An Analysis of Intellectual Property, Dominance, and Licensing

This essay provides a comprehensive overview of intellectual property law, focusing on key concepts such as industrial property, copyrights, and international implications. It delves into the definition and implications of a dominant market position, as defined by the European Court of Justice, and examines the concept of abuse of such a position, detailing various abusive practices. The essay further explores the circumstances under which compulsory licenses are granted by courts and the role of Technology Transfer Block Exemption Regulations. It differentiates between horizontal and vertical licensing agreements, highlighting their distinct characteristics and impacts on market competition. The analysis includes a discussion of the IMS Health v Commission case, illustrating the practical application of these legal principles. Overall, the essay aims to provide a clear understanding of intellectual property law's complexities and its impact on market dynamics.

Intellectual property refers to creation of mind which includes artistic work, literary, designs,
images, names and symbols. It has two categories industrial property and copyrights. Industrial
property includes industrial design, patent, geographical indications and trademarks. Copyrights
includes artistic work, films, music, literary works and architectural design. In international arena
intellectual property is the highly treaty-bound area in which the international aspect goes largely
toward the enforcement of private rights across territory 1. International intellectual property will
involve in determining the rights to work in another country than its country of production.
International intellectual property law involves the use of treaty regimes and the other tools of public
international law to create international predictability enforcement of private rights.
In this essay there is constitutes a dominant market position and the abuse of dominant market
position. There is the circumstances in which will compulsory licenses be granted by court and the
technology transfer block exemptions regulations are also explain. There is the difference between
horizontal and vertical licensing agreements. In this there are some cases also have to explain.
Dominant market position
European Court of justice gave definition of market dominance that the dominant market relates
with the market dominance which has the position of economic strength enjoyed by an undertaking
which enables to prevent effective competition. It helps to maintain the relevant market by affording
the power to behave to an appreciable extent independently with competitor and the consumers 2. This
position does not preclude some competition which has the monopoly but it enables the undertaking the
profit and if it is not determine. But there is an appreciable influence on the conditions on which
competition will develop. An organization is in the dominant position if it has ability to behave
independently with competitors, suppliers and with the consumers.
Dominant organization has a market power that have a ability to set the price of competitive
level to sell the products which has the inferior quality. Under European law it is not illegal to hold the
dominant position. It can be obtained by legitimate competition by produce and sell the better products.
Competition rules cannot allow the abuse of dominant power in organizations 3. European merger
control system differs from this principle as it prohibits merged entities from obtaining dominant
1
Cornish, William. Llewelyn, Gordin Devid. and Aplin, Tanya. 2013. Intellectual property:
patents, copyright, trade marks & allied rights.
2 Vaver David. Intellectual property law: copyright, patents, trade-marks. [2011]

position by way of the merger. A dominant position can enjoyed jointly by two or more independent
economic entities in a specific market, this situation is called collective dominance.
Abuse of a dominant market position
Abuse of a dominant position occurs when a dominant organization in the market occupy in
conduct that is intended to eliminate the competitor with the result that competition is prevented.
Legitimate competitive behavior for correct action when the organization is busy in anti-competitive
activities that eliminate competitor and enhance their market power. An organization has ability to raise
the price which usually constrained by competitor and there is also the possibility that the customers
can do the alternative sources of supply 4. When the constraints are weak than organization market
power is to be in the position of dominance. When organizational behavior is an abuse of market power
as oppose competitive action that is the most controversial areas in competition policy. Competition
law stated the provisions prohibiting abuse of market power by dominant organization. Abusive
practices includes refusal of deals, excessive pricing, predatory pricing, bundling, margin squeeze and
loyalty rebates 5. It is important that organizational action considered abusive is important for
competition authorities because the economy and consumer would have damage by an incorrect
intervention. An organization with the large market share can considered dominant there is also need to
understand the law and economy.
The abuse of a dominant position by a firm may include excessive pricing of goods or services,
denying competitors access to an essential facility, price discrimination and other exclusionary acts 6.
The commission prohibits the abuse of a dominant position by an organization but it has not prohibit
the dominant position holding by an organization. The main difficulty for proving abuse of dominance
cases are significant and they require extensive legal and economic analysis. Where abuse of
3 Mazzone, Jason. Copyfraud and other abuses of intellectual property law. [2011]
4 Torremans Paul. Holyoak and Torremans. intellectual property law [2013] Oxford
University Press.
5 Beebe B. Intellectual property law and the sumptuary code [2010] Harvard Law
Review, pp.810-889.
6 . Jim Tan Tee and Loon Ng-Loy Wee Intellectual property law [2012] Singapore
Academy of Law Annual Review of Singapore Cases, (Annual Review 2012), pp.362.

