Competition law and patent pools—their advantages and risks
Produced in partnership with Collyer Bristow LLP
Competition law and patent pools—their advantages and risks

The following Competition guidance note Produced in partnership with Collyer Bristow LLP provides comprehensive and up to date legal information covering:

  • Competition law and patent pools—their advantages and risks
  • Patent pools: advantages and risks
  • Patent pool’s potential to infringe Article 101 TFEU
  • Reducing risk of infringement via pool management

Intellectual property rights (IPRs) are more obviously associated with Article 102 TFEU, as they confer a monopoly on the rights-holder.

However, agreements between undertakings relating to the licensing and the use of IPRs have the potential to infringe Article 101 TFEU. A useful roadmap of the danger areas is set out in Section IV of the Guidelines accompanying the Technology Transfer Block Exemption (the Guidelines).

Section IV of the Guidelines concerns the application of Article 101 TFEU outside the safe harbour of the block exemption. It mainly covers IP licensing of any type outside the safe harbour, for example because market share thresholds are exceeded. However, the final two parts concern specific types of agreement:

  1. Section IV, Part 3: dispute settlement agreement (see further, Competition law and settlement agreements )

  2. Section IV, Part 4: technology pools (sometime called patent pools).

Patent pools: advantages and risks

Advantages of patent pools

Patent pools are arrangements whereby two or more patent-holders contribute their respective technologies to a single package which can be licensed to contributors or to third parties. They have various pro-competitive advantages:

  1. for licensors: pools reduce the risk of dispute between competitors challenging each other’s patents or alleging infringement of their own. The first recorded pool—the 1856 'Sewing Machine Combination'—came about for precisely this reason, settling the 1846-1856 'sewing machine wars' between Singer