Comparative Study of Interfacing Jurisprudence: Chapter-III

Chapter-III
COMPARATIVE STUDY OF INTERFACING

JURISPRUDENCE
Under this chapter attention has been given to analyze the anti-trust law
approach and practices relating to IPRs exclusively in EU, US, UK and India in order
to find out the common issues of the interface and differences. Apart from it a critical
evaluation has been conducted in relation to the experiences of the said jurisdictions
in grappling with the problems of reconciling the two systems and dealing with
interface disputes.
3.1 EVOLUTION AND GROWTH AT REGIONAL LEVEL
3.1.1 EUROPEAN UNION (EU)
Historically there was a period when the misunderstanding of the economic

effects of IPRs led EC competition polity to attempt to place overly strict limits on the
exercise of IP rights particularly in the field of patent licensing. Today, however, EC
competition policy treats the economic effects of IPRs realistically. It no longer
assumes that the legal monopoly conferred by IP laws, such as patent and copyright
legislation, to make and sell a particular product or process automatically amounts to
an economic monopoly or even confers market power. Its view is that this issue must
be left to be established empirically. Equally importantly, EC competition law gives
explicit recognition to the positive contribution that IPRs make to competition as well
as innovation and has made a number of significant adjustments within its doctrines to
accommodate the exercise of IPRs. The EC ‘immunity’ is offered 1 on occasion in the
form of an ‘exceptional circumstances’ test for IP protected products. More of an
accommodation within the general doctrines of competition law, as interpreted by the
Community Court judges and by the regulations, guidelines and notices issued by the
Directorate General of Competition within the European Commission. A close
reading of the case law together with these regulations and notices suggests that EC
1
Steven D. Anderman (2007), The Interface between Intellectual Property Rights and
Competition Policy, University of Essex, p.53.
Comparative Study of Interfacing Jurisprudence
competition law, in its own way, gives an extensive, albeit limited form of immunity
to the exercise of IPRs.2 Underlying this judicial and administrative accommodation
is the extensive recognition given by EC competition law policy to the contribution
that IP laws make to innovation and competition. In the first place, it is now openly
accepted that the incentives to innovation created by IPRs produce new competitors
on existing markets and indeed create new products which open up entirely new
markets. Secondly it is presumed that the licensing of IPRs is in general pro-
competitive as well as pro-innovative in its effects and helps to ensure that IPRs are
more widely diffused throughout the common market. IP licensing also adds new
products to markets which either add new competitors to existing markets or form
new markets. The EC competition authorities also acknowledge that too heavy a
regulatory burden on the exercise of IPRs could discourage investment in IPRs are
used unjustifiably by their owners to exclude competitors from markets, EC
competition policy reserves a right to intervene to limit their exercise. It tends to view
intellectual property rights as any other form of private property rights at this point
and to restrict their use when that use amounts to prohibited conduct under the rules
of competition law. This can apply to the unilateral exploitation of an IPR by its
owner as well as to an agreement between the IP owner and a licensee to exploit the
IPR in a particular territory. Today, in fact, there are four main spheres in Which EC
competition policy may be said to intervene in extreme cases.
First, competition policy under Article 102 of the Lisbon Treaty has, in
extreme cases, been used to restrict the abusive commercial conduct of individual
owners of IPRs, particularly where the IPR protects a market excessive pricing3, but
has been more frequently focused on the IPR holder’s conduct towards innovators
who are ‘downstream’ of an IPR protected industrial standard including refusals to
deal, refusals to license, refusals to provide proprietarily software interface codes and
tie-ins.
2
Sara M. Baggers, Richard A. Mann and Barry S. Roberts, “Intellectual Property and
Antitrust: A Comparison of Evolution in the European Union and United States”, Hastings
International and Comparative Law, (1999).
3
United Brands v. Commission [1978] ECR 2017.
Page | 90
Secondly, competition policy regulates certain terms of bilateral IPR licensing

agreements, i.e. technology transfer agreements, under Article 81(now article 101 of
the Lisbon Treaty) of EU Treaty, and a block exemption regulation.
Thirdly, competition policy regulates cooperative relationships between

