Institute News

What direction is the European Union's innovation policy going in? Can legislative proposals such as the Digital Markets Act (DMA) make Europe fit for the digital age? Is the European IP framework still suitable to fulfil its fundamental functions in view of technological disruption? These were the questions addressed at this year's Alumni Conference, which was hosted on 9 July for the 17^th time by the Institute in collaboration with the Alumni Association “Friends and Former Employees of the Max Planck Institute for Innovation and Competition”. 
 

Due to the ongoing Covid-19 pandemic, for the first time the event took place online. Researchers and Alumni of the Institute as well as external guests from all over the world engaged in fruitful discussions on the current and future European law and policy framework for innovation and competition in digital markets. The conference was opened by welcome addresses of the chairwoman of the Alumni Association, Federica Togo, and the Managing Director of the Institute, Josef Drexl.

The European Union's Competition Policy
 

The first panel dealt with the competition policy of the European Union and was chaired by Dietmar Harhoff, Director of the Institute’s economic department. Cristina Caffarra, Senior Consultant to Charles River Associates and Visiting Professor at University College London, started by providing a critical look at the current competitive landscape and competition law enforcement within the digital world. In her keynote, she raised major concerns regarding, inter alia, structural underenforcement coupled with insufficient regulation, which also fails to properly address privacy concerns. The talk contained a critical look at the proposal for a Digital Markets Act (DMA) and further legislative action in the UK, the US, and Germany, and questioned whether the current regulatory environment helps to foster innovation.
 

In the second keynote of the first panel Rupprecht Podszun, Chair for Civil Law, German and European Competition Law and Director of the Institute for Competition Law at the University of Düsseldorf, spoke about “Taking Decisions on Regulating Big Tech”. He argued for a principled approach that should be followed by policymakers enforcing competition law vis-à-vis Big Tech companies. The presentation focused, inter alia, on the question where such principles come from (e.g. constitutional documents) and on the relationship between competition law and fundamental rights issues, such as personal data protection, sustainability or the protection of consumer autonomy. Within his keynote he discussed different ways of intervention against the backdrop of different market models.
 

The discussion after the first panel focused, for example, on the question which goals the proposed DMA pursues (if any). It was also discussed how a competition policy can be justified that aims at providing consumers with more sovereignty and choice in order to protect competition, but at the same time cuts down the users’ convenience by regulating the conduct of Big Tech companies.

The IP Policy of the EU

The second panel, chaired by Reto M. Hilty, Director at the legal department of the Institute, was devoted to the EU’s IP policy. Katharine Rockett, Professor at the University of Essex, started by laying the economic groundwork on intellectual property protection for data and Artificial Intelligence. She first elaborated on the general preconditions under which IP rights for data may be justified and put a special emphasis on issues of licensing and diffusion. After having illustrated the distinguishing features of data compared to more traditional subject matter for intellectual property protection and the implications of these features for intellectual property design, she made some final remarks on how Artificial Intelligence might alter traditional IP paradigms.
 

Building on this economic foundation, Matthias Leistner, Chair of Private Law and Intellectual Property Law with Information and IT-Law at the University of Munich, gave an overview on both the current IP landscape of the EU and upcoming IP policy reforms from a legal point of view. Against the backdrop of a newly-evolving overall access and portability paradigm in EU law making, he critically examined the protection of database works de lege lata under copyright law, the sui generis right for databases, and trade secrecy rules. He particularly pointed out the need for abolishment or at least substantial reform of the database sui generis right. Leistner then gave an outlook on how the European Commission plans to address this and other existing problems in the course of its upcoming Data Act.
 

The following lively discussion revolved around, inter alia, the problem of over-complex and overlapping regulatory levels to the detriment of small market players, the possibility of introducing new registration systems for as of yet unregistered IP rights, and the advantages of a more unfair competition law oriented approach towards the protection of databases.

