SEP licensing guidelines

Advice published for Internet of Things roll-out

The App Association and the Fair Standards Alliance (FSA), in conjunction with the Deutsches Institut für Normung, has published a set of guidelines on the licensing of standard essential patents. The SEP licensing guidelines could act as a blueprint for companies during the global expansion of the Internet of Things technology.

12 June 2019 by Amy Sandys

The App Association (ACT) and the Fair Standards Alliance (FSA) has published a set of guidelines concerning the licensing of SEPs ©Vitaly/ADOBE STOCK

The SEP licensing guidelines is the result of an 18-month long collaborative effort between The App Association (ACT) and the FSA. Entitled ‘Core Principles and Approaches for SEP Licensing,’ the resulting 51-page document uses input from 56 organisations.

The SEP licensing guidelines outline six principles. These should be considered by companies, say ACT, when considering if SEP licensing terms are FRAND. The guidelines may also contribute to a FRAND licensing outcome in the litigation process.

A set of guidelines further explain the core six principles set out by ACT and the FSA. They include injunctions, licence availability, court FRAND methodologies, patent bundling, non-disclosure agreements and fairness, and the transfer of patents.

The association hopes the guidelines will streamline the applicability of SEP licensing. It also wants to make it easier for companies of all sizes to obtain patents essential to IoT standards. Given the increased global roll-out of IoT technology and 5G, this is particularly pertinent.

Helping hand

The 56 signatories come from a variety of industries. The App Association says this diversity is reflective of the diverse application of 5G technology. Small- and medium-sized enterprises (SMEs) are often left behind in the field of patent litigation, say the ACT. Some businesses of this size have also contributed to the guidelines.

Mike Sax, founder and chairperson of the ACT says, “The FRAND promise lies at the heart of the SEP licensing process.”

There is speculation that it will be more difficult for small businesses to innovate in the IoT environment. This is because some feel that SEP licensing practices are not SME-friendly. The ACT feels this is slowing down the adoption of new technologies in Europe, both for consumers and businesses.

In Europe, SEP licensing on FRAND terms is growing as a contentious issue in patent litigation. Last year saw the UK Court of Appeal uphold a High Court decision by Colin Birss to set a global licence for FRAND in the Unwired Planet vs. Huawei case. The case will go to the Supreme Court in October of this year.

The full set of guidelines drafted by ACT and the FSA can be found here.