Chillin'Competition

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Archive for the ‘Other interesting papers’ Category

‘Stealth Licensing’ – Are Antitrust Law and Trade Regulation Squeezing Patent Rights ?

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Monsieur le Professeur Nicolas Petit has just published a piece titled “Stealth Licensing”- Or Antitrust Law and Trade Regulation Squeezing Patent Rights. In this paper he illustrates his points by resorting to metaphors on black swans and butterflys (read the last sentence in the 3rd paragraph below), which is a good indication that he may well have definetely lost it   😉   

In Nico’s view (and from now I’m pasting the paper’s abstract): a “stealth licensing” paradigm is emerging across the globe. It can be seen through subtle interventions from policy makers, judicial organs and administrative agencies. Those interventions seek to facilitate compulsory licenses outside the TRIPS agreement exceptions and/or to water down those exceptions. Altogether, they ramp up pressure on patent owners to give away their freedom – it is actually a “right” – to exploit their innovations as they see fit. The paper submits that stealth licensing is a significant phenomenon that adversely impacts the social welfare functions of the patent system. It risks undermining investment in technology, technology creation and the dissemination functions of the patent system at a critical juncture in time, as new critical technologies like green technology, the internet of things, machine to machine technology, smart medical devices or biotechnologies are being called for, and rolled out, across the globe. Moreover, stealth licensing is occurring despite the fact that both private and public investment in R&D is critical to help developed economies back on the path to growth, competitiveness, employment and prosperity.

This paper the concept and policy of “stealth licensing”. To that end, it first surveys the literature on the social functions of the patent system, and in particular, on the role of patents to incentivise (risky) R&D efforts and to disseminate successful technological innovations (I). In this context, it recalls that whilst divided on the exact function of patent law, scholars broadly concur that patents have social utility. The paper then shows the emergence a “stealth licensing” paradigm adversary to the social functions of the patent system. To aid understanding, it starts with a definition of the concept of “stealth licensing” (II). It then describes its emergence in international trade regulation where a “flexible” interpretation of the TRIPS compulsory licensing exceptions is making way (III); and in antitrust law, where a distinct though equally problematic “undercover” licensing paradigm is gaining prominence (IV). Finally, it explains the perils of squeezing patent rights through stealth licensing with two metaphors: that of a black swan (V) and that of a butterfly (VI).

For a link to all of Nicolas’ previous articles available on SSRN, click here.
On a related note, I’m told that, in addition to other interesting articles, the April issue of European Competition Journal  features a couple of pieces that partly discuss Nicolas’ prior writins on Standard Essential Patents. I was also told that if I wrote this here he’d get a free copy of the issue…
And if you want to register to attend the conference on Conflicts of Interest, Ethical Rules and Impartiality in EU Competition Policy that Nico has put together and that will take place on Thursday  (you already know my views on this subject), you can do so here.

Written by Alfonso Lamadrid

22 April 2014 at 6:32 pm

Supermarket power

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Some of the tastiest issues in current competition law arise in the food sector. In fact, as you’ll see in a second, some of those issues are the same ones that we often face in other dynamic two-sided markets that generally attract more public attention.

At Chillin’Competition we’ve always paid our fair share of attention to food distribution and groceries (in fact our first posts on endives still ranks among out most read ever  (actually, when you search for Chilling Competition on Google the word endives appears immediately in the autocomplete box, which may seem a bit odd). Today, we’re happy to include a “sponsored link” to the work done on this subject by a good friend of ours.

Javier Berasategi (former lawyer at Stanbrook in Brussels, former President of the Basque Competition Authority –yes, there is one-, surfer, runner, alpinist and overall a quite unique guy now running a solo legal practice) has authored an also quite unique work on supermarket power. As always, it’s original, thought provoking and perhaps a bit controversial.

But regardless of whether one agrees or not with the analysis and the suggestions in it, its approach is certainly interesting; here’s the abstract:

“This paper analyses the sources of supermarket power vis-à-vis shoppers and independent brands. This power transforms leading supermarkets into vertically-integrated competitive bottlenecks that are able to restrict competition between brands (including their own ones) and reduce consumer welfare. However, competition enforcement has failed to address their bottleneck role and the negative consequences of their practices on dynamic competition (i.e., a market where the competitive process fosters innovation, quality and variety), the ultimate goal of competition policy. This paper proposes complementary regulatory and competition remedies to ensure that access to supermarket platforms and competition within them promotes fair dealing, consumer welfare and economic growth. It draws inspiration from the remedies enforced in other competitive bottlenecks such as CRSs, mobile communication networks, internet service providers, internet search engines and credit card networks”.

[It’s interesting that the paper brings together groceries and tech stuff, particularly following Nicolas Sarkozy’s cautionary words about the perils of comparing endives to Apple (see here). Although, to be fair, Kevin Coates had done a similar link before with his “exploding banana hypothesis” (I’m saying this to force him to explain it on 21st Century Competition …)].

