Refusal to License Intellectual Property Rights as an Abuse of Dominance under EU Competition Law: What is the Best Solution for Legal Certainty from a Rule of Law Perspective

Abstract

The researcher has adopted the rule of law as a theoretical framework to critically analyse European Union (‘EU’) competition law intervention in cases of refusal to license intellectual property right (‘IPR’). The research also examined the approaches adopted by EU judiciary and competition authorities when dealing with a competition law defence. The study was particularly focused on the ‘exceptional circumstances’ test used by EU competition authorities to assess unlawful conduct of dominant undertakings. The exceptional circumstances test under Article 102 Treaty on the Functioning of the European Union (‘TFEU’) has aggressively expanded throughout EU case law. This has resulted in inconsistencies or gaps in law as EU case law progressed which could clash, to some degree, with one of the basic elements of the rule of law: the legal certainty, predictability consistency of decision-making.
The case of finding abusive conduct by patent or standard essential patents’ owners (‘SEPs’) under EU competition law can potentially challenge the rule of law doctrine, the essence of IPRs, the protection offered under CFREU and Directive 2004/48 on the Enforcement of Intellectual Property Rights. A lot of attention in contemporary EU law has been focused on the question of when should competition law compel a dominant undertaking to license its intellectual property (‘IP’) to its rivals? And what are the required terms, if supply was found to be mandatory? These questions are discussed with reference made to EU case law starting with one of the earliest cases, Volvo v Veng, and some of the latest cases, most prominently Huawei v ZTE.
This thesis has contributed to knowledge through the use of the doctrine of the rule of law as a tool to assess EU case law and explore the extent to which the rule of elements has been met. It has also contributed to knowledge via the reflection on EU law and how it has been interpreted by national courts pre-and-post Huawei v ZTE. The UK, Germany and Netherlands are used as examples to evaluate how the EU competition law has been applied and interpreted by the domestic judiciary and to explore the implications of Huawei v ZTE on cases brought before domestic cases.
The researcher ultimately called for major reforms to Article 102 TFEU to identify its scope and limitations and its main objectives. It was concluded that the EU competition law is built on a degree of uncertainty and EU decision-making can be categorised by unconformity that could be challenged by some of the rule of law elements. The study indicated that the EU judiciary and competition law authorities could adopt an approach similar to that of the UK by examining the legitimate expectations of both right-holders and licence seekers as opposed to the examination of the legitimate expectations of licence seekers.