Global Competition for FRAND royalty setting

Standard essential patents (SEPs) and licensing on fair, reasonable and non-discriminatory (FRAND) terms have ceased to be a private matter between holders and implementers to become a legal, economic and geopolitical phenomenon of the first order. This paper proposes four factors that explain the significance and orientation of SEP disputes, the national-industry factor, the geopolitical factor, the architectural factor and the factor of the internal balance between holders and implementers, and uses them as a framework for reading jurisdictional competition in FRAND matters. After characterising the types of implementers and holders and the different meanings of the FRAND commitment, the article analyses two salient manifestations of an emerging global governance: the judicial setting of global royalties and anti-suit injunctions. A comparative examination of the United States, the United Kingdom, Germany and China, together with the WTO DS611 dispute, reveals a structural tension between the territoriality of the patent and the international vocation of the standard, as well as the risk of court-imposed compulsory licences.