Justifying Antitrust Intervention in ICT Sector Patent Disputes: How to Address the Hold-Up Problem

Kai-Uwe Kuhn, Dec 20, 2013

The economic justification for any regulatory intervention in patent litigation, especially those for standard essential patents, comes from the view that hold-up of users of patents is endemic to some industries, especially ICT. The paper reviews these reasons why hold-up is more likely in ICT industries and discusses the type of evidence that is available. It discusses the strengths and limitations of competition policy instruments and notes that addressing the issue is far more appropriate under an abuse of dominance standard that allows for exploitative abuses to be addressed. It is finally explained that nevertheless the use of such an instrument has severe limitations and explores the question of how incentives of standard setting organizations can be improved to make commitments to FRAND licensing more meaningful.

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