional level, but because of the nature of IP exploitation today, on a global scale as well. This paper begins with a reflection on how courts and competition authorities regard various legal strategies implemented in the exploitation of IP rights. The discussion includes an evaluation of the legitimacy of regulatory responses to these strategies as well as the regulatory schism that impacts trans-border IP strategies. The paper then considers how firms can maximise the value of their IP within the present regulatory environment by influencing the normative framework of competition policy. The limits of this influence are explored and the paper concludes with a discussion on how global trends are likely to shape the strategic landscape arising out of the interface between IP and competition law in the years ahead.

Introduction The purpose of this chapter is to present an economic analysis of intellectual property right (IPR) law and its relationship with competition policy. The relevant economic literature on this subject is enormous and complex. Here, we will strive for simplicity, trying to extract the main concepts and proposing simple principles that might help to guide the application and design of both intellectual property and antitrust laws. While our analysis does not account for every single aspect of intellectual property law or every single competitive situation, we do believe that the analysis does derive useful general principles. The overriding thesis of this chapter will be the separation of intellectual property and competition law. This separation will apply to the design of the law: IP law should limit itself to properly assigning and defending property rights while competition law should be concerned with the use of such property rights. More precisely, competition law should be concerned only with the use and abuse of property rights that are sources of monopoly power. This principle of separation also applies to the enforcement of the law. The main theme here is the equality of treatment of various sources of monopoly power, i.e. of the use of various property rights. We will argue that once property rights of various types have been properly assigned, there is no reason for competition policy to further distinguish between the sources of monopoly power.

Decentralizing the lawmaking function: Private lawmaking markets and intellectual property rights in law

Decentralizing the Lawmaking Function: Private Lawmaking Markets and Intellectual Property Rights in Law

Beyond 'Essential Facilities': Innovation, Intellectual Property and Competition Policy Across the Atlantic