EU regulators on Monday closed an antitrust investigation into Âstandard settingÂ rules employed by telecom standards group ETSI (European Telecommunications Standardisation Institute), an independent organisation that sets standards in Europe, to ensure that its procedures do not allow
The investigation was commenced by the European Commission (EC) due to concerns that a flaw inÂ ETSIÂs procedures could allow companies to carry out a ‘patent ambush’.Â
A patent ambush involves a company withholding information about patents held around a proposedÂ standard. If this standard is agreed, the relevant company declares its rights, obtaining controlÂ over the standard. The other companies are then forced to pay royalties to the holder of theÂ patent if they wish to implement the standard.
Voicing its concern over ETISÂs inadequate transparency rules the EC said, ÂThe CompanyÂs actionsÂ mean that the possibility of considering alternative technologies has been artificially removed,Â and that the competitive process has been distorted.Â
The EC recommended that ETSI must make sure that information about patents surrounding a proposedÂ standard are freely available.
“It should be clear that a particular technology is covered by a patent before a standard is set,Â so this can be taken into account when deciding whether to set the standard,” said an EC spokesmanÂ during the investigation period.
The dismissal of the investigation is consequent to the change in patent rules by ETSI inÂ accordance with the ECÂs recommendations as to the transparency of its procedures.Â
ÂStandards are of increasing importance, particularly in hi-tech sectors of the economy,Â saidÂ Competition Commissioner Neelie Kroes, welcoming the changes.
ÂIt is crucial that standard-setting bodies establish rules which ensure fair, transparentÂ procedures and early disclosure of relevant intellectual property. We will continue to monitor theÂ operation of standard-setting bodies in this regard,Â she added.
The tougher rules now require the companies to make it clear if they have a patent that a standardÂ depends on.
“This will avoid so-called patent ambushes where a company may only reveal after the standard isÂ set that its technology is covered by intellectual property rights,” said EU spokesman JonathanÂ Todd.