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According to Nokia, unilateral drafts of EU patent rules undermine Europe

25. 04. 2023 Tuesday / By: Robert Denes / Industrial / Exact time: BST / Print this page

A draft EU rule aimed at avoiding disputes over patents essential to key technologies for telecommunications equipment and connected cars appears to shift the burden and costs onto patent owners, potentially undermining Europe's leadership in these areas, Nokia said.

The Finnish telecommunications equipment maker, whose Standard Essential Patents (SEPs) generate about €1.5 billion ($1.7 billion) in revenue and account for almost 40% of its profits, came two days before the European Commission submits the draft and rules.

Under the proposal seen by Reuters, patent holders would have to register their patents with the EU Intellectual Property Office (EUIPO) if they want to charge patent fees or take legal action. EUIPO also oversees the process of determining fair, reasonable and non-discriminatory (FRAND) royalties, which must be concluded within nine months.

The proposal is unbalanced and ignores a key concern for patent owners, said Nokia's head of intellectual property policy, Collette Rawnsley.

"The leaked draft decree appears to be one-sided, with additional obligations, burdens and costs falling on SEP owners, not on implementers," he said in an interview with Reuters.

"Unfortunately, nothing in the proposal addresses the issue of withholding when bad faith implementers avoid or delay obtaining licenses and payments for the innovative technology they use."

He said Europe, currently the leader in cellular standards, could even lose its lead under the draft rules.

"EU regulatory intervention and changes to the SEP licensing framework risk making European standardization forums less attractive. This could undermine Europe's leadership in these critical technologies," Rawnsley said.

"The majority of patent license agreements are negotiated amicably. Litigation is rare and always a last resort. Unfortunately, litigation is sometimes necessary to bring recalcitrant executors to the table to negotiate a FRAND license in good faith," he said.

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