Study On The FRAND Principle In The Standard Essential Patents

Technical standards are the common language of human technical standpoint.The technical standard and patent jump over the gully,move towards the fusion,produce the standard essential patent.The value of standard essential patent lies in its implementation,and licensing is the most important way of implementation.With the wide application of communication technology in the field of Internet of Things,cross-industry licensing has become a prominent feature of standard essential patent licensing in the 5G era.Facing the intricately complicated licensing environment,old and new issues interweave to make it more and more difficult to operate the principle of FRAND,especially to determine the reasonable licensing fee.Therefore,it is necessary to sort out the problems in the operation of the standard essential patent FRAND principle and put forward solutions according to China’s judicial practice and patent policy.This study is divided into six chapters,which are detailed below:The first chapter mainly clarifies the legal structure of the FRAND principle.The application scope of the FRAND principle is limited to the standard essential patent,which is generated from the fusion of patent and technical standard,and is mainly defined from the perspective of “necessity”.Whether in the licensing negotiation process or in the process of litigation,the determination of standard essential patent should conform to the protection purpose of the patent law and the development law of market economy.The transparency of standard essential patents is mainly reflected in the disclosure behavior,different types of disclosure will have different effects and problems,and excessive disclosure will produce an inaccurate licensing market.The applicable conditions of FRAND principle include prerequisite condition,substantive condition and resistance condition.The existence of patent licensing behavior is its prerequisite condition,the determination of license fee is its substantive condition,and the confidentiality clause will cause the negotiation information is not transparent,which is its blocking condition.The three legal subjects of standard setting organization,standard essential patentee and standard implementer interact with each other around patent policy in the process of standard setting,especially with FRAND licensing as the center.FRAND principle is the integration of fairness principle,reasonableness principle and non-discrimination principle.After the development and evolution in the early stage and modern sense,it gradually forms a balance mechanism to protect the interests of the necessary patentee and the standard implementer.The FRAND principle is fuzzy and can be expressed in terms of positive and negative effects.The FRAND commitment under the FRAND principle has different characteristics under different legal modes.The second chapter mainly analyzes the new dynamic of FRAND principle operation and the realistic dilemma.With the change of external environment,the operating environment of FRAND principle presents some new dynamics.Among them,the complexity of licensing technology,the diversification of licensing industries and the changeability of licensing policies make the licensing environment appear complex and changeable.The development maturity of the licensing mode in the field of mobile communication and the licensing mode in the field of Internet of things is different,and they face different degrees of problems respectively,which reflects that the existing licensing mode can no longer meet the needs of the existing licensing market,leading to frequent problems of the FRAND licensing mode.The choice of jurisdiction,the confusion of judgment standards in major jurisdictions and the confusion of parallel litigation across jurisdictions further aggravate the confusion of licensing litigation.The operation of the principle of FRAND presents the difficulties of global injunctive relief,fierce disputes over the licensing conditions of global FRAND,and frequent judicial infighting between the injunctive and counter-injunctive orders.The root of the review lies in the conflict between the inclusiveness of the standard implied in the operation of the FRAND principle and the exclusivity of the patent.Facing the risk of patent hijacking and reverse hijacking and deviating from the market track for a long time.Through this analysis,important facts and problems are laid for the later research.The third chapter mainly expounds the theoretical foundation of FRAND principle.Fairness and justice,as the ethical basis of legal system,contains ethical methods which are of great value in analyzing the ethical disputes arising from the licensing of standard essential patents.The failure of private consultation mechanism and the distribution of rights and interests in standard essential patent licensing will induce ethical disputes,and the principle of good faith,as the due meaning of FRAND principle,plays a role in repairing the ethical disputes in standard essential patent licensing.As the economic basis of the FRAND principle,the transaction cost problem will be caused by non-disclosure in standard formulation,patent hijacking in licensing transaction and injunctive abuse in relief,while the FRAND principle has a moderating effect on the transaction cost in standard essential patent licensing.Interest balance as FRAND requirement specification,the principle of the standard essential patents FRAND requirement permission criteria necessary to direct conflict between the patent holder and the licensee,the deep conflict between individual interests and social public interests,the internal conflict between the social and public interests,the principle of FRAND requirement of standard necessary to balance the interest conflict in the