For the third time now, the two-day event was organized by Ph.D. students and Postdocs of the Department for Innovation and Entrepreneurship Research to give young scholars the opportunity to present and discuss their work.

On the first day, the workshop was kicked off with a session on Intellectual Property Rights, followed by sessions on Science of Science and Individuals in the Knowledge Economy. Speakers presented research findings related to the strategic drafting of patents, trademark enforcement and counterfeiting, the effect of government funding on follow-on innovation, and voluntary employee representation and its effects on innovation. The final presentation of the day shed light on the gender innovation gap by analyzing gender differential responses to early patent rejections.

The highlight of the first day was the keynote speech by Rosemarie Ziedonis and Sina Khoshoskhan who presented results on “Forty Years of Research on Intellectual Property and Innovation: Dominant Themes and New Horizons”. An interactive discussion emerged on what makes a scientific paper interesting, stand the test of time, and be considered at the frontier of its field.

The second day offered interesting insights on Firms and Innovation, Takeovers and Investment, as well as AI and Innovation. Young scholars presented research on the global innovation strategies of multinational firms, the impact of common ownership on markups, the innovation effects of killer acquisitions, and the effect of angel investments on corporate innovation. In the last session, the researchers focused on who is shaping AI given the differential access to computing power, and on the barriers to growth firms encounter in developing AI.

See the complete program with all topics here and find the coverage on Twitter under #RISE3Workshop.

The RISE workshop series aims at stimulating a rigorous in-depth discussion of a selected number of research papers by Ph.D. students and Junior Postdocs, providing feedback and connecting with peers from other research institutions. Accordingly, the workshop brings together young researchers from all over Europe and the US with researchers from the Munich Innovation Community.

We thank all participants, including the keynote speakers, discussants and presenters for a truly outstanding RISE3 Workshop 2020. Our special thanks go to the organizing team, especially to Cristina Rujan, Timm Opitz, Kathrin Wernsdorf, and Felix Poege. With great enthusiasm and motivation, we look forward to the RISE4 Workshop 2021 ‒ then hopefully again in person at the Max Planck Institute for Innovation and Competition in Munich.

Notwithstanding the difficulties brought about by the Covid-19 pandemic, the European Joint Doctorate project of the EIPIN (European Intellectual Property Institutes Network) Innovation Society remains committed to pursuing its main objective: supporting high-quality doctoral research on the role of intellectual property (IP) as a complex adaptive system in innovation. At the online conference “Fostering Innovation in Europe - Intellectual Property Policies and Law” on 25 June all 14 Early Stage Researchers (ESRs) who are currently finalising their doctoral theses had the opportunity to present their research outcomes. In organising the event, EIPIN built on the active support of the Partner Organisation European Union Intellectual Property Office (EUIPO) in Alicante. The Office also acted as the official host of the conference.

As the Max Planck Institute for Innovation and Competition is a supporting institution of the EIPIN Innovation Society project, four representatives of the Institute actively took part in the event. Professor Josef Drexl, Managing Director at the Institute, moderated the Panel “Intellectual Property as a Complex Adaptive System” (Panel 1). Together with the ESRs, he discussed the relationship between IP rights and innovation stressing the tension between IP reward and access as the true innovation driver even in the foremost technological fields such as Artificial Intelligence. Furthermore, the three ESRs Niccolò Galli, Vicente Zafrilla Diaz-Marta and Letizia Tomada, whose doctoral theses are primarily supervised within the Institute, presented their research results during the conference.

The research results at a glance

During Panel 1 Niccolò Galli highlighted his research findings on the interplay between patent aggregation, innovation and EU competition law. Abandoning pejorative monikers such as patent trolling, he advocated for a conduct-based redefinition of patent aggregation as the building of ICT patent portfolios for subsequent non-manufacturing use. Based on such a redefinition he advanced an analytical framework to assess the possible innovation effects of patent aggregation activities within competition law analysis.

