From exclusivity to inclusion in the field of standard essential patents: How to make an inclusive entitlement inclusive

Technology standards determine the availability and diffusion of innovative products, which have the potential to benefit society. Standard’s broad deployment enables demanders with low purchasing power to access state-of-the-art devices that can work efficiently with the sophisticated products or services of high-paying demanders (innovation inclusion). Meanwhile, a regime conferring exclusivity to the relevant technologies (technology exclusion) can be detrimental to the positive effects of technology standards. Almost ten years ago, the Court of Justice of the European Union (CJEU) reduced the aforementioned level of exclusivity by establishing an inclusive entitlement for all users of standard essential patents (SEPs), which are subject to the declaration to license under fair, reasonable and non-discriminatory (FRAND) terms and conditions. Although Huawei v. ZTE represented a landmark decision, the substantive approach subsequently taken has not yet led to the desired level of inclusion. Among the core reasons for that are the information deficit of implementers and the failure of courts to apply the framework in an inclusive manner. The recent proposal for a Regulation on SEPs by the European Commission entails the creation of an administrative superstructure to generate inclusion, the realisation of which, however, carries significant costs. This paper takes a critical look at pertinent developments and advances a two-dimensional adjustment of the post-Huawei framework as a minimally invasive alternative which should be further developed and tested in the future if the Commission’s proposal does not become reality.