Research On Competition Effect Patent License Grant-back Clause

In recent years,the grant-back clause has been one of the typical patent abuse cases in patent licensing contracts.Patent litigation cases are frequently reported in high-tech industries.The classic case is the case of China's Qualcomm case in 2014.the grantback clause requires the licensee to reverse license the new technology resulting from the further improvement of the original technology to the patent licensor,both competitively and anti-competitively.At present,there are few antitrust legislation in our country and antitrust law enforcement is lack of basis.Therefore,this article is mainly based on "the behavioral mechanism of grant-back-the governance mechanism of grant-back-the antitrust review method of grant-back-grant-back antitrust regulatory policy " to analyze the basic logic,and on the basis of this,we put forward suggestions on the abuse of antitrust policies.The core issues of the main research are as follows:First,the theory of incomplete contract is used to explain the motivation of the patent holding company to implement grant-back.By constructing a grant-back behavioral incentive model,when the licensor and the licensee are not in a competitive relationship,the grant-back is found to be profitable for both the licensor and the licensee.The grant-back is a risk sharing mechanism.Due to the uncertainty of the future technology,the licensor is included in the license contract to provide grant-back clause in order to ensure that its own interests are protected from the loss and the technical exchange proceeds smoothly.Besides,the grant-back clause can force patent licensors to select high-capacity licensees,while high-capacity licensees have the ability to innovate,which to a certain extent can also promote technological progress.Second,the welfare of grant-back are discussed in two situations: the licensor and the licensee are in a competitive relationship,and the licensor and the licensee are not competing.The grant-back can reduce the licensee's R & D enthusiasm regardless of whether the licensor and the licensee are competing.Case 1.When the licensor and the licensor are not in a competitive relationship,the licensor's R & D incentive is not easy to determine.On the one hand,the licensor will reduce its R & D as it now has partial benefits for the licensee to R & D results.On the other hand,if the licensor knows that Licensee will reduce its R & D investment,it will induce the licensor to actively research and develop.In addition,whether the grant-back will reduce the benefits of R & D phase depends on the difficulty of innovative projects,if the innovation is easier then the grant-back is beneficial,otherwise it is harmful to the market;Case 2.When the licensor and the licensee are in a competitive relationship,the grant-back analyzes the impact on the overall social welfare(including consumer welfare).By building a mathematical model,it is found that different degrees of innovation of the licensee will have different impacts on the total profit of the enterprise.If the type of innovation is non-severable innovation,the grant-back will increase the total profit of the two enterprises.If the type of innovation is severable innovation,then the grant-back will reduce the total profits of both businesses.From the perspective of the licensee,it is found that,regardless of the degree of innovation,the grant-back will reduce the profits of licensee's enterprises.As the two companies are in a competitive relationship,the grant-back enables both companies to produce products with new technologies.Under the premise of keeping the basic mathematical assumptions unchanged,the result will be a decrease in price and an increase in consumer welfare.From the point of view of total social welfare,social welfare of grant-back is uncertain and needs to be considered in combination with the type of innovation and the size of R & D expenditures.Finally,the grant-back of antitrust policy design.Based on the above analysis of the mathematical model,the grant-back have both efficiency improvement effect and anti-competitive effects.Because of it can not determine the circumstances under which the grant back will be illegal,so the principle of anti-monopoly review should be based on Efficiency Presumption Principle.There are many shortcomings in the existing antimonopoly policy,the urgent need to innovate and improve the anti-monopoly policy system.The antitrust review of grant back needs to be based on a three-step approach of "Competency-Motivation-Total Impact".In antitrust review of grant back,consideration should also be given to factors such as the degree of innovation and the type of grant back.