During the Panel “Governance of Production and Technologies” (Panel 2), Vicente Zafrilla Diaz-Marta focused his presentation on a very specific – and workable – proposal to prevent over- and underdisclosure of standard essential patents (SEPs) in the framework of standard developing organisations. His proposal builds on the aims of the disclosure system – primarily to ensure access of new market participants and secondarily to inform implementers for licencing purposes. It balances the incentives and dynamics that might encourage SEP holders to an under- or overdeclare SEPs or dissuade them from engaging in such behaviour.

During the Panel “Adjudication, Justice and Enforcement” (Panel 3), Letizia Tomada presented a part of her research findings concerning the implications of the establishment of the Unified Patent Court (UPC) for innovation of start-ups. She analysed certain UPC features that tend to favour strong established businesses over more financially constrained start-ups. The discussion focused on the lack of proximity to the litigation venue and the territorial scope of jurisdiction. Lastly, her presentation envisaged changes to the UPC Agreement to mitigate the existing imbalances.

Further information on the doctoral programme is available at the EIPIN-Innovation Society website.

This project has received funding from the European Union's Horizon 2020 research and innovation programme under the Marie Skłodowska-Curie grant agreement no 721 733.

The workshop was originally launched in Turin, but is now also held at other major research locations such as the Centre for Research on Entrepreneurship and Innovation at the University of Bath (2018) and the GREThA at the Université de Bordeaux-CNRS (2019).

Due to the current pandemic situation, the event, which was initially planned for the end of April, now took place very successfully in online format for the first time. The participants were welcomed by Michael E. Rose, Senior Research Fellow in the department Innovation and Entrepreneurship Research, and co-organizer Hanna Hottenrott, Professor of Economics of Innovation at the Technical University of Munich.

The 12 presentations in six sessions over two days were very well received by up to 70 participants. The afternoon sessions were particularly well attended, since, due to the time difference, researchers from the US were also able to zoom in. In addition to the presentations, virtual breakout rooms were hosted which allowed the researchers to make new contacts with other scientists for the first time in a long while.

The topics at a glance

The first session started by focusing on the question "How Scientists Search". The presenter showed how the search for antibodies can be biased by the ranking of search results. The second presentation discussed how novelty and impact of scientific articles in physics are related to team size.

The second session dealt with topics in the field of academic training. In Session 3, the first day of the workshop concluded with investigations on how scientists react to the sudden loss of research resources.

The second day opened with two presentations on questions of informal cooperation in economics. Session 5 focused on science funding: Both theoretical and empirical research findings on the optimal design of science funding programs were presented.

In the final workshop session, the presenters stressed, on the one hand, the importance of coherence and alignment with one’s previous research in order to obtain funding, as well as, on the other hand, that humor and curiosity are more important as drivers of path-breaking science than research awards.

See the complete program with all topics here.

More information on the workshop website and further impressions on Twitter under #woepsr2020.

We thank all organizing parties involved as well as all participants, speakers and discussants for a truly exceptional and inspiring workshop and look forward to WOEPSR 2021. The Max Planck Institute for Innovation and Competition will host the workshop again within the next two years and hopes to welcome the participants on site then.

Geographical Indications (GIs) are designations for products from a geographical area that owe their quality or reputation to their geographical origin. In the European Union, they are protected as Intellectual Property rights by an independent legal system. Since they are also an instrument of agricultural policy to promote production and living conditions in rural areas, there are many differences with other fields of IP rights. Specificities also arise from the fact that the first and often most important phase of the granting of rights takes place before national authorities, whereby national traditions and idiosyncrasies could impair the desired uniformity of protection.

Since there has been little legal research on GIs - despite increased attention to the subject from politics and the economy - the Max Planck Institute for Innovation and Competition launched a research project at the beginning of last year to analyze the GI system within the EU and beyond. On 13 and 14 February, the Institute hosted a workshop on GIs in which international experts from academia and practice, as well as representatives of authorities from the EU and some member states, took part. During the workshop, the Institute's researchers were able to present their preliminary research results and discuss with the participants.

