Newsletter Edition 31 - December 2021


The arduous balance of standard-essential patents

How to protect the rights of the standard-essential patent holder while guaranteeing free competition and social interest? The speakers at the debate on “The controversy over standard-essential patents”, Gabriel Leonardos, from ABPI, Judge Cláudia Telles de Menezes, of the 5th Civil Chamber of TJ-RJ and Professor Enzo Baiocchi, from UFRJ (the Federal University of Rio de Janeiro), concluded that there is no easy legal solution to this issue, which is not provided for in the Brazilian Industrial Property Law (Law 9,279/96).

In his speech, ABPI’s President Luiz Edgard Montaury Pimenta highlighted the relevance of the discussion on standard-essential patents at a time when Brazil is incorporating 5G technology, which will be adopted by mobile operators. He also recalled that, precisely in the telecommunications area, where the largest stock of patent examinations pending at the BPTO resides, the well-known patent backlog, many are stillborn. In other words, the applicant for these patents has complied with all its obligations, such as the payment of fees and annuities, and due to the excessive delay in the examination, the patent is granted after its validity period has expired. “ABPI filed a structuring public action in the federal court in order to enable the BPTO to manage the funds it collects, thus being able to hire examiners, technology, and equipment to help overcome the historical and unacceptable problem of the patent backlog”, explained the president of the ABPI.

Leonardos cited the opinions of jurists José Carlos Vaz e Dias and Heloísa Carpena Amorim on standard-essential patents and pointed out open issues on the subject, such as the lack of standardization by international certifying bodies, the prohibitive cost of calculating the patents associated with the invention, the calculation basis and royalties for the value of the license and the difficulty of conceptualizing the FRAND license in Brazil (fair, reasonable and non-discriminatory), a licensing under conditions that allow the entire industry to benefit from standard technology. “Is it reasonable for the calculation basis of the license fee to be the value of the product? Or should we only consider the part of the product where the patent technology is applied?”, he asked.

For Judge Cláudia Telles de Menezes, in the standard-essential patent, the balance between intellectual property rights and the public interest is “very tenuous”. “In the judiciary, we have to be very careful about this issue”, she said. “We have a lot of discussions about infringements on standard-essential patents and a lot of injunctions prohibiting or authorizing their use”, she explained. In his speech, Professor Baiocchi also considered it difficult to reconcile the interests of the private holder, competitors, and society in the legislation. “What we are looking for is a fair balance, a peaceful solution, lasting social peace”, he said. “And who will ensure this balance is the State, especially the Judiciary”.