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TRANSFER OF
TECHNOLOGY BLOCK
EXEMPTION REGULATION
NO. 240/96 AND ITS
PROPOSAL TO REFORM
24 June 2003
Valeria Falce ([email protected])
Gianni, Origoni, Grippo & Partners
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OUTLINE
•
EU Competition Law - Overview of current system
and Modernisation Reform
•
Technology Transfer Regulation No. 240/96 Current
•
Proposed Reform
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EU Competition Law
Overview of current system (1)
•
Art. 81(1) prohibits “agreements between
undertakings … which may affect trade between
Member States and which have as their object or
effect the prevention, restriction or distortion of
competition within the common market”
•
Art. 81(3): the prohibition may “be declared
inapplicable …”
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EU Competition Law
Overview of current system (2)
•
Art. 81(3) criteria for exemption: all four conditions
must be satisfied:
–improve production, distribution, technical or
economic progress
–fair share of benefit to consumers
–restrictions: minimum necessary
–no elimination of competition
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EU Competition Law
Overview of current system (3)
•
Art. 81 implemented by Regulation 17/62
“The Commission shall have sole power to declare
Article 81(1) inapplicable”
Commission has exercised its power by issuing:
Notices (e.g. de minimis agreements)
Block exemptions
Individual exemptions or “comfort letters”
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EU Competition Law
Overview of current system (4)
•
The problems:
–Commission over-burdened
–Notification is “excessive burden on industry”
–Notification does not work
•
The solution: Modernisation – Reg. 1/2003
-Notifications Art. 81(3) no longer possible
-Commission monopoly Art. 81(3) disappears
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THE AIM OF REG. 240/96
•
TO SIMPLIFY THE RULES GOVERNING LICENSING
AGREEMENTS
•
TO ENSURE EFFECTIVE COMPETITION IN
TECHNOLOGICALLY NEW OR IMPROVED
PRODUCTS
•
TO CREATE A FAVOURABLE LEGAL
ENVIRONMENT FOR COMPANIES
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FORMAL REQUIREMENTS UNDER REG. 240/96
•
THE REG. 240/96 APPLIES TO SPECIFIC TYPES OF
AGREEMENTS ONLY (PATENTS AND KNOW-HOW)
•
THE REG. 240/96 ASSUMES THAT ANY
RESTRICTIONS OVERSTEPPING THE
BOUNDARIES OF THE PATENT SCOPE IS
POTENTIALLY IN VIOLATION OF ART. 81
•
THE REG. 240/96 SETS OUT 3 CATEGORIES OF
CLAUSES (WHITE CLAUSES; BLACK CLAUSES;
GREY AREA CLAUSES)
•
THE REG. 240/96 ALLOWS THE COMMISSION TO
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AMBIT OF APPLICATION OF REG. 240/96 (1)
•
EXCLUSIVE LICENSING AGREEMENTS BETWEEN
TWO PARTIES ONLY
→
Pure or mixed patent and Know-how licenses
→
Other IPRs are covered to the extent that such
additional licensing contains only ancillary
provisions
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AMBIT OF APPLICATION OF REG. 240/96 (2)
•
CERTAIN EXCLUSIVE LICENSES AGREEMENTS
ONLY
-
Where the licensor undertakes
→
→
NOT to appoint other licensees and/or
NOT to exploit the licensed technology in the
territories reserved to the licensor (Articles 1.1 (1),
1.1 (2) and 1.1 (3))
→
Where the licensee is protected against
active/passive sales from licensees established in
other territories (Articles 1.1 (4), 1.1 (5) and 1.1 (6))
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THE COMMISSION
EVALUATION REPORT
(December 2001
Consultation 2002)
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THE SCOPE OF THE PROPOSAL
•
TO GET RID OF FORMALISM, COMPLEXITY AND
NARROWNESS OF SCOPE
•
TO CONFORM REG. 240/96 TO OTHER BLOCK
EXEMPTION REGUILATIONS
•
TO SUFFICIENTLY RECOGNISE INTERBRAND
COMPETITION AND COMPETITION BETWEEN
LICENSORS AND LICENSEES
•
TO PROVIDE FOR LEGAL CERTAINTY AND EASE
OF APPLICATION
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HOW TO REACH THE END (1)
1.
To extend the application of Reg. 240/96 to:
•
Other types of IP rights: copyright, design rights and
trademarks also when not ancillary to patent and knowhow licenses
•
Multiparty agreements and licensing pools: such
arrangements are likely to be pro-competitive between
non-competitors, especially when they relate only to
essential intellectual property rights
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HOW TO REACH THE END (2)
2.
To reconsider the threshold test in relation to JVs:
•
Reg. 240/96 applies to licenses between competitors
that holds interests in a bilateral joint venture
provided that they have:
-
less than a 20% market share (production only)
10% market share ( distribution included)
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HOW TO REACH THE END (3)
3. To distinguish between relationships between
competitors and relationships between noncompetitors
4. To apply different market shares tresholds to:
-
Different relationship
Different restrictions
5. To abolish the opposition procedure