dominance has been found with the extensive evidence that has been required for these findings. There
has to prove allegations of an abuse of a dominant position that the party is dominant. This can be use
in market share and market power of dominance. Market power has the ability of an organization to
behave in a manner that does not take into account the reactions of its competitors suppliers and
consumers to control prices 7. There must be the proper evidence that the party and organization is
abusing its dominance power. Abuse of a dominant position is when an organization holds a dominant
position on a certain market uses that position enforce certain conditions which affect to an
organization in several ways in the market. There are the actions which constitutes abuse are limiting
products and market development, directly and indirectly imposing unfair purchase and selling price. It
also includes making the conclusion of contract subject to acceptance by the party and applying
dissimilar conditions to equivalent transactions with trading parties 8.
Circumstances in which compulsory license be grant by court
Compulsory license provides that the owner of the copyright and patent licenses the use of their
rights against payment which is set by law. By compulsory license an individual seeking to use another
intellectual property can do so without seeking the right holder's consent and pay the fees for it. This is
an exception of the exclusive rights of the owner. Copyright law provides for compulsory licenses of
copyrighted works for specific uses. In many cases the remuneration received for a copyrighted work
under compulsory license which are specified by local law there is also the negotiation 9. It can
established through negotiating licenses that provide terms within the limitations of compulsory
license. It also provides the owner of copyright which have the exclusive rights under copyright law.
Patent law systems provide for the granting of compulsory license in various situations. The
availability of compulsory license in patent that has been the subject of considerable attention 10. In UK
7 . Brown Christopher. Developments in Intellectual Property Law [2011] Ind. L. Rev.45.
pp.1243.
8 . Fromer Jeanne. Expressive Incentives in Intellectual Property [2012] Virginia Law
Review, pp.1745-1824.
9 . Kelbrick Roshana and Visser, Coenraad. Intellectual property law [2010] Ann. Surv. S.
African L.. pp.754.
10 . Epstein Richard. The disintegration of intellectual property? A classical liberal

patent act 1977 provides the circumstances where patent can be established there has been an abuse of
monopoly rights in relation to such patent. It is rarely apply in UK because there are more effective
provisions for controlling abuse of monopoly in competition law. Compulsory license can be defined as
a authorization by government to a person for abuse the patent without the consent of owner. This is the
work which is against the interest of the owner of patent but it considered as a necessity in certain
situations as health crisis, national emergency. Grant of compulsory license on patent are the reasonable
requirements of the public with respect to the patented invention have not been satisfied and patent
invention is not available to the public at reasonable affordable price 11. If one of the ground of
compulsory license is established the comptroller can order the grant of license on such terms as it
decides the patent license of rights.
Technology Transfer Block Exemption Regulations
In European and domestic competition law anti- competitive agreements are prohibited. That is
anti-competitive provisions in commercial agreements are void and unenforceable by law. European
commission, competition and market authority have a right to fine the companies. Breach of the rules
has result in significant damage an individual has been disqualified from the positions 12. All contracts
have to be evaluated by the new technology transfer block exemption but it is particularly relevant to
the life sciences. This agreements dealing with the license of intellectual property rights such as patents
entitle the holder to prevent unauthorized use of the protected technology and will exploit it. Exclusive
right of exploitation does not exempt intellectual property rights by competition law. Holder of licenses
are another undertaking to exploit its intellectual property rights 13. intellectual property rights and the
EU competition rules both follow the same basic objective of promoting consumer welfare and
efficient allocation of resources. In order to simplify the assessment of conformity with the European
competition rules which set out the various block exemption regulations14. In case and agreement
fulfills all the criteria of block exemption it is prohibited under the law.
response to a premature obituary [2010] Stanford Law Review. pp.455-521.
11 . Cornish, William. Llewelyn, Gordin Devid. and Aplin, Tanya. 2013. Intellectual
property: patents, copyright, trade marks & allied rights.
12 .Torremans Paul. Holyoak and Torremans. intellectual property law [2013] Oxford
University Press.
13 . Vaver David. Intellectual property law: copyright, patents, trade-marks. [2011]