Geographical Indications in the EU

To start the workshop, project coordinator Andrea Zappalaglio explained the aims and structure of the project; he presented the results of the evaluation and empirical analysis of the protection parameters summarized in the specifications for GIs registered in the EU database DOOR (Database of Origin & Registration). In this database, managed by the EU Commission, all registered agricultural products and foodstuffs are published.

Afterwards, representatives of the EU Commission provided insights into the work and plans of the new Commission. Francis Fay, head of the unit responsible for GIs in the Directorate-General for Agriculture and Rural Development (DG Agri), and Valerie Dufour from DG Agri explained the Commission's current audit practice and the EU policy on GIs and discussed with the participants the challenges and options for optimizing the system. Marie D'Avigneau and Malwina Mejer from the Directorate-General for the Internal Market, Industry, Entrepreneurship and SMEs (DG Grow) reported on the status of work on creating protection of GIs for non-agricultural products.

On the second day of the workshop, the Max Planck research team first presented the preliminary results of a comparative analysis of the national procedures under which GI applications are examined in the member states. Alexander von Mühlendahl, lawyer at the Munich law firm Bardehle Pagenberg and Visiting Professor at Queen Mary University in London, and Elisa Zaera Cuadrado from the European Union Intellectual Property Office (EUIPO) then explained the relationship between trademarks and GIs in EU law and the examination practice of the EUIPO. Pilar Montero from the University of Alicante spoke about the scope of protection of GIs, which has developed from EU law and the case law of the European Court of Justice.
 

GIs from an international perspective

In the morning’s second session, the workshop focused on the international perspective. Roxana Blasetti from the University of Buenos Aires, who is a Visiting Scientist at the Institute, presented the negotiated solution for the mutual protection of GIs of the contracting parties in the Free Trade Agreement between the EU and the Mercosur countries.

Subsequently, Max Planck researchers Suelen Carls and Pedro Batista gave an overview of the Institute's project "Smart IP for Latin America" and explained the research activities related to the component of the project devoted to examining the protection of GIs in selected Latin American countries. In the final talk, Alexandra Grazioli, Director of the World Intellectual Property Organization (WIPO), spoke about opportunities and challenges for the Lisbon Agreement on Appellations of Origin and Geographical Indications administered by WIPO following the entry into force of the Geneva Act on 26 February 2020.

The workshop ended with an intensive discussion in the afternoon of the second day, moderated by Max Planck researcher Annette Kur. The valuable feedback from the participants gave the Institute's research group important impulses for their further work. After the empirical analysis of the GIs registered in the EU, the project will focus on the functioning of the national authorities involved in the protection system and on the cooperation between them, the applicants and the EU Commission. Based on these empirical findings, an analysis of selected legal questions will follow.

The power of digital platforms does not only pose new challenges for consumers and small businesses, but also for competition authorities. The extent to which competition policy needs new instruments to counteract tendencies of power concentration in the platform economy has for long been at the center of an ongoing debate. The planned 10th amendment to the Act against Restraints of Competition (GWB), now intends to provide the Bundeskartellamt with additional instruments enabling the authority to act more effectively with regard to digital companies who possess market power. The aim of the law is to create a “digital regulatory framework”.
 

On the occasion of the official publication of the draft bill, Thorsten Käseberg, Head of the Department of Competition and Consumer Policy at the Federal Ministry of Economics, presented an overview of the planned new provisions of the "GWB Digitization Act" at an event at the Max Planck Institute for Innovation and Competition co-organized by the Münchner Kartellrechtsforum e.V.
 

The centerpiece of the draft bill is the modernization of the rules on abusive conduct by companies who possess outstanding market power. "You can say that the wind has turned significantly with regard to this concern”, said Käseberg at the beginning of his lecture, summarizing the general sentiment both in society and in many competition authorities worldwide. An increasing number of observers have indicated that with the traditional rules the authorities would hardly be able to effectively control certain unilateral strategies of dominant companies in the digital sector.
 

