This document discusses antitrust issues related to technology transfer licensing agreements. It notes that licensing is necessary for cumulative, sequential, and complementary innovation. However, licensing restrictions like sales limitations, tying, exclusive grants, and excessive royalties can raise antitrust concerns. The document examines exclusive licensing and royalty obligations under antitrust laws and outlines factors like market power and competitive effects that determine antitrust assessments. It also provides the analytical framework for evaluating IP licensing practices under the Indian Competition Act and summarizes key cases addressing issues like software restrictions and standard-essential patents. The conclusion advocates a case-by-case approach balancing competition and innovation incentives.

1. TECHNOLOGY TRANSFER LICENSING
AGREEMENTS : ANTITRUST ISSUES
Gauri Chaturvedi
L.L.B. , 3RD Year
Faculty of Law
Delhi University

2. INNOVATION
INCENTIVE-ACCESS
INNOVATIONIncentive Access
IPR
Growth, efficiency, consumer welfare
Antitrust

3. NEED FOR IP LICENSING
Cumulative/sequential
innovation
• Each discovery builds on
previous discoveries
• Subsequent innovation may
require access to earlier
patented innovation(s)
Complementary/
simultaneous Innovation
• Multiple complementary patented
technology/innovation may be
necessary for a complete solution
or to produce a downstream
product (system)
Licensing of IP/ Technology transfer

4. RESTRICTIONS IN LICENSING
AGREEMENTS
• Sales restriction
• Tying
• Exclusive grant backs
• Exclusive licensing
• Royalty obligations

5. EXCLUSIVE LICENSING : ANTITRUST
ASSESSMENT
• Exclusive licensing in general
• Exclusive licensing under Article 101
TFEU |
• Exclusive licenses under Section 1
Sherman Act

6. ROYALTIES: ANTITRUST ASSESSMENT
• Royalty obligations –
- discriminatory
- excessive
- beyond the period of IPR

7. KEY POINTS OF DETERMINATION
• Are the parties competitors or potential competitors?
- helps establish the intent
• Does the licensor have market power?
- IP owner does not necessarily have market power
• What is the anti-competitive harm?
- impact on innovation
• What are the pro-competitive benefits?
- business/objective justification

8. The Indian Context
Conduct Applicable provisions
of the Competition Act,
2002
Analytical Framework
IP licensing
practices
Section 3(4)/
Section 4
No antitrust immunity under
Section 3(5) – exemption only
to imposition of ‘reasonable
conditions’
Case by case assessment of
reasonableness of licensing
terms/conditions

9. Cases in India
Case IP related issue Status /Decision
FSS Pvt. Ltd vs. ACI
Worldline Solutions
Pvt. Ltd
Restriction in
Customization and
modification of
copyright protected
primary software
Final Order passed
No contravention
found
ATOS Worldline India
Pvt. Ltd vs. Verifone
India Sales Pvt. Ltd.
Licensing of software
development kit
Order passed u/s 27
of the Act
Micromax Informatics,
Intex Technology vs.
Ericsson
SEP, F/RAND Prima facie order
u/s 26(1) of the Act

10. CONCLUSION
• Case – by-case rule of reason approach
• Framework similar to vertical agreements with
the additional factor of ‘impact on innovation’
• Carefully tailored remedies to preserve
competition and incentives to innovate

11. THANK YOU