The new technology transfer block exemption regulation not only relevant to license
agreements but in the settlements also. It follow the disputes of technology is correctly patented and it
can be infringed. It is provided for transitional period where agreements will exempted with the
provisions of new technology transfer block exemption regulation.
14 Brown Christopher. Developments in Intellectual Property Law [2011] Ind. L. Rev.45.
pp.1243.

Difference between horizontal and vertical licensing agreement
The vertical agreement is usually take place between manufactures and retailers for
suitability. This agreement is also helps in supplying of goods and services. . Generally, the
features of the vertical license are that it authorise the product by distinct identity because it
approved after various investigation15. It also provides freedom to retailers to take risk and to
trade according to their means. There are production of some benefits too, even in the situation
where vertical agreement does not fall under block exemption or UK Exclusion order. Under
competition law, there are many type of restraints exist which limit competition in the potential
market. This agreements need to be evaluated on the basis of case by case. on cThe constraints
which restrict the market competition have some impact also such as it control as it control, and
it prevent market players to compete as well as it creates obstruction in performance. a
Another one is horizontal agreement or it can be assumed as horizontal cooperation it can
be defined as a practice between two or more existent and latent competitors. The real meaning
of this agreement is to split the market and allocation of consumer16. It is more incidental to
illegal activities and sometimes it harms the market by fixing the price of the products. It is
related to the following type of harm which affects the market by directly or indirectly fix
acquisition charges or fixing marketing prices, share industry or by finding the root of economic
process. and by limiting and controlling industry and market.
15
Furukawa Yuichi. Intellectual property protection and innovation: An inverted-U
relationship [2010] Economics Letters 109(2) Pl.99-101.
16 Ockwell David Ruediger Haum Alexandra Mallett and Jim Watson. Intellectual property
rights and low carbon technology transfer: Conflicting discourses of diffusion and development
[2010] Global Environmental Change 20(4) Pl.729-738.

There is significant difference between both which creates distinct identity of vertical and
horizontal licensing agreements. Under horizontal, there is common cooperation which includes
subject matter exchange, joint purchasing statement and research and evolution
correspondence17. Further, under vertical agreements there are level play system is effective as
well as supply of goods and services and distribution process.
17
Dinopoulos Elias and Paul Segerstrom. Intellectual property rights multinational firms
and economic growth [2010] Journal of Development Economics 92(1) Pl.13-27.
7

