Nokia says draft EU patent rules one-sided, will undermine Europe

The comments from the Finnish telecoms equipment maker, which makes 40% of its revenues from its portfolio of standard essential patents (SEPs), come two days before the European Commission is scheduled to present the draft rules.

Under the proposal, patent holders are required to register their patents with the EU Intellectual Property Office (EUIPO) if they want to charge patent fees or take legal action.

EUIPO will also oversee the process to determine fair, reasonable and non-discriminatory (FRAND) royalties, which should be concluded within nine months.

The proposal is unbalanced and ignores a key problem for patent owners, said Nokia’s head of IP policy Collette Rawnsley.

“The leaked draft regulation appears one-sided with additional obligations, burdens and costs falling on SEP owners rather than implementers,” she said. “Unfortunately, there is nothing in the proposal to address the issue of hold-out, where bad faith implementers avoid or delay taking a licence and paying for innovative technology that they are using.”

She said Europe, currently home to leaders in cellular standards, could even lose its lead under the draft rules. “EU regulatory intervention and changes to the framework for SEP licensing risk making European forums for standardisation less attractive. This risks undermining European leadership in these critical technologies,” Rawnsley said.

She dismissed regulator’s concerns of patent spats which in the previous decade involved Apple, Samsung, Nokia, Microsoft and others.

“The majority of patent licensing agreements are agreed amicably. Litigation is rare and always a last resort. Regrettably, litigation is sometimes necessary to get recalcitrant implementers to the table to negotiate in good faith a FRAND licence,” she said.