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Ares(2015)5541 - 05/01/2015

EUROPEAN COMMISSION
DIRECTORATE-GENERAL FOR COMMUNICATIONS NETWORKS, CONTENT AND TECHNOLOGY
Director for Coordination

Brussels,
CNECT.F/F2/EDG

Mr. Tim Frain,

Director IP Regulatory
IP Business
Nokia
e-mail:
tim.frain@nokia.com

Subject: IEEE – Proposed Patent Policy modifications

Dear Mr. Frain,

We thank you for your letter of 18th December 2014 in which you express your concerns
about the proposed changes in the IEEE Patent Policy.

The Commission services are closely following the debate on IPR policies in the
different standards development organisations. As you know, the Commission has been
advocating a fair balance between the interest of standard essential patents (SEP) holders
to be appropriately remunerated for their IP and the interest of implementers of standards
to get access to standardised technology on FRAND (fair, reasonable and non-
discriminatory) terms. This is important to ensure sustainable standardisation systems
and to support the European Digital Single Market, innovation and competitiveness. The
European Commission is currently conducting a public consultation on patents and
standards, which should yield information which will contribute to the continued
effectiveness of the standardisation systems.

The Commission has recently adopted two antitrust decisions on SEP-based injunctions
(Motorola Mobility and Samsung Electronics). The Advocate General of the European
Court of Justice has provided an opinion on an SEP-related case (C-170/13 Huawei
Technologies vs ZTE). The antitrust decisions state that SEP-based injunctions should be
available when there is an unwilling licensee, whereas the seeking of injunction on the
basis of SEPs against a willing licensee can constitute an abuse of dominant position.

On the basis of the information available to us, we would consider that "the use of the
value of the relevant functionality of the smallest saleable compliant implementation that
practices the SEP as basis to calculate the reasonable rate for the patent holder"1 would
constitute a change in the IEEE policy and that such a policy may risk having a
significant impact. We would expect that such a change, and its potential consequences

1
Text from the draft proposal 39 to amend IEEE Standards Bylaw.

Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË - Tel. +32 229-91111

Office: BU25 5/55 - Tel. direct line +32 229-62188
for the standardisation eco-system, would be carefully examined before a decision would
be taken to implement it. In any event, standard development organisations should follow
the key principles established by the WTO, i.e. transparency, openness, impartiality,
consensus, efficiency, relevance and consistency.

For other issues related to possible improvements in the IPR policy in standard
development organisations, we refer to the speaking points of the Commission services
used both in ETSI and ITU-T which you have at your disposal.

Yours sincerely,

(e-signed)
Gerard de Graaf

Cc: Viorel Peca, Emilio Davila Gonzalez, Irina Orssich, (DG CONNECT) Eliana
Garces-Tolon, Torsten Frey, Anne von-Zukowski, Wawrzyniec Perschke,
Michael Koenig, (DG GROWTH), Thomas Kramler, Szilvia Szekely, Gunnar
Wolf, Anna Vernet (DG COMP)