An Analytical Study of Interface between Patent Pooling and Competition Laws in India

Abstract

The object of this article is to assess the anti-competitive and pro-competitive effects of patent pooling in light of the competition laws in India. This article also attempts to analyze the interrelation between patent pooling and the legal validity of the same in view of the provisions of the Competition Act, 2002. As patent pooling is a nascent concept on the Indian jurisdiction, there is need for a critical analysis as to how the patent pooling arrangements shall prevail under the Indian antitrust legal structure. Patent pooling may entail numerous economic benefits to the consumer in terms of ease of access to essential goods and also increased competition in the market, however, in absence of adequate regulations the same can also give way to collusive and anti-competitive behavior between horizontal firms competing in the market. Patent pools can also be a case of cross-licensing of patents between horizontal players by way of an agreement which is per se anticompetitive under the competition laws in India. In the light of the above statement, application of the per se rule will be deemed to be inappropriate because of the economically beneficial and pro-competitive effects of patent pools. This article evaluates such effects of patent pooling on competition in the market. The article concludes by stating that patent pooling although not being prima facie anticompetitive in nature, it can be consequentially anti-competitive and adequate guidelines in respect of patent pools are necessary to ensure that the economic benefits are well received and the competition in the market in not diminished to the detriment of the consumer.