Does Asymmetry Cause Anti-Competitive Practices?

by Iona Stephan PhD, Assistant Professor of Innovation Management, Mälardalen University, School of Innovation, Design and Engineering, Sweden and William Bird, European, British and German Patent and Trademark Attorney and LLM Professor University of Brussels (ULB), Belgium

Typically the licensing of IP such as patents or trademarks is controlled by a license agreement. Although in western democracies there is great freedom to determine the clauses of such a contract, basic contract law and antitrust or unfair competition law may restrict the details of such a contract. There is, however, a concern that anti-trust or unfair competition law is complex and inadequate to deal with certain business practices, particularly, relating to the negotiation and enforcement of terms of licensing contracts resulting from a gross economic imbalance between contractual partners. This can happen particularly in asymmetric partnerships/ negotiations involving small and/or young firms (e.g. spin-offs, spin-outs, start-ups, SMEs), and larger organizations (e.g. multinationals). Click here to read the whole article.