Revision of the new Technology Transfer Block Exemption Regulation: Convergence or capitulation

The Evolution of European Competition Law: Whose Regulation, Which Competition?

Volumn , Issue , 2006, Pages 53-70

  Patterson, Mark R ^a  

^a FORDHAM UNIVERSITY   (United States)

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EID: 84856653508     PISSN: None     EISSN: None     Source Type: Book    
DOI: None     Document Type: Chapter

References (51)

1. Charles A. James, Assistant Attorney General, Antitrust Division, US Department of Justice, Antitrust in the Early 21st Century: Core Values and Convergence, US Mission to the (discussing convergence of US and EC antitrust law) European Union, Brussels, 15 May 2002http://www.useu.be/Categories/Antitrust/May1502JamesAntitrust-Speech.html
2. Commission Evaluation Report on the Transfer of Technology Block Exemption Regulation No. 240/96, COM(01) 786 final [hereinafter TTBE Report], at 5 ('The recent reforms of the EC competition rules in the field of vertical and horizontal agreements have signified a shift from a legalistic and form-based approach to a more economic and effects-based approach'), available at http://europa.eu.int/comm/competition/antitrust/-technology_transfer/en.pdf
3. Speech by Mario Monti, The New Shape of European Competition Policy, Competition Policy ('When I was appointed Competition Commissioner four years ago, one of my main objectives was an increased economic approach in the interpretation and enforcement of European competition rules.') Research Center, Tokyo, Japan, 20 November 2003, http://jpn.cec.eu.int/home/speech_en_Speech202020November202003.php
4. Speech by Mario Monti, Antitrust in the US and Europe: A History of Convergence, General Counsel Roundtable, American Bar Association, Washington, DC, 14 November 2001, http://europa.eu.int/rapid/start/cgi/guesten. kshp_action.gettxt=gtdoc=SPEECH/01/540%7C0%7CRAPIDlg=EN
5. C. A. Jones, 'Foundations of competition policy in the EU and USA: Conflict, convergence, and beyond', this volume, Chapter 1.
6. Commission Regulation 772/2004 on the application of Article 81(3) of the Treaty to categories of technology transfer agreements, OJ L 123/11 (2004) [hereinafter Final TTBER]
7. Commission Notice: Guidelines on the application of Article 81 of the EC Treaty to technology transfer agreements, OJ C 101/2 (2004) [hereinafter Final Guidelines].
8. Monti TTBER Revision Speech (speaking about the revision of the TTBER and stating that 'we will implement a similar general economic approach to all agreements under Article 81').
9. See, e.g., R. Gilbert, Converging Doctrines US and EU Antitrust Policy for the Licensing of Intellectual Property, University of California, Berkeley, Competition Policy Working Paper No. CPC04-44,http://papers.ssrn.com/sol3/ papers.cfmabstract_id=527762
10. P. Lowe, L. Peeperkorn, Singing in Tune with Competition and Innovation: The New EU Competition Policy Towards Licensing 26
11. Fordham Corporate Law Institute Thirty-first Annual Conference on International Antitrust Law & Policy (October 2004, 'The new TTBER and Guidelines bring about an important degree of convergence between EU and US competition policy towards licensing agreements.').
12. Draft Commission Regulation on the Application of Article 81(3) of the Treaty to Categories of Technology Transfer Agreements, 2003 OJ (C 235) 11 [hereinafter Draft TTBER]
13. Draft Guidelines on the Application of Article 81 of the EC Treaty to Technology Transfer Agreements, 2003 OJ (C 235) 17 [hereinafter Draft Guidelines].
14. My focus is actually even narrower, focusing on three of the particular changes adopted by the Commission. For a more comprehensive review of the changes, see E. Vollebregt, 'The Changes in the New Technology Transfer Block Exemption Compared to the Draft', 25 ECLR (2004), p. 660.
15. See infra text accompanying notes 14, 44, and 49.
16. See, e.g., Joint Comments of the American Bar Association's Section of Antitrust Law, Section of Business Law, Section of International Law and Practice and Section of Intellectual Property Law on Draft Commission Regulation on the Application of Article 81(3) of the EC Treaty to Categories of Technology Transfer Agreements and Draft Commission Notice on Guidelines on the Application of Article 81 to Technology Transfer Agreements 23 ('The Sections wish to point out that the treatment of vertical nonprice restrictions as hardcore infringements, albeit with enumerated exceptions, differs from the treatment of these license terms under US law, where a showing of adverse competitive effects is necessary for the condemnation of these terms.'), available at http://europa.eu.int/comm/competition/antitrust/technology_ transfer_2/15_aba_part2_en.pdf
17. Draft TTBER, art. 1(h). 12 See, e.g., Pharmaceutical Research and Manufacturers of America, Comments on Proposed Changes to EU Technology Transfer Block Exemption Regulation 4, available at http://europa.eu.int/comm/competition/antitrust/technology_transfer_ 2/29_pharmaresearch_part2_en.pdf