patent license to reengineering.As the anti-monopoly value of the FRAND principle,the anti-monopoly law provides the market environment of effective and dynamic competition for the innovation and development,while the behavior of refusing permission,unfair pricing and seeking improper injunctive relief is the expression of abusing the FRAND principle to inhibit innovation.The concept of innovative development runs through the whole process of the operation of the FRAND principle.This idea should be embedded in the anti-monopoly regulation.The fourth chapter mainly explores the application of FRAND principle in the patent system.In the patent licensing system,the FRAND principle takes standard essential patent licensing as the carrier,and interacts with compulsory licensing system,implied licensing system and open licensing system in terms of convergence and application,regulatory efficacy and experience reference.The regional nature of standard essential patents is closely related to judicial jurisdiction.The court’s initiative decision on the global license rate breaks through the regional limitation of patent rights and does not accord with the original intention of the FRAND principle.The regional nature of patent rights should be upheld in the international parallel litigation caused by this.The principle of patent exhaustion will affect the licensing level in the production chain of patented products.The debate over SEP licensing levels has been difficult to reach consensus among different industries and stakeholders.The intellectual property policy of a standards-setting organization does not compel the patent holder of a standard to license any level in the production chain.The practice of evading the principle of exhaustion of patent right in the practice of standard necessary license can be improved through judicial interpretation.In standard essential patent licensing,punitive damages can be determined by the fault of both parties in licensing negotiations.It is not comprehensive to take the principle of total market value and the principle of minimum saleable patent implementation unit in the patent infringement damages compensation as the basis for the calculation of license fee,so reasonable calculation rules should be actively explored to apply to the current legal framework.The fifth chapter mainly discusses the pricing rules under FRAND principle.The pricing of license fee is the core of the standard essential patent dispute.Around the determination of license fee,a set of rules covering pricing model,pricing benchmark and pricing method has been formed.Under the system of pricing rules,market pricing model and judicial pricing model support each other in playing the role of foundation and guarantee,but in the process of interaction,judicial pricing plays a dominant role,leading to the fragmentation of pricing rules.The traditional “one-size-fits-all” view that the standard essential patentee cannot realize the value increment of the patent after its inclusion into the standard is difficult to effectively balance the patent hijacking and reverse hijacking between the standard essential patentee and the standard implementer.Similarly,it is not suitable to determine the price of standard essential patent license fee by the competitive market price before the standard essential patent is included in the standard as the pricing benchmark of FRAND license fee.In addition,the pricing method of FRAND license fee should be combined with case analysis,so it is unrealistic to apply all pricing methods uniformly and harmonically.The sixth chapter mainly puts forward suggestions on improving the application of FRAND principle in China.In view of the operation dilemma of the FRAND principle,it is a realistic and feasible scheme to repair and interpret the principle in the existing legal system under the condition that the legal system of our country is basically complete.In terms of legislation,SEP injunctive relief can be included in the future revision of the Anti-Monopoly Law to regulate injunctive relief.To solve the problem of insufficient legislation supply,we should establish an independent and unified system of injunction.In the case of the serious lag of the standardized legal system,we should unify the standardized legal system.In the aspect of administrative law enforcement,China’s intellectual property administrative law enforcement organs should actively participate in the global standard formulation and disclosure of real SEP subjects to improve the transparency of licensing,and establish a linkage mechanism between anti-monopoly illegal identification subjects and compulsory licensing authorities.In judicial judgment,we should determine the pricing rules in line with China’s reality,form a positive interaction between market pricing and judicial pricing in the pricing model,and make the determination of standard essential patent licensing fees in line with the FRAND principle in the pricing benchmark.In addition,based on the concept of pricing benchmark,more attention should be paid to the practical method of calculating FRAND license application fee,and a comprehensive pricing method should be adopted to facilitate the licensing negotiation between the parties and realize the public interest based on case analysis.At the same time,the entity adjudication rules applicable to the FRAND principle should be further refined from three aspects: taking fault as the consideration factor for determining the issuance of injunction,improving the judicial response to injunction and innovating judicial adjudication methods to decide and pay global license fees.We should improve procedural adjudication rules from two aspects: expanding judicial jurisdiction by implementing the registration system and establishing the third-party arbitration system of FRAND licensing fees.