IMS Health v Commission
The case is concerned with the dispute between IMS health and NDC health. The
judgement is announced by European communities. It is related with the following kind of
matter which both are concerned with providing data on gross sales of pharmaceutical products
in Germany18. IMS health has its own identification regarding selling this products and it have
self formatted the structure of 1860 or 2847 bricks which symbolise the particular geographical
area. This artifice is made by IMS in cooperation which became a standard for IMS health to the
coverage sales collection. But in year 2000, it was found that it certain challengers including
NDC health were utilising it copyrights for increasing the customer value. Therefore IMS health
filed a petition to the European commission regarding Article 82 EC that commission gave
decision in favour of NDC health and it should grant permit to NDC. After disagreement with the
decision of ECJ, the final judgement is made by the president of European commission with
respect of taking consideration regarding input requirement of holder of intellectual property.
The whole case is representing the element of abuse in dominant market which occurred
due to wrongfully utilisation of other's licensing premises as copyrights, trademark or brand
name. This abuse raised by other market participant who took another licensed or approved
possessions to gain profit or increase the number of customer19. It is generally done to influence
the market position of an entrepreneur or businessman and the structure of a market. It affects
competition in industries and also exploits customers by misguiding them. The another case is
18
Branstetter Lee Ray Fisman and Kamal Saggi. Does intellectual property rights reform
spur industrial development? Journal of International Economics 83(1) Pl.27-36.
19 Sell Susan. Revenge of the Nerds: Collective action against intellectual property
maximalism in the global information age [2013] International Studies Review 15(1) Pl.67-85.
8

Hoffmann La Roache v, Commission which is rendering the same abusing factors in legal
proceeding.
Bronner v Mediaprint and indispensability test
This case raised under the doctrine of essential facilities. It is described as specific kind
of assertion of monopolization which is made under competition jurisprudence. The issues
related to the legal doctrine of indispensable profit are generally personal or unregulated20. There
are some necessary elements which ensure the liability under this kind of benefits which are
particularly control by the monopolist of necessary installation, disaffirmation of using this
facility by competitor and practicability of supplying the facility.
The indispensable test is connected with the doctrine of essential benefits. This test is
undertaken to clarify and verify the terms that market is actually influenced by the competitors
who restarting well the growth of well settled companies. The court of made it clear in Bronner
case that relevant stimulus or input is important when refusal of that input decrease the
competition in market and made industry feasible. Under this margin squeezT is generally
viewed as an example of denial to supply. Under the Bronner case first argument was that, his
point of view deal with only outright subject matter of supply. Here Bronner judgement was
irrelevant and did not clench the conditions for a denial to supply. Therefore, the courts
conclusion was that the question was not self-addressed because it was not according to the case.
Further, it also presented that any conduct of a governing company related to terms of trade will
be matter of abuse of content.
The another significant judgement of court is that it is not suggesting indispensability
status, which is limited to implicit denial of supply like an example if owner of gas pipeline
supply a certain percentage of it capacity but the supplier denied to give because competitor
demanding greater share21. Here the gas pipeline was actual indispensable.
20 Harriss and Greg Atkinson. Update–ethical standards in sport and exercise science
research [2011] International journal of sports medicine 32(11) Pl.819-821.
21 Lin Chen Ping Lin and Frank Song. Property rights protection and corporate R&D:
Evidence from China [2010] Journal of Development Economics 93(1) Pl.49-62.
9

In every case, in which indispensability in not essential condition to find out an abuse itis not a
not relevant factor.
Magill case and exceptional circumstances
In this given case of Magill there is main focus is on abusive use of intellectual property. The
meaning of intellectual property is that creation of innovative things by the use of unique ideas
and power of creativity to earn recognition and position in the market place22. The example of IP
is copyright, trademark and patent.
The facts related to Magill case is that he wanted to produce an Irish guide to all channels
but the three broadcaster BBC, ITV and Irish state broadcaster denied to give license and
certification to Mr. Magill. Therefore he complained to the European commission. Here the
judgment was made by the commission is that, the three broadcaster dominating their position by
not granting license to him to reproduce weekly database23. After that the commission give their
opinion as it was duly breach of Article 86 and also prevention of particular listing which for
consumer demand is exist is violation of this article.
Magill decision was of great importance to holder of intellectual property rights not only
copyright, trademark and patents but also designs. The rights are allocated to protect the research
and creativity of the person. This case is still unanswered because it has some exceptions and it
will only applicable in the exceptional circumstances. Because under this case the broadcaster
has the only right to decide weather they want to allot license or not .it basically depende upon
the discretion of holder of the intellectual property. Hence this is puzzled case coming under
exceptional circumstances. The Article 86 and the Treaty of Rome is clearly underlined the
judgment of Magill as it is matter of concern to holder of IPR that a denial of license is never a
classically insulting activity.24 The abusive behavior is consist of price fixing, stealing name of
22 Shawqi Naji Jawad and Nick Bontis. Intellectual capital and business performance in the
pharmaceutical sector of Jordan [2010] Management decision 48(1) Pl.105-131.
23 Torremans Paul. Holyoak and Torremans intellectual property law [2013] Oxford
University Press.
24 Branstetter Lee Ray Fisman and Kamal Saggi. Does intellectual property rights reform
spur industrial development? Journal of International Economics 83(1) Pl.27-36.
10