18. GlaxoSmithKline Comments on the Draft Commission Regulation on the Application of Article 81(3) to Technology Transfer Agreements ('TTBER') 3,http://europa.eu.int/comm/competition/ antitrust/technology_transfer_2/13_glaxo_en.pdf
19. Monti TTBER Revision Speech.
20. Final TTBER, art. 4(3).
21. US Department of Justice & Federal Trade Commission, Antitrust Guidelines for the Licensing of Intellectual Property 4.3 (April 6, 1995) 4 Trade Reg. Rep. (CCH) 13.132.
22. GlaxoSmithKline Comments, at 3.
23. Final TTBER, art. 4(1)©.
24. Final TTBER, art. 4(2)(b).
25. See Final TTBER art. 5(2).
26. Federal Trade Commission & US Department of Justice, Antitrust Guidelines for Collaborations Among Competitors 2.4 (2000).
27. Draft TTBER, art. 4©. Article 4© actually declared to be a hardcore restriction 'the allocation of markets or customers', and did not refer to field-of-use restrictions explicitly. But article 4©(i) stated that non-reciprocal field-of-use restrictions were not to be included in that category, indicating that reciprocal field-of-use restrictions were within article 4©.
28. Monti TTBER Revision Speech.
29. Cutter Laboratories, Inc. v. Lyophile-Cryochem Corp., 179 F.2d 80, 92 (9th Cir. 1949)
30. Racal/Decca, OJ L43/27 (1989)).
31. Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700, 708 (Fed. Cir. 1992).
32. Charles River Associates Ltd., Report on Multiparty Licensing (22 April 2003, available at http://europe.eu.int/comm/competition/antitrust/legislation/multiparty_ licensing
33. (Proposing that cross-licenses be permissible only when they are of complementary technologies, involve zero royalties, or are for future technologies and satisfy certain other criteria).
34. Monti TTBER Revision Speech.
35. W. M. Cohen et al., Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (or Not), NBER Working Paper7552 (February 2000)
36. B. H. Hall, R. M. Ham, The Patent Paradox Revisited: Determinants of Patenting in the U.S. Semiconductor Industry, 1980-94, NBER Working Paper No. 7062 (May 1999
37. A. Jaffe, The U.S. Patent System in Transition: Policy Innovation and the Innovation Process, NBER Working Paper 7280, http://www.nber.org/papers/w7280
38. Interestingly, several of these articles have been cited by Luc Peeperkorn, who was one of the Commission officials responsible for the TTBER. See Peeperkorn, IP Licenses and Competition Rules: Striking the Right Balance 3-4, Ecole des Mines, Paris, 15-16 January 2004.
39. S. M. Maurer, S. Scotchmer, Profit Neutrality in Licensing: The Boundary Between Antitrust Law and Patent Law, NBER Working Paper 10546 (June 2004
40. Monti TTBER Revision Speech.
41. see also R. Gilbert, Converging Doctrines: US and EU Antitrust Policy for the Licensing of Intellectual Property, Competition Policy Center Working Paper No. CPC04-44, University of California, Berkeley (2004) ('Including these restrictions in the hardcore list could be an acceptable compromise if the Commission were prepared to act flexibly to consider individual transactions and exempt hardcore restrictions when there are clear benefits.').
42. The differences discussed here relate to the basic nature of the US guidelines. There are also specific differences, such as the provision in the US Guidelines note that the applicability of the 'safety zone' may change over time. This presumably means that if the market shares of the parties increase, their license may come under scrutiny, even if the parties' shares were small when they entered into the license agreement.
43. US IP Guidelines 5.5.
44. See M. R. Patterson, 'The Role of Power in the Rule of Reason', 68 Antitrust LJ (2000), p. 429.
45. Commission Regulation (EC) No 240/96 of 31 January 1996 on the application of Article 85(3) of the Treaty to certain categories of technology transfer agreements, OJ L 31/2 (1996), art. 4.
46. Monti TTBER Revision Speech.
47. See F. Fine, New EU Rules for Technology Licensing: A Kinder Gentler Straitjacket, PLI Tenth Annual Institute for Intellectual Property Law (Sept. 2004)
48. Pfizer Inc., Comments on Draft Commission Regulation on the Application of Article 81(3) to Categories of Technology Transfer Agreements and the Draft Commission Notice on Guidelines on the Application of Article 81 to Technology Transfer Agreements, available at http://europa.eu.int/comm/competition/antitrust/technology_ transfer_2/2_pfizer_en.pdf
49. Commission Notice on agreements of minor importance which do not appreciably restrict competition under Article 81(1) of the Treaty establishing the European Community (de minimis), OJ C 368/07 (2001).
50. See, e.g., Coudert Brothers, Pitfalls in Intellectual Property Licensing in the European Union, http://library.lp.findlaw.com/articles/file/00324/002645/title/Subject/ topic/Antitrust%20and%20Trade%20Regulation_Vertical%20Restraints/filename/anti trustandtraderegulation_2_247 (1999)
51. Monti TTBER Revision Speech.