Seminar  |  10/30/2018 | 12:00 PM  –  01:30 PM

Brown Bag Seminar: Do the Rules Play the Game? SEP License Negotiations Under Evolving Regulation

Justine Bulkaert (Université de Liège)

Max Planck Institute for Innovation and Competition, Munich, Room 313

The goal of this paper is to analyze whether the policy changes that have occurred in the European SEP licensing regulation affect the way agents negotiate SEP licenses with each other. In fact, the European SEP licensing regulation landscape has gone through three major policy changes since 2009: the Orange book standard (only Germany), the Samsung/Motorola decisions (EU-wide) and the Huawei v. ZTE judgement (EU-wide). Even though these reforms sought the same objective – namely sustaining innovation, healthy competition and protecting consumers from monopoly power – their means are, to some extent, quite divergent. Whilst the first policy change established rather strict conditions on the patent implementers, the second one reversed the situation completely, providing a safe harbour to patent users. In an attempt to clarify the issues raised by such a drastic reversal, the third policy change attempts to reach a balance between the previous two regulations, in order to provide a fair environment to the contracting parties.

We apply a simple Nash bargaining environment to SEP license negotiations in order to study how the changing institutions affect the outcome of such negotiations. By parameterizing policy changes, we are able to see how these alter the disagreement points of the negotiation game and, potentially, define the feasible bargaining range of successful negotiations.

Contact: Dr. Fabian Gaessler