This paper analyses the reframing of German seed as a market good. In the late nineteenth century, seed was sold on dedicated transregional markets for the first time. These emerging seed markets f...

Holding on to and letting go of seed: quasi-commodities and the passage of property

Ten years of effects: based approach in EU competition law

The Swedish Network for European Legal Studies is happy to announce the third volume in this series of annual publications which acts as a forum for the publication of studies on European law by Swedish scholars. The annual this year focuses on competition aspects of Intellectual property law, and contains peer-reviewed articles aimed at 
spreading Swedish legal research on European law to a wide international audience. The articles in the volume are concerned with European law, its development, impact and reform. Furthermore they are original, analytical contributions to doctrinal debates and questions, by legal researchers mainly, but not exclusively, connected with the Swedish universities.

National Developments in the Intersection of IPR and Competition Law From Maglite to Pirate Bay

Post-sale restrictions in patent and trademark licensing agreements and their validity and compliance with competition law emphasize the problematic to what extent the intellectual property holder may enforce its IP rights. In today’s innovative markets, licensing is a one form of how the IP holder may exploit its IPR and obtain revenues. Post-sale restrictions are part of the scope of the license, when the IP holder grants a right to, for instance, single-use of the IP protected product or part of it. The IP holder may also aim to prohibit the use of another supplier’s products in relation to its main product. In other words, a prohibition to reuse the spare part may be imposed.

Post-sale restrictions as a licensing practice raise several legal questions, which are examined in the thesis, such as whether such restrictions are valid and in compliance with competition law. Ultimately, the discussion concerns the interaction between IP and competition law and which assessment should prevail. Comparative aspects are also considered by contrasting the EU approach with the U.S. one.

From the perspective of validity under patent and trademark laws, the application of the exhaustion doctrine is an essential parameter to be considered. The exhaustion may be limited either by justifications under patent law or alterations limitations under trademark law. Licensing may be also considered as a limitation for the exhaustion doctrine, however, with reservations. Post-sale restrictions in licensing agreements under patent or trademark law can be said being generally valid, when within the scope of patent or trademark protection. The consent of the IP holder is the key
element in order to determine validity. However, post-sale restrictions may not interfere with other areas of law such as competition law or internal market freedoms.

Considering the more flexible protection of trademark licensing with post-sale restriction compared to patent one, a shift from patent licensing can be considered as a possible solution. It is suggested that the most beneficial option would be a hybrid license benefiting from both types of protection. Ultimately, the use of post-sale restriction in licensing is a strategic decision of companies, which requires allocation of risks, especially given the possible competition law scrutiny.

From the perspective of competition law, the validity of post-sale restrictions under patent or trademark laws cannot be considered as a presumption of compliance with competition law. Regardless the validity, such conduct could constitute an abuse of dominant position in the form of tying or abuse of procedure. Even though a dominant company has a legal
right to exploit its IPRs under patent or trademark law, such exploitation must not be excessive resulting in anti-competitive disclosure of neither the primary nor the aftermarket by misusing its IP as tying. Neither any abuse of procedure is accepted. In this context, a theory of harm is an essential consideration in assessing the competitive effects of post-sale restrictions.

At a policy level, competition law is not generally subordinate to IP laws, even in the case of valid restrictions under IP laws. However, in the case of parallel proceedings, competition law may exceptionally be subordinate to IP laws when the competition law assessment may be dependent on the outcome of the IP procedure as far as the scope of IP is concerned. For the sake of clarity, good faith infringement procedures resulting in a res judicata decision should be followed in the competition law assessment. Considering the ideal balance between competition and IP law assessment,
such assessments should be complementary with each other. However, for expediency reasons, in certain cases, competition law scrutiny may not be conducted simultaneously before the scope of IP has been considered under
IP laws.

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Pauliina Sutinen

Papers

Post-sale restrictions in patent and trademark licensing agreements: Validity and compliance with competition law