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ITU Workshop on Standards and Intellectual Property Rights (IPR) Issues

ITU Workshop on Standards and Intellectual Property Rights (IPR) Issues. Open and closed strategy for standard setting and their relevance in developing nations . Utsab Banerjee, Tata Consultancy Services. Contents. Open and closed standards.

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ITU Workshop on Standards and Intellectual Property Rights (IPR) Issues

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  1. ITU Workshop on Standards and Intellectual Property Rights (IPR) Issues Open and closed strategy for standard setting and their relevance in developing nations Utsab Banerjee, Tata Consultancy Services

  2. Contents • Open and closed standards. • Ex ante license as an alternative to FRAND (Fair, Reasonable and non discriminatory). • Enforcement of Standards in India(case study for developing nations) . • Conclusion and suggestions. 2

  3. Open standards • Transparent. • Time taken for implementation is less. • Defensive/royalty free patent pools. “Disclose but not assert essential patent right.” e.g. Ethernet (Digitel, Intel and Xerox). Disadvantages:- • Patent owners may not agree to participate in such standard. 3

  4. Closed/Controlled standards • Licensor-licensee relationship. • Control remains with the contributors. • FRANDs are frequently used as preferred means Disadvantages:- • Hold up. • Capture share of value created by standard. • Royalty generating patent pool. 4

  5. FRAND • The term “reasonable” is vague and there are no strict guidelines in most SSO IPR policy. • IPR holders could ostensibly promise to adhere to FRAND when they are participating in standardization, and actually disregard such promise once the standards are widely implemented. • Patent holders can dictate licensing terms resulting into monopoly which can also be anti competitive. 5

  6. Ex-Ante FRAND ex ante (i.e. pre-standards) licensing E X A N T E 6

  7. Ex Ante FRAND • Participants shall disclose patents and patent application information early in the standard development process. • The substantive provision on the licensing terms to be mentioned. • Fixed royalty based on patent valuation is a viable option. 7

  8. Enforcement of Standards in India (case study for developing nations) • India is a major player both in terms of ICT R&D, market and support. • Few SSOs working in India esp. in ICT field. • Major road block is enforcement of IPR and competition laws. • Hardly any statutes or case law on standards and IPR. • Competition commission of India (CCI) still in nascent stage. 8

  9. Suggestion and Conclusion • Implementation of FRAND is problematic in India (due to enforcement issue), ex-ante FRAND seems a better option. • More power needed in hand of CCI to settle competition law issues in standards. • Safe Harbor provision in Competition Act for SSOs. • Day to day hearing in High Court and Supreme Court of cases on IP Laws and standards (as directed in Bajaj v TVS case) • Licensing terms based on the standard index of the licensee (members as well as a non participating entities). (Standard index should be calculated based on annual turnover, SME or other factors, of the licensee) 9

  10. Thank You “There is great freedom in discipline”

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