Brussels, September 1, 2020 – The U.S. Department of Justice’s (DOJ) Antitrust Division issued a business review letter on 28 July 2020 concerning Avanci’s platform for licensing “Fifth Generation” (5G) telecommunications technology in the automotive industry. In this non-precedential letter that does not bind U.S. or other national courts or regulatory agencies, the DOJ states that it does not intend to initiate enforcement action against the proposed 5G automotive licensing program.
The Fair Standards Alliance (FSA) acknowledges that patent pools licensing standard essential patents (SEPs) can have notable benefits for businesses, but only in so far as the pools comply with and are bound by their members’ commitments to license SEPs on fair, reasonable and non-discriminatory (FRAND) terms. Patent pools that aggregate rights of several SEP holders and act as their licensing agents must adhere to rigorous safeguards, including those foreseen by competition law.
It is unfortunate that the DOJ failed to acknowledge in the business review letter (the letter) that refusing SEP licenses to willing licensees solely because of where in the value chain they operate violates a FRAND commitment and may raise significant competition concerns. The basic principle that FRAND licenses should be available to anyone in the supply chain has been acknowledged by courts and competition enforcers in numerous jurisdictions. By not endorsing this principle, the DOJ appears to set itself apart from numerous international authorities, and to dismiss longstanding industry practices.
Download full statement here.