other famous company. The conclusion is drawn as there is no specific judgment can be made
regarding Intellectual property rights because it basically depend upon the decision of the holder
of rights. Otherwise it will apply in exceptional circumstances.
Judgment ECJ in IMS
ECJ Is the highest court in the European union. In this case ECJ receive appeal from the national
court which is related to infringement of the intellectual property right.
ECJ order in legal case of IMS action is that court reviews mandatory licence as proper
compensation for infringement of Article 82 which state that some conditions are met, even in
lawsuit relate brand-new industries, it main purpose to encourage the research and
development25.
This action of Microsoft are goes to the EC courts existence such a case. In case of EC
courts agreed with the Commission that Microsoft’s denial license the ability information
impedes the occurrence of a new commodity, need any objective organisation justification, and
excludes all competition in alternate, down- stream market, the courts will continue the
Commission’s obligatory instrument order in this legal proceeding
the court of European commission (ECJ) ruled that the refusal on the basis of IMS in a controlled
the position to grant a licence for purpose of copyright may only represent an ill-usage of a
controlling position if it prevents the exposure of a new commodity or service for which there is
new demand, is without objective justification and is capable of eliminating all competition on
the relevant mark
Decision of the CFI in Microsoft
In this decision the CFI reject the appeal which made by Microsoft against EC decision
because commission found that Microsoft's abusive their position26. Thus, CFI found that
Microsoft's fail to the complied with Article 82 worth of its denial to grant data and creation of
Windows Media Player in Windows PC operating system. Therefore, the CFI charged the penalty
25 Fawcett James and Paul Torremans. Intellectual property and private international law
[2011] Oxford University Press.
26 Bently Lionel and Brad Sherman. Intellectual property law [2014] Oxford University
Press USA.
11

€497 million for such misleading activities that is too higher. Further, the CFI summaries all the
area and observe that the execution for the appointment of a observation trustee was illegal27.
Therefore, is not give authority to commission to compel Microsoft's monitoring trustee power.
Hence, commission has no authority itself to confer on the third party.
Apple v Samsung
In the year 2011 apple filed the suit against the Samsung for infringement of tree apple
infringement and four design patents. The patent is treated as government grant provided for fulf\
of specifically purpose28. Apple registered their invention in international property right act
which gives possible help for 20 year. But Samsung infringement design of the apple and sell
there their product in the open market.
The Samsung infringed utility patent is as followed
Patent 163 it is related to touch zoom in document, image when user tab the screen.
Patent 381 patent defend the ability of the iPhone to bounce the surface back when a user scrolls
beyond the limits of a page edge
Patent 195 it is related to pinch to zoom capability where user can zoom the screen by one
figure.
Samsung infringement in design patent.
Patent 087 related to back part of iPhone which slimier as iPhone back design.
Patent 305 relates to shape of iPhone menu icons
Patent 677 related to front structure of the iPhone.
Patent 889 related to the overall structure of the iPhone devices.
27 May Christopher. The global political economy of intellectual property rights: The new
enclosures?[2013] Routledge.
28 Bently Lionel and Brad Sherman. Intellectual property law [2014] Oxford University
Press USA.
Fawcett James and Paul Torremans. Intellectual property and private international law
[2011] Oxford University Press.
12