The report, titled Supermarket Power: Serving Consumers or Harming Competition, is available here  Take a look, it’s only slightly above 350 pages.

Further work on this subject will also be made available through a new website: http://www.supermarketpower.eu/en/

P.S. The picture may be subject to copyright, but I deserve full credit for having found an image of a supermarket actually called power.

Written by Alfonso Lamadrid

4 March 2014 at 5:47 pm

Antitrust and Tech Seminar Materials

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A few days ago I participated at a very interesting AIJA seminar in Bruges on Antitrust and Technology. All panel discussions were great, but I’m particularly grateful to Pablo Ibañez (LSE) and Kevin Coates (DG Comp) for their participation in the panel I moderated on interoperability issues, which was truly excellent (and not because of me).

The presentations projected at the conference have been made available at AIJA’s website (I include the hyperlinks below for your convenience):

  • Technology Licensing and the New TTBER

Dominic Muyldermans – Exclusion of termination for challenge of IP

Olivier Sasserath – Exclusion of the exclusive grant-back obligations

Anna Vernet – update after public consultation

Stefan Vollering – Big Change on a Minor Issue

  • Keynote speech – With great power comes great responsibility

Dr Philip Marsden – With great power comes great responsibility

  • Caught in the antitrust web -Regulating internet services

Gerardo Faundez – Travel as evolving market

Thomas Graf – The EU Google Investigation

Silke Hossenfelder – German Antitrust Cases in the Internet Economy

Sebastian Jungermann – Regulating internet services

  • Patent litigation and settlements -The limits of settlements and Pay-for-delay

Tamar Dolev-Green – Pay-for-delay

Kyriakos Fountoukakos – Patent litigation settlements

Simone Gambuto – latanoprost-pfizer saga in Italy

  • Patent strategies and abuse of dominance What are the antitrust boundaries

Miguel Rato and Nicolas Petit – Abuse in Technology Enabled Markets

Maria Troberg – Patent Strategies and abuse of Dominance

Jan Peter Van der Veer – An economic perspective on patent strategies

  • Competition law and interoperability

Pablo Ibanez Colomo – Interoperability issues under EU Competition Law

Alfonso Lamadrid – Interoperability

 

(Image quite possibly subject to copyright)

Written by Alfonso Lamadrid

20 February 2014 at 11:22 am

Light summer reading

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It’s July; the weather is good even in Brussels; you should be either on holidays, enjoying outdoors, or finishing off work in order to be able to go out and to do some photosynthesis; but nevertheless you’re reading a competition law blog… (yes, writing it is even worse, but we aren’t talking about us now…).

So, there is cogent, consistent and sufficient evidence to indicate that you’re a bit of a geek. If that’s the case, these are 3 recommendations of short reads, all of which deal with issues on which we’ve touched in the past:

Wouter Wils, Ten Years of Regulation 1/2003, A retrospective– A very good and concise overview of the history and results of the procedural modernization of EU competition law (my only negative comment is that, for some unknown reason, it doesn’t cite my masterpiece, excellent, quite good, good, decent? more or less tolerable paper on the issue…)

– Thomas Graf – who together with Maurits Dolmans (click here for his Friday Slot interview) is the main lawyer for Google in the framework of the Commission’s investigation-  has written a blog post about Google’s proposed commitments., available here. It’s always interesting to know the impressions of those with first hand knowledge of cases. My own post on this subject is referred to as a one among three “thoughtful comments”; not sure if that is because my post was any good or because we actually have similar views on the main issues…

– Also on Google, last week I received a piece published in the Financial Times positing that “true progressivists” would seek Google’s break up.

Actually, this was of quite some interest to me, since (as frequent skimmers may remember)  I’ve devoted a few posts to what “true progressivism’ or “radical centrism”should mean to the antitrust world: see here (for the original post), here (for the short article developing the post), and here (for an interview in which I’m quoted saying that both the post and the article are superficial exercises of wishful thinking -I’ve original marketing techniques, you see..-).

Not being a fan of labels, I would have more or less defined myself as a radical centrist, and nevertheless I fail to see the reasons for Google’s breakup; query: does that make me a bad centrist?! The author of this interesting piece is Prof. Richard Sennet, a LSE professor. Since I didn’t recognize the name I “Googled” it and saw that he’s professor and expert in urban sociology.

Now, this is a worrying development for most competition lawyers. First it was economists who (quite successfully) started to eat “our cake” become antitrust experts, and now it’s urban sociologists!!  I guess it’s time to retaliate and send the FT my expert piece on the effects or rural migration in postmodern Spain..  😉

Written by Alfonso Lamadrid

8 July 2013 at 9:23 pm

Preliminary thoughts on Google’s proposed commitments

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As long anticipated, here are some comments on the proposed commitments in the Google case (I graciously granted myself an extension, like the one other third parties have received; it actually is convenient because I can comment on others’ comments as well).

