UK Government's Response to SEP Licensing Consultation

Whitehall

Author: Tbmurray, Licence: CC BY 3.0,  Source: Wikimedia Commons

Jane Lambert

On 15 July 2025, the British government launched a consultation on SEP licensing, which I discussed in Latest Consultation on Standard Essential Patent Licensing on 18 July 2025.  The consultation received 93 replies, which the government has now considered.   It published its response on 13 Oct 2026.

The Problem

To facilitate the development and distribution of new electronic products, standard setting organisations ("SSOs") such as the European Telecommunication Standards Institute ("ETSI") or the International Telecommunication Union Telecommunication Standardisation Sector (ITU-T) establish technical standards to enable different manufacturers' devices to work together using the latest technology. Often, such standards require businesses wishing to implement them ("implementers") to use patented inventions.  Patents for inventions that are believed to be essential for the implementation of a technical standard are known as standard essential patents ("SEPs").  

Not unreasonably, SEP owners wish to charge implementers a licence fee or royalty for the use of their inventions.  ETSI requires SEP owners to license their patents on fair, reasonable and non-discriminatory ("FRAND") terms.  Before paying anything to SEP owners, implementers wish to make sure that a SEP is valid, that compliance would infringe and that the SEP really is essential to the standard.  Implementers may also disagree with SEP owners over whether the terms of a licence really are FRAND.

Until now, the courts have resolved disputes between SEP owners and implementers, but litigation is notoriously expensive.  Costs have been saved by dispensing with proceedings to determine the validity and essentiality of a SEP and whether it has been infringed, known as "technical trials".  Nevertheless, FRAND litigation is well beyond the means of all but the largest companies.

Proposed Solutions

In its consultation document, the government offered some very interesting proposals such as a "Rate Determination Track" in the Intellectual Property Enterprise Court (IPEC) to supplement the existing Small Claims Track and Multitrack as "a simpler and more efficient approach to proceedings to determine the correct licence rate, a pre-action protocol for FRAND disputes and an essentiality checking service by the Intellectual Property Office or some other entity.

Response

In the consultation outcome Government response to the consultation on Standard Essential Patents the government abandoned its proposed Rate Determination Track for IPEC as there was little support for the proposal but decided to explore other methods of dispute resolution such as early neutral evaluation and an extension of the IPO opnion service to FRAND issues.  There was more support for a pre-action protocol or more effective pre-action exchange of information and evidence.   In this regard, the government will encourage voluntary disclosure of standard related patent information to the IPO but there was little demand for essentiality checking.

Further Information

Anyone wishing to discuss this article of FRAND generally may call me on +44 (0)20 7404 5252 during UK office hours or send me a message through my contact form at any time.