[A2k] Statement by the United States on patents and standards at WIPO patent committee

[Thiru Balasubramaniam]

http://www.keionline.org/blogs/2009/03/25/united-states-position-patents-st=
andards/

Statement by the United States on patents and standards at WIPO patent
committee

March 25th, 2009

Patents and Standards

The United States thanks the International Bureau for preparing the
background paper on Standards and Patents, and we support the
statement made by Germany on behalf of Group B.

Mr. Chairman, the United States supports and strongly encourages the
use of open standards, as traditionally defined, that is, those
developed through an open, collaborative process, whether or not
intellectual property is involved.

Open standards can improve interoperability, facilitate interactions
ranging from information exchange to international trade, and foster
market competition.

Open standards systems offer a balance of private and public interests
that can protect IP with fairness, disclosure policies, and reasonable
and non-discriminatory licensing.

When developed by broadly accepted bodies or organizations, even
voluntary standards can become widely adopted. Because of these
benefits, use of open standards in the traditional sense is strongly
encouraged whenever practical.

In our view, the standard setting process should be voluntary and
market-driven. Unnecessary government intervention can impair
innovation, standards development, industry competitiveness, and
consumer choice.

While encouraging innovation, a properly structured public and private
partnership can potentially balance the interests of patent holders
which endeavor to exploit their patents, with those of producers which
want to license and produce the goods covered by the standards at
reasonable prices, and of the public which seeks the widest possible
choice in the marketplace among interoperable products.

To effectively respond to the challenges posed by globalization, the
emergence of new economic powers, public concerns such as climate
change, and the need to remain current with evolving technologies,
standards development organizations and the standards development
process itself must be flexible as well as capable of adapting the
most innovative and best performing technologies available.

We believe that patent owners should be provided the incentive to have
their proprietary technologies included in the standard under fair and
reasonable terms.

Without the commercial return there is no incentive for investors to
fund research and development into new technology. Therefore, the
incentive to develop and use patented technologies in standards should
not be undermined.

The U.S. is a market =96 driven, highly diversified society, and its
standards system encompasses and reflects this framework.

Individual standards typically are developed in response to specific
concerns and constituent issues expressed by both industry and
government.

The United States is not in favor of a mandatory single set of uniform
guidelines which will deprive the U.S., its diverse standard setting
community and its innovative industries of its current flexibility in
developing standards according to different processes and policies.
These are driven by the objective of the particular standards project
and the related market factors.

The U.S. government recognizes its responsibility to the broader
public interest by providing financial and legislative support for,
and by promoting the principles of, our standards setting system
globally. U.S. industry competitiveness depends on standardization,
particularly in sectors that are technology driven.

The United States doesn=92t encourage government intervention. The
issues have long been discussed and are rejected because they hinder
innovation, standards development, US industries=92 competitive
advantage and attendant benefits to consumers.

The United States remains a strong supporter of our policies that
allow U.S. standards developers to participate in international
standards development activities without jeopardizing their patents,
copyrights and trademarks.

Today, more than 16,455 standards are approved as International
Standards (with about 1800 more in the pipeline) and 11,500 of these
as American National Standards. Thousands more are adopted by industry
associations, consortia, and other Standard Setting Organizations on a
global basis.

Yet the number of disputes that result in litigation per year is
typically in single digits, and the vast majority of these cases
involve specific fact patterns. In other words, there is NOT a crisis,
as claimed by some, in standard setting.

If I might offer a few words on the =93Competition Law Aspects=94 section
of the paper.

In the United States, antitrust enforcers seek to ensure that our
markets are competitive by preventing agreements or mergers that
create or increase market power, or unilateral actions that use
existing market power to protect or expand a monopoly. Our focus is on
preventing harm to the competitive process, not on ensuring
competitors treat each other fairly. Therefore, we would strike the
use of =93fair=94 wherever it appears before =93functioning of the market=
=94
and when it modifies =93competition=94 or =93market=94

In the United States, we do not to use the term =93abuse=94 in conjunction
with IP rights because it often is confused with the concept of patent
misuse and because the term is too abstract. We would replace =93an
abuse=94 with =93illegal collusive or exclusionary conduct=94 throughout
this section.

Because this section does not cover potentially anticompetitive
agreements, such as horizontal practices among members of standard-
setting organizations that collude on prices or exclude competitors,
we suggest referring generally to =93illegal collusive or exclusionary
conduct=94 when discussing competition law aspects.

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Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International (KEI)
thiru@keionline.org


Tel: +41 22 791 6727
Mobile: +41 76 508 0997