EU in Consultations
with China at WTO over Patent Licensing Measures
·
Chinese
Courts have First and Last Decisions on SEPs
The
European Union has requested WTO dispute consultations with China in regard to
Chinese measures concerning patent licensing terms. The request was circulated
to WTO members on 22 January.
The
EU argues Chinese courts have, under Chinese law, the authority to determine,
without the consent of both parties, binding worldwide licensing conditions,
and in particular royalty rates, for portfolios of standard essential patents
(SEPs), including non-Chinese SEPs.
The
EU claims these provisions are inconsistent with various provisions under the
WTO's Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).
This
new request for consultations is related to the dispute initiated by the EU in
“China — Enforcement of intellectual property rights” (DS611).
What
is a request for consultations?
The
request for consultations formally initiates a dispute in the WTO.
Consultations give the parties an opportunity to discuss the matter and to find
a satisfactory solution without proceeding further with litigation. After 60
days, if consultations have failed to resolve the dispute, the complainant may
request adjudication by a panel.