EU takes China to WTO over tech patent royalties
By Frank Prenesti
Date: Monday 20 Jan 2025
(Sharecast News) - The European Commission has filed a complaint with the World Trade Organisation against China over its "unfair and illegal trade practices" in setting worldwide royalty rates for EU standard essential patents without the patent owner's consent.
It added that the practice "pressures innovative European high-tech companies into lowering their rates on a worldwide basis, thus giving Chinese manufacturers cheaper access to those European technologies unfairly".
The case concerns standard essential patents, which protect technologies essential for the manufacture goods that meet a standard - for example 5G for mobile phones, the commission added in a statement.
"European companies hold many such high-tech patents, notably in the telecom sector, which give them a technological edge. By fixing worldwide royalty rates for such patents, China attempted to force EU companies to give Chinese manufacturers cheaper access to that European technology."
The commission has requested consultations with China, the first step in WTO dispute settlement. If the matter is not resolved within 60 days, it can ask for an adjudicating panel be established.
The case is also connected to a separate dispute the EU brought to the WTO in 2022 related to Chinese anti-suit injunctions, which effectively restrain high-tech patent holders by fining or sanctioning them if they seek to enforce their intellectual property rights through a non-Chinese court.
That panel is expected to report in the first quarter of this year.
Reporting by Frank Prenesti for Sharecast.com
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