competitors in joint ventures and multilateral agreements including patent pools,
multilateral cross-licensing agreements and standardization agreements4. Finally, in
the context of mergers, competition policy has intervened on occasion to limit IPR
owners from acquiring competing technologies5 as well as requiring compulsory
licenses as a condition of merger approval.
The role of Article 102 of the Lisbon Treaty in the system of EC competition
law is to regulate undertaking usually individual undertakings but occasionally two or
more undertakings, usually individual undertaking but occasionally two or more
undertaking acting jointly , which have been found to occupy positions of dominant
market power, such as monopolies or near monopolies, Its aim is not merely to
prohibit ‘exploitive’ pricing or limitations of output which are the more traditional
methods of monopolists. It is also concerned with the use of market power to damage
effective competition in markets by preventing access to markets or driving out
existing competition. Unlike Article of 1016 of the Lisbon Treaty which prohibits
cartels and other agreements that could disrupt free competition in the European
Economic Area’s common market, Article 102 of the Lisbon Treaty only regulates the
conduct of undertaking which have already achieved market dominance. If a firm falls
4
S. Anderman and J. Kallaugher, Technology Transfer and the New EC Competition Rules:
Intellectual Property Licensing after Modernisation, Oxford University Press, (2006).
5
Tetra Pak Rausing SA v. Commission (Tetra Pak) (1990) ECRII-309.
6
Article 101 of the Treaty of Lisbon states : The following shall be prohibited as incompatible
with the internal market: all agreements between undertakings, decisions by associations of
undertakings and concerted practices which may affect trade between member States and
which have as their object or effect the prevention, restriction or distortion of competition
within the internal market, and in particular those which:
(a) directly or indirectly fix purchase or selling prices or any other trading conditions;
(b) limit or control production, markets, technical development, or investment;
(c) share markets or sources of supply;
(d) apply dissimilar conditions to equivalent transactions with other trading parties,
thereby placing them at a competitive disadvantage;
(e) make the conclusion of contracts subject to acceptance by the other parties of
supplementary obligations which, by their nature or according to commercial usage,
have no connection with the subject of such contracts.
Page | 91
below the threshold of dominance (and is not part of a collectively dominant

position), it is not affected by Article 102. The framework for the rules regulating
undertaking in a dominant position is established by the general prohibition in Article
102 of the Lisbon Treaty:”Any abuse by one or more undertaking of a dominant
position within the common market or in a substantial part of it shall be prohibited as
incompatible with the common market insofar as it may affect trade between Member
States.”
Article 102 of the Lisbon Treaty then goes on to list four examples of abuse7.
The analysis of abuse under Article 102 of the Lisbon Treaty involves three stages:
First the ‘market’ in which the alleged abuse occurred must be defined.
Secondly, there must be a determination of whether or not the firm allegedly

committing the abuse was ‘dominant’ in a market; shatter or not it is in the marked in
which the abuse occurred.
Thirdly, the conduct complained of must be analyzed to determine whether or

not an ‘abuse’ was committed.
From the IP perspective, it is worth noting at the outset that a legal monopoly
created by a patent or other IPR is not assumed by EC competition law to confer
market power or dominance. There must be hard evidence that the actual market share
of a product, whether or not protected by an IPR, actually reflects significant market
power amounting to a dominant position. Moreover, under the prohibition of Article
102’s concept of legitimate competition is recognition of innovative efficiencies
brought about by investment in research and development and IP protection. Even if a
firm creates an economic monopoly in a product or a group of firms create an
industrial standard, and this is propped up by possession of an intellectual property
right, this as such does not constitute abusive conduct. Under Article 102 of the
7
Such abuse in particular may consist in:
(i) directly or indirectly imposing unfair purchase or selling prices or unfair trading
conditions;
(ii) limiting production, markets or technical development to the prejudice of
consumers:
(iii) applying dissimilar conditions to equivalent transactions with other trading
parties, thereby placing them at a competitive disadvantage.
Page | 92
Lisbon Treaty confers upon dominant firms, whether IP protected or not, a position of
‘special responsibility’ not to use their dominant market power anti competitively to
further weaken the already weakened state of competition markets caused by their
dominance8. However, a dominant firm may continue to compete against competitors
as long as it only uses means which are ‘competition on the merits’. Hence, in
principle, it may continue to use its superior efficiencies created by its investments in
R & D and the normal exercise of its intellectual property rights to reduce the market
shares of competing firms by pricing products based on its lower total costs created by
productive and other efficiencies. On the other hand, the concept of abuse has been
defined by European Court of Justice (ECJ) judgments to ensure that a dominant firm
may not use its market power unfairly either to exploit consumers or to den
competitor’s access to markets which are affected by its dominant market power.
These rules can apply irrespective of whether or not the market power of the dominant
firm is propped up by an IPR. Where an IPR reinforces a dominant position, the rules
of abuse make certain significant concessions to the exclusionary rights of the IPR
owner, the logic of Article 102 of the Lisbon Treaty requires two specific points to be
established. Firstly, when does the ownership of an IPR coincide with, or place a
company in, a dominant position in a particular market? Secondly, in what situations
will the use and exploitation of an IPR by a dominant company create an abuse of a
dominant position? If the mere ownership of an IPR, even one which has become an
industrial standard, is seen as non abusive and a form of legitimate competition, when,
if ever, will the exercise of an exclusive right amount to an abuse of a dominant
position? These questions still remain unanswered and probably in a near future the
courts will come up with an appropriate answer.
3.1.2 Association of South-East Asian Nations (ASEAN)
The ten countries forming part of the ASEAN namely : Brunei. Darussalam,
Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand,
Vietnam are at various stages of development and of these only Indonesia, Singapore,
Thailand and Vietnam are at various stages of development and of these only
8
P. Tandon, “Optimal Patents with Compulsory Licensing”, Journal of Political Economy,
Vol 90 No.3, (1982), pp. 470-86.
Page | 93
Indonesia, Singapore, Thailand and Vietnam have at present economy-wide

