IP Licensing and Antitrust Law – What Companies Have to Consider When Doing Business in the U.S. and the EU

In both the U.S. and the EU, it is generally acknowledged that the enforcement and commercialization of IP rights must comply with the applicable antitrust laws. This is particularly true for IP licensing. While the majority of provisions in license arrangements will not be problematic from an antitrust perspective, some restrictions may raise antitrust concerns (particularly due to a potential violation of the respective cartel bans). Both the U.S. and the EU have set up a legal framework of IP-related antitrust legislation, varying in structure and content, but featuring a common core of overall principles. It is the common view in both regimes that IP rights and antitrust laws “share the common purpose of promoting innovation and enhancing consumer welfare.” Nonetheless, where it is applicable, antitrust law poses a potential threat to void relevant clauses or even an entire agreement, and undertakings run the risk of being fined for any violation of antitrust law. Thus, it is indispensable to take into account relevant antitrust law when drafting and negotiating licensing agreements. In the following paragraphs we will discuss the key antitrust concepts that need to be borne in mind when licensing IP in transatlantic business.

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