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Competition Law

Analysis - debate - current awareness

06 DEC 2011

Technology Transfer Review

On 6 December 2011, the European Commission published a questionnaire inviting views on the current regime for the assessment of technology transfer agreements together with a report on the relationship between the EU competition rules and the protection of intellectual property rights. The current technology transfer block exemption regulation (TTBR) and corresponding guidelines are due to expire on 30 April 2014.

The current TTBR applies only to bilateral agreements for the licensing of software copyright, patents and know how (or a mixture of these). The fact that the agreement makes provision for the sale and purchase of products which relate to the licensing does not preclude application of TTBR, provided those provisions do not constitute the primary object of the agreement (if they do, then the agreement may benefit from the block exemption for vertical agreements).
The other main conditions governing the application of TTBR are:

  • Market share thresholds: the thresholds differ depending on whether the parties to the agreement are considered to be competitors. For competitors, the combined share must not exceed 20% and for non-competitors, 30%.
  • No hardcore restrictions: hardcore restrictions include price-fixing, limitations on output, and allocation of markets or customers (although this is permitted to a limited extent).

There is also a category of ‘excluded restrictions’ which require individual assessment but do not prevent the TTBR from applying to the remainder of the agreement provided the excluded restrictions are severable. These include: requirements on the licensee to grant back to the licensor innovations and improvements based on the rights licensed and no challenge provisions.

The questionnaire issued by the Commission is designed to elicit feedback from stakeholders that have direct experience of the current regime. It seeks views on issues raised in the report on the relationship between competition and intellectual property rights (cross-licensing, patent pools and grant backs) and on the operation of the TTBR and guidelines. 

Responses to the consultation should be submitted by 3 February 2012.

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