IEEE Boosts Standards Patent Policy by Permitting Fuller Disclosure on Licensing
May 4, 2007 // Published as a news service by IHS
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The Institute for Electrical and Electronics Engineers (IEEE) Standards Association (IEEE-SA) enhanced its patent policy by permitting the disclosure of licensing terms associated with patents that might be included in its standards.
The policy changes are intended to make the IEEE standards-setting process more transparent and go into effect May 1.
On April 30, the U.S. Department of Justice (DOJ) issued a business review letter on the new policy in response to a request from the IEEE-SA.
The letter stated that the policy has pro-competitive benefits and that the DOJ had no intention of challenging the policy.
The IEEE-SA sought the letter to address any concerns that existed on the new policy, even though the DOJ and the U.S. Federal Trade Commission made clear in the past two years that policies like the IEEE-SA's new policy are permissible.
In addition to permitting disclosure of licensing terms, the IEEE-SA clarified other aspects of its patent policy. The clarifications and other changes to the policy include several key elements.
The policy encourages the optional disclosure of royalty rates and other license terms of a potentially essential patented technology early in the development of a draft standard. The patent holder may provide a not-to-exceed license fee or rate commitment, a sample license agreement or one or more material licensing terms.
The policy also:
- Makes a patent holder's assurance irrevocable once accepted by the IEEE and requires the patent holder to give notice of the existence of the assurance when transferring ownership of the patent rights.
- Binds the patent holder's affiliates to the terms of the given assurance unless the patent holder explicitly identifies affiliates it does not wish to bind.
- Requires individuals participating in developing a standard to disclose the name of the holder of patents that are potentially essential to the standard based upon personal knowledge. This applies to patents held by the individual or their employer.
"IEEE standards policies and procedures must change as the world changes to ensure our standards serve those who create and use them," said Judy Gorman, IEEE-SA managing director. "Our new patent policy is a good example of this. We spent several years creating this policy and had strong participation from industry in doing so.
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"Our new policy encourages voluntary disclosure of maximum royalty rates and other licensing terms and allows IEEE standards working groups to include these in their comparison of relative costs for the technology alternatives they consider for a standard. As a result, our working groups will make choices based on more informed cost-performance evaluations. This should encourage competition and benefit anyone who seeks to comply with IEEE standards."
Source: Institute for Electrical and Electronics Engineers (IEEE).