The European Commission invites comments on a proposal for new competition rules for the assessment of technology transfer agreements, through which a licensor permits a licensee to exploit patents, know-how or software for the production of goods and services. The proposal aims to update the current regime in order to strengthen incentives for research and innovation, facilitate the diffusion of intellectual property and stimulate competition. In light of stakeholders' submissions, the Commission will adopt a new regime before April 2014.
Licensing is vital for economic development and consumer welfare as it helps to disseminate innovation and allows companies to integrate and use complementary technologies. However, licensing agreements can also have a stifling effect on competition. For instance, two competitors could use a licence agreement to divide markets between them or an important licensor could exclude competing technologies from the market through conditions in its licensing agreements. Anticompetitive agreements are prohibited by Article 101 of the Treaty on the Functioning of the European Union. The way intellectual property right holders license their rights to other market participants is crucial for stimulating innovation and preserving a level playing field in the internal market.