Judicial Criteria for Determining SEP/FRAND Licensing Royalties and Related Procedural Issues
DOI:
https://doi.org/10.18256/2238-0604.2026.v22i.5332Keywords:
Patent rights; standard essential patents; FRAND licenses; royalties; Unified Patent Court; civil procedure lawAbstract
The proper setting of royalties on FRAND licenses has been a controversial issue and royalty base has been the subject of heated debate for some years now. On the one hand, the royalty rate base, in isolation, is irrelevant since the royalty rate applied to that base can always be adjusted upwards or downwards to match the selected base. In setting reasonable royalty payments, we must keep in mind both licensees and patent holders, and do our best not to bias the licensing process to one or the other side. At the end of the distribution chain, there are also the final consumers. There is no miracle approach that authorizes the calculation of FRAND royalties. This calculation implies, on the contrary, taking the context into account and forging an approach adapted to the case. A reasonable royalty payment can be achieved either through the use of apportionment or reliance on the entire market value rule. Practical reasons call for the use of the entire market value rule, except in situations where certain components form the basis of demand for this type of product. Component value is not always separable from full product value. In any case, we should cross as much as possible the different methods of calculating rates according to the circumstances of the case. Of course, the determination and quantification of these licenses raise significant issues of civil procedure law that have not yet been resolved (eg. international jurisdiction; lis pendens; anti-suit injunctions, counterclaim).
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