The amendment addresses the increasing importance of data by introducing "access to competition-relevant data" as an additional factor for assessing the market position of a company (Section 18 (3) GWB, new version). In addition, in the new Section 18 (3b), the concept of "intermediary power" as a factor for determining a dominant market position has been introduced to the law. This provision intends to better capture the role of platforms as intermediaries in multilateral markets.
 

By expanding the "Essential Facilities Doctrine" the GWB amendment takes the importance of data for digital business models into account. "We have tried to open up and internationalize the provision which previously only referred to physical infrastructures”, said Käseberg. If a dominant company refuses to grant another company access to data, this behavior can be classified as abusive under certain conditions according to the new Section 19 (2) No. 4. "Even if we cannot finally solve the issue of data governance, we want to create an instrument for cases of clear abuse.”
 

According to Käseberg's assessment, the new Section 19a is expected to be highly controversial. This provision addresses platforms who dispose of an outstanding market power across several markets. With regard to such companies the Bundeskartellamt would be able to establish that they belong to this category and to subsequently interdict certain strategies of such platforms. This includes self-preferencing, leveraging of market power and impeding data portability.
 

The German rules on abusive conduct apply already below the market power threshold in the case of relative market power or dependency. According to the planned revision of Section 20 (1) the application of these rules will in the future not any more be limited to cases where small and medium enterprises are possible plaintiffs.
 

In addition to the reform of abuse control, the 10th amendment to the GWB will adapt the thresholds for merger control and create more legal security for cooperation between companies. The amendment also implements the ECN+ Directive, which aims to strengthen the competition authorities in the EU Member States.

For the second time now, the two-day event was organized by Ph.D. students and Postdocs of the Department for Innovation and Entrepreneurship Research headed by Dietmar Harhoff to give young scholars the opportunity to present and discuss their work.

This year’s attendants experienced two workshop days filled with an exciting program comprising 14 paper presentations on the Economics of Innovation, Science and Entrepreneurship based on various methodological approaches, which were followed by 14 discussions from experienced researchers. A special highlight of the event was the inspiring keynote speech by Pierre Azoulay, Professor at the MIT Sloan School of Management and Research Associate at the National Bureau of Economic Research.

On the first day, the workshop focused on topics related to the determinants of scientific productivity. Speakers presented research findings on how scientists select interesting research questions and potential collaborators as well as on the relevance of access to funding and research tools. The afternoon was dedicated to the role of gender in science, especially to analyzing peer effects and the importance of female role models. To conclude the day, keynote speaker Pierre Azoulay presented interesting research results on “The Impact of Scientific Training on Today’s Trainers”. He emphasized the role of training in nurturing scientific talents and the importance of building programs that incentivize them to remain active in science.

The morning of the second day offered interesting insights on innovation and entrepreneurship. Young scholars presented research on the geographic diffusion of knowledge as well as on the transfer of scientific knowledge into commercial applications. They shed light on the circumstances under which universities and individual researchers foster the innovation outcomes of their communities. In the afternoon, the workshop focused on the design and effects of intellectual property rights regimes. Researchers simulated the consequences of changes in the current European patent system. Additionally, they provided evidence on the effects of patents on start-ups as well as on the pricing behavior of firms.

See the complete program with all topics here and check out on Twitter under #RISE2Workshop.

The RISE workshop series aims at stimulating a rigorous in-depth discussion of a selected number of research papers by Ph.D. students and Junior Postdocs, providing feedback and connecting with peers from other research institutions. Accordingly, the workshop brings together young researchers from all over Europe and the US with researchers from the Munich Innovation Community.

We thank all organizing parties involved and all participants, including the keynote speaker, discussants and presenters for a truly outstanding RISE2 Workshop 2019. With great enthusiasm and motivation, we look forward to the RISE3 Workshop 2020.