competition policy and competition regulatory bodies (CRBs).9 Cambodia, the Laos
PDR and Malaysia intend to introduce nation-wide competition policy and CRBs.10
The reluctance of governments to introduce competition law is that it conflicts with
the strategy of economic development that they have adopted. Most of the countries
have evolved from a communist, socialist, authoritarian, feudal or colonial past and
state intervention in the economy is quite pervasive. Their experience is in managing
mixed economies as most governments have to be concerned with distributional
issues because of the need to avoid social unrest and political turmoil.
The ASEAN nations are more and more realizing the significance of
intellectual property rights. There is growing recognition that piracy and
counterfeiting have a cost. They deprive ASEAN nations of licensing income, lower
production, reduce trading and investment opportunities, and interfere with the
attraction of much-needed foreign investment, innovation, and technology transfers.
Strong, fair, and effective ASEAN intellectual property laws will stimulate foreign
investment, technology transfers, and ASEAN success in the global trading system11,
and offer long-term benefits of enhanced employment, economic development, and
innovation.
The TRIPs Agreement builds on and works in conjunction with existing

international treaties, requiring all WTO members to follow the Berne and Paris
Conventions, and the Washington12 Treaty on Intellectual Property in Respect of
9
‘ASEAN Member State’, available at http://www.aseansec.org/,last accessed 21/03/2011.
10
Ms. Thitapha Wattanapruttipaisan (ASEAN) Directorate For Financial and Enterprise
Affairs Competition Committee, “Global Forum on Competition, State Aids and Subsidies”
available at http://www.oecd.org/dataoecd/206/44558467.pdf, last accessed 21/03/2011.
11
High levels of intellectual property protection and certainty are important prerequisites for
many companies in determining whether and where to do business, invest, or engage in
technology transfers.
12
Long before the TRIPS Agreement, the Paris Convention for the Protection of Industrial
Property, 828 U.N.T.S. 305 (1883, as revised 1967) hereinafter Paris convention), and Berne
convention for the protection of literary and artistic works, 828 U.N.T.S. 221 (1886, as
revised 1971 and amended 1979) [hereinafter Berne Convention], began to establish
minimum rights for intellectual property protection. The TRIPS Agreement does not require
WTO members to implement Berne’s moral rights provision.
Page | 94
Integrated Circuits.13 In addition, the TRIPs Agreement requires detailed

