Protecting Intellectual Property Rights Abroad: Due Process, Public Interest Factors, and Extra-Jurisdictional Remedies
Several recent antitrust investigations involving the licensing of intellectual property rights (IPR) have raised concerns about fundamental due process and the alleged use of industrial policy in antitrust investigations to lower royalty rates, particularly for standard-essential patents (SEPs), in favor of local implementers. These concerns raise serious problems for innovation, economic growth, and consumers, and are likely compounded by the use of extra-jurisdictional remedies whereby one agency imposes worldwide portfolio licensing remedies, including on foreign patents, for conduct that may be deemed procompetitive or benign in other jurisdictions, which may facilitate a lowest-common-denominator approach.
With respect to due process, reported concerns focus on the lack of the ability to meaningful present a defense to decision-makers, including allowing the participation of local and international counsel, notification of the legal and factual bases of an investigation, and the right to appeal any decision to an independent tribunal. Industrial policy concerns are tied, at least in part, to the fact that many foreign competition laws explicitly provide for the consideration of non-competition public interest factors. For example, China’s Anti-Monopoly Law (AML) states that its purpose includes “promoting the healthy development of the socialist market economy,” and that “[t]he state constitutes and carries out competition rules that accord with the socialist market economy, perfects macro-control, and advances a unified, open, competitive and orderly market system.”2 Korea’s Monopoly Regulation and Fair Trade Act states that its purpose is the promotion of “fair” competition and the achievement of “balanced economic development,”3 while India’s Competition Act instructs the Competition Commission to “keep in view…the economic development of the country.”