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Motorola escapes fine after breaching EU competition law

The company tried to take out and enforce a patent injunction against Apple, despite it agreeing to pay royalties for its use.

European Commissioner for Competition Joaquin Almunia addresses the media after the Motorola ruling.
European Commissioner for Competition Joaquin Almunia addresses the media after the Motorola ruling.
Image: Yves Logghe/AP/Press Association Images

The European Commission (EC) has found Motorola guilty of breaching EU competition law, but it will not be fining the company for its violation.

The EC ruled that Motorola broke European Union (EU) antitrust rules by trying to enforce a patent injunction against Apple, saying it was “abusive”. However, the EU decided not to fine the company because of the lack of case law in EU courts dealing with such cases, and diverging conclusions in national courts.

If the EC decided to fine Motorola, it amount paid could have been as much as 10 per cent of its annual global turnover.

The patents in question related to GPRS, part of the GSM standard, which is used for both mobile and wireless communication. Motorola had said the patents were standard-essential, and therefore would be licensed to Apple under the usual “fair, reasonable and nondiscriminatory,” (FRAND) terms.

Under EU guidelines, owners of patents that are essential for standard features, like 3G, should license them on FRAND terms.

In 2011, Motorola tried to take out and enforce an injunction against Apple in Germany based on the patent, even though Apple said it would pay royalties, to use the patented technology.

Speaking after the ruling, the commission vice president Joaquin Almunia said that such “patent wars” shouldn’t happen at the expense of consumers.

Our decision on Motorola, together with today’s decision to accept Samsung’s commitments, provides legal clarity on the circumstances in which injunctions to enforce standard essential patents can be anti-competitive. This will also contribute to ensuring the proper functioning of standard-setting in Europe.

>While patent holders should be fairly remunerated for the use of their intellectual property, implementers of such standards should also get access to standardised technology on fair, reasonable and non-discriminatory terms. It is by preserving this balance that consumers will continue to have access to a wide choice of interoperable products.

The EC also said it had accepted a pledge from Samsung not to seek injunctions against rivals if they signed up to a licensing agreement for smartphones or tablets.

This pledge will be in effect for five years and is legally binding.

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Quinton O'Reilly

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