Four caveats are in order:

  • The views expressed below are written against the background of the Commission’s concerns as set out in the press release and the Q&A doc. accompanying the market testing of Google’s proposal. The relevant question to keep in mind is whether the proposed commitments –in their current form- are apt to address the concerns identified by the Commission in its preliminary assessment, not whether they are apt to lead to candy world for satisfy the wishes of all third parties.
  • My views are necessarily incomplete and they’re also work in progress. I’ve only read the limited publicly available information and have not had access to any confidential info or documents that might be contained in the case-file.  Moreover, I have allocated two flights time to draft this (and I should ideally also do some billable work, you see), so I’ll (i) update and improve this document on the basis of any new thoughts or possible feedback and (ii) refine my thoughts for a forthcoming piece on Oxford’s Journal of Competition Law and Practice
  • My views are mine (sounds like a tautology, but don’t always take this for granted in our area of work…); some of my colleagues and clients may well have different opinions.
  • I haven’t worked nor for Google nor for any of the 17 complainants.

In case I haven’t yet got you tired before even starting, here is a methodological explanation. This will be a five-pronged analysis; I will very succinctly summarize (i) DG Comp’s concerns; (ii) my take on the substantive concerns; (iii) the content of the proposed commitments; (iv) third-party criticism of the proposal (notably that read here, here, here or here) (I actually read some favorable comments as well); and (v) my take on the proposed commitments.  And this for each of the four concerns flagged by the Commission (although only the two first ones raise interesting issues).

The structure will make this post longer. In order not to cram the page, click if interested.

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Written by Alfonso Lamadrid

13 June 2013 at 7:00 pm

Data protection and antitrust law

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Regretably I couldn’t attend Concurrence’s New Frontiers of Antitrust conference held last Friday in Paris in spite of Nicolas Charbit’s kind invitation. I hear that the conference was once again most interesting, so congrats again to Nicolas and the rest of the team at Concurrences.

Perhaps the most prominent topic in this year’s program related to the interface between data protection and antitrust law. I’m sorry to have missed the discussions over this issue, for perhaps they would have enabled me to see where’s the substantive beef that justifies all the recent noise. Whereas I understand the practical reasons why this issue has conveniently become a hot one in certain academic circles, I confess my inability to see the specific features that make this debate so deserving of special attention.

The way I see it, personal data are increasingly a necessary input to provide certain online services, notably in two-sided markets. So far so good. But this means that personal data are an input, like any other one in any other industry, with the only additional element that the recompilationa and use of such input is subject to an ad hoc legal regime -data protection rules-.

In my view, competition rules apply to the acquisition and use of personal data exactly in the same way that they apply to any other input, and then there’s a specific layer of protection. I therefore understand that data protection experts have an interest in finding out about the basics of antitrust law to realize about how it may affect their discipline, but I fail to see the reasons why competition law experts and academics should devote their time to an issue which, in my personal view, raises no particularly significant challenges. [The only specificity may be that data protection practices may constitute a relevant non-priceparameter of competition, for companies may compete on how they protect consumer data]. I would argue that this is a serious matter, but one for consumer protection laws to deal with, and in which competition policy may at most play a marginal role (I understand this was also the view expressed by Commissioner Almunia in a recent speech).

To compensate for my absence at Concurrence’s conference, on Saturday morning I read some interesting “preliminary thoughts” published last week by Damien Geradin and Monika Kuschewsky: Competition Law and Personal Data: Preliminary Thoughts on a Complex Issue. The piece provides a contrarian view to the one I just expressed. Since I might very well be wrong (that’s at least what my girlfriend’s default assumption in practically all situations…) I would suggest that you take the time to read it in order to make up your own mind. It won’t take you long, but since behavioral economics (and the clickthrough rates to the links we show) tells us that many of you are of the lazy type, in the interest of a balanced debate here’s a brief account of its content; my comments appear in brackets:

(Click here if you’re interested in reading more)

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Written by Alfonso Lamadrid

25 February 2013 at 1:47 pm

Competition Policy and Happiness

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Many of you have probably had a chance to read various texts on the goals of competition law (the one in Giorgio Monti’s book is particularly good; more recently, I also liked Kevin Coates’ approach).

For an original approach to this discussion, check out Maurice Stucke’s recent paper “Should Competition Policy Promote Happiness?”  As noted in the abstract, the paper builds on recent academic literature on happiness and goes on to argue that “competition policy in a post-industrial wealthy country would get more bang (in terms of increased  well-being) in promoting economic, social and democratic values, rather than simply promoting a narrowly-defined consumer welfare objective“,

Many thanks to Wouter Wils for the pointer!

 

P.S. And speaking of papers, Pablo Ibañez, Hans Zenger and myself could use some additional votes for Concurrence’s Antitrust Writing Awards   😉

Written by Alfonso Lamadrid

20 February 2013 at 1:41 pm