administrative, civil and criminal remedies to protect individual right holders14 and is
the first multilateral intellectual property agreement that is enforceable between
nations in dispute settlement proceedings.15 National and Most Favoured Nation
Treatment16 are also required. Developed countries were obligated to implement
national treatment and Most Favoured Nation Treatment by January, 1, 1996. The
TRIPs Agreement recognizes that others need technical assistance and expertise to
comply fully17. Developing countries and countries in transition from centrally-
planned to market economies must implement the agreement by 2000 and by 2005,
for previously uncovered patent protection.18 Thailand, Indonesia, the Philippines,
Malaysia, and Brunei are classified as developing countries. Singapore is likely to be
classified as developed and is already in substantial the TRIPs Agreement
compliance.19 Vietnam, though a non-WTO signatory, is obligated by the ASEAN
Framework Agreement to comply with the TRIPs Agreement. It is considered both a
developing country and a nation in transition.
13
Washington Treaty on Intellectual Property in Respect of Integrated Circuits, 28I.L.M. 1477
(1989) TRIPS Agreement arts. 41-61.
14
TRIPS Agreement arts. 1(3), 2(1), 9(1).
15
Though the Paris and Berne Conventions supra note 46, establish minimum levels of
intellectual property protection, they lack enforcement mechanisms.
16
National treatment obligations require members to provide treatment to national of other
members no less favourable than that accorded to their own nationals. Most favoured nation
obligations require members to accord to other member the advantages, favours, privileges,
and immunities relating to the protection of intellectual property granted other nations. See
TRIPS Agreement arts. 3 and 4. Customs and free-trade area exclusions permit lowered tariffs
on wide categories of intra ASEAN merchandise and the ASEAN-Free Trade Area (AFTA)
planned by 2008. see GATT art. XXIV. See also ASEAN Free Trade Area, Flashfax
Information Series, Doc. 2008, I (Sept. 1995.)
17
TRIPS Agreement arts. 65 and 66.
18
Least developed countries are given still longer transition periods. see TRIPS Agreement
art. 65.
19
UNCTAD, The Least Developed Countries: 1993-1994 Report X (1994). Singapore, one of
Asia’s four tigers, prefers to reap the benefits of being classified as developing but the United
States and Europe now recognize it as developed because of its substantial gross national
product and recent economic growth.
Page | 95
3.1.3. East African Countries (EACs)

Competition law and policy are relatively new disciplines in Tertiary
institutions in southern and eastern Africa and in some countries they do not feature at
all. This is an area where the interdisciplinary nature of the challenges encountered in
enforcement requires very specific legal and economics training20. The interface
between competition policy and IPR is visible as the African countries face a dilemma
that if not reasonably resolved could threaten the access to essential medicines. On the
one hand countries need to protect their populations against potentially harmful
counterfeit medicines, and to protect producers against unfair competition. On the
other hand, the laws and measures that do this should not act as a barrier to cheaper,
generic medicines. The current proposals for laws to protect against counterfeits in
east Africa seem to be excessively weighted towards protecting intellectual property
at the cost of access to legitimate generic versions of medicines.
There seems to be no being universally accepted definition of ‘counterfeits’.

This has caused confusion and created a loophole in determining what a counterfeit
product is. The World Health Organization (WHO) has defined a counterfeit medicine
as: ‘one which is deliberately and fraudulently mislabeled and generic products and
counterfeit products may include products with the correct ingredients or with the
wrong ingredients, without active ingredients, with insufficient active ingredients or
with fake packaging.21
This definition makes the element of fraud essential in Defining a counterfeit

medicine, either in relation to the identity or the source or the product. WHO points to
the public health risk of using products that has the wrong ingredients or which lack
active ingredients.
From an intellectual property perspective, counterfeits are defined in Article

51 of the Trade Related Aspects of Intellectual Property Rights (TRIPs) Agreement
which limits the definition of counterfeits to trademark and copy right
20
Tenu Avafia, Jonathan Berger and Trudi Hartzenberg, “The ability of select sub-Saharan
African countries to utilize TRIPs Flexibilities and Competition Law to ensure a sustainable
supply of essential medicines: A study of producing and importing countries”, ICTSE,
UNCTAD and Tralac, 2006.
21
‘Definition of counterfeit medicine’ available at
http//www.who.int/medicines/services/counterfeit/overview/en,last accessed on 23/03/2011.
Page | 96
infringements.22 This definition refers to only one aspect of intellectual property that
is trademarks, and associates counterfeiting with the issue of trademark infringement.
In their efforts to address counterfeits, East African countries are enacting and
counterfeiting legislation. Kenya has a law in place; Tanzania has regulations while
Uganda has a draft Bill. These laws have adopted a broad definition of counterfeits23
which go beyond the provisions of the TRIPs Agreement Article 51 above. It implies
that legitimate generic versions of medicines fall within the scope of counterfeits. The
provisions have thus raised deep concerns amount manufacturers and consumers of
generic drugs in low income countries as they effectively withdraw the flexibilities
provided in the TRIPs Agreement to produce and procure generic medicines for
public health reasons, and may thus den y patients access to safe and effective, high
quality generic drugs. Generic drugs are produced and distributed without patent
protection. They should contain the same active ingredients as the original
formulation and be tested to ensure that they are safe and effective. They are usually
available once the patent protections afforded to the original developer have expired.
However generic drugs can be available during the life time of a patent if national
laws provide for the TRIPs flexibilities, under which governments may issue
compulsory licences to purchase generic drugs if they are needed for public health
reasons.24 The provisions for compulsory licensing allow for exact copies of the brand
to be produced without the consent of the patent owner. Generic drugs made available
22
Under Article 51, Footnote 14 (a) of the TRIPS Agreement this counterfeit trademark goods
mean ‘any goods, including packaging, bearing without authorization a trademark which is
identical to the trademark validly registered in respect or such goods, or which cannot be
distinguished in its essential aspects from such a trademark, and which thereby infringes the
rights of the owner of the trademark in question under the law of the country of importation’.
Patrick F. J. Macrory, Arthur Edmond Appleton, Michael G. Plummer THE WORLD TRADE
ORGANIZATION: LEGAL, ECONOMIC AND POLITICAL ANALYSIS, VOL 1, 2005.
23
Section 2 of the Anti-Counterfeit Act in Kenya provides that: counterfeiting includes
manufacture, production, packaging, re-packaging, labeling or making, whether in Keny or
elsewhere, of any goods identical or substantially similar to protected goods without the
authority of the owner of any intellectual property right (IPR) subsisting in Kenya or
elsewhere in respect of those protected goods…………..In relation to medicine, this includes
the deliberate and fraudulent mislabeling of medicine ingredients, have sufficient active
ingredients or have fake packaging.’
24
John N. Gathegi, “Intellectual property, traditional resources rights and natural law: A
clash of cultures” available at
htt://www.africainfoethics.org/pdf/African_reader/26%20ICIE%20Chapter%2019%page%20
179-185.pdf last accessed23/03/2011.
Page | 97
on under compulsory licensing are not counterfeits, as they are neither fraudulent nor
do they infringe trademarks. The proposed legislation on counterfeiting in many east
African countries does not recognize this.
For instance the law already enacted in Kenya (Kenya Anti-Counterfeit Act,
13 of 2008) and that being proposed in Uganda (Uganada Counterfeit Goods Bill
2009) require the consent of the intellectual property owner to produce a generic
version of the drug. This implies that should the manufacture of the generic drug. This
implies that should the manufacture of the generic drug take place without this
consent, then what is manufactured is a counterfeit. This requirement undermines the
States’ ability to use the TRIPs flexibilities and wrongly applies controls for
fraudulent medicines to producers of generic medicines.25
The TRIPs Flexibilities have been contested in the past as they bias trade law
towards social equity and away from corporate interests. The new counterfeit laws
open a new possibility for multinationals to limit the flexibilities. The East African
Community (EAC) is currently working on a policy and law on Anti-Counterfeiting,
Anti-Piracy and Other Intellectual Property Rights Violations, as a “robust legal
framework for the protection and enforcement of Intellectual Property Rights” in the
region.26 The technical inputs to this need to be adjudicated for the interests as they
are advancing. An imbalance in the focus on intellectual property to the cost of access
to medicines is precisely what motivated the TRIPS flexibilities, and the same
imbalance appears to be more flagrant.
Governments should ensure that their counterfeit laws continue to protect

gains through the TRIPs flexibilities and use these fully. For this, counterfeit laws
should be clear in their definitions and exclude any possibility of generic medicines
being covered by these definitions. Producers of generic medicines should not have to
apply for permission from the intellectual property when they are covered by
government compulsory licenses and provisions for parallel importation. Drug
regulatory authorities should also have a role in administration of proposed anti-
25
Ibid.
26
“Anti-counterfeiting laws and access to essential medicines in East and Southern Africa”,
available at http://www.cehurd.org/wp-content/uploads/2011/01/policy-bried-on-anti-
counterfeiting-Laws-in-ESA-Countries.pdflast accessed on 23/03/2011
Page | 98
counterfeit laws where this relates to determinations on counterfeit medicines. It is

important for countries in East Africa, and the region as a whole, to ensure that in
solving one problem they do not create another otherwise the harm caused by
communities in African countries not accessing essential medicines would be
enormous.
3.2 UNITED KINGDOM
The Competition Act, (CA) 1998 essentially brings UK competition law into
line with the EC model. The CA 1998 as a whole has to be interpreted in the light of
European competition law. A provision containing similar terms to Article 85 of the
Treaty of Rome27 prohibits agreements and concerted practices which prevent restrict
or distort competition in UK, unless they are exempted on UK grounds. 28 A provision
similar to Article 8629 of the Treaty of Rome prohibits abuse of dominant positions30
within the United Kingdom.31 In both cases, the requirement of an effect on trade
within the UK is substituted in the Act for that of an effect on trade between member
states of the EC.32
In the case of the Chapter I prohibition there is also a requirement that the
agreement, decision or practice is, or is intended to be, implemented in the UK, must
be analogous to the criterion for EC jurisdiction as identified by the European Court
in the Wood Pulp case.33 In short, the Competition Act extends prohibitions
equivalent to articles 85 and 86 of the EC law to situations in the UK.
27
Article 85 of the Treaty of Rome makes it illegal for companies to enter into agreements
that restrict or distort competition with the European Union, that is, by means of price fixing
or agreements over market share.
28
This is referred to as Chapter 1: Prohibitions in the UK Competition Act, 1998.
29
Article 86 also makes it illegal for a dominant firm of group of firms to exploit consumers.
30
This is known as the “Chapter II prohibition”) in the UK Competition Act, 1998
31
s.18 CA 1998
32
s.2(1)(b), 18(1) I.d
33
[1998] ECR 5193, [1988] 4 CMLR 901. In this case, A number of Finnish, Swedish,
American and Canadian wood pulp producers established outside the EC created a price
cartel, eventually charging their customer based within the Ec. On 19 December 1984, the
Commission issued a Decision 2 establishing several infringements of Article 85 of the Treaty
by the said agreements and concerted practices and imposing fines.
Page | 99
In the UK Competition Act, 1998 there are no express provisions dealing with
IPR as such. All agreements relating to intellectual property, and conduct involving
intellectual property, have to be looked at in the light of the Chapter I prohibition and
the Chapter II prohibition, on the same basis as any other agreements or conduct.
Where the agreement effects trade between EU Member States, Articles 101 and 102
of the Lisbon Treaty have also to be considered. If an assignment or licence of
intellectual property has or may have an appreciable anti-competitive effect on trade
within the UK or part of it, it could be caught by the Chapter I prohibition.
Holding an intellectual property right does not itself constitute an abuse of a

dominant position, even if it does indeed give the holder a position of dominance. 34 It
is the circumstances which will decide whether there has been an abuse. In general,
the grant of a licence in respect of intellectual property of nay restrictions under it is
normally considered under Chapter I and Article 101 of the Lisbon Treaty.
Nevertheless, the acquisition of an exclusive licence by a dominant company may be
abusive, and a company holding a dominant position may not in certain cases bye able
to rely on a Block Exemption.35
There have been a number of cases on the question of whether a dominant

company abuses its market power through its licensing strategy, such as its refusals to
34
Reed Smith (2009)- “A Guide to Competition Law in the UK”, available at
http://www.reedsmith.com/_db/documents/Guide_to_Competition
_Law_in_the_UK_August_2009.pdf. last accessed 23/03/2011.
35
A Block Exemption Regulation (BER) defines types of agreements which are compatible
with EU competition rules provided that the agreements meet the conditions laid in the
Regulation. In the absence of a block exemption, companies must assess themselves whether
their agreements are compatible with the EC Treaty’s ban on restrictive business practices.
The EC Commission has adopted some Block exemption Regulations relating to intellectual
property rights. These cover: Licensing agreements relating to patents, know-how and
software copyright; this is referred to as the Transfer of Technology Block Exemption;
Research and development agreements, and Specialisation agreements, i.e. agreements
entered into between two or more undertaking which related to the conditions under which
those businesses specialise in the production or products. These exemptions apply in the UK
and parties will be able to rely on the terms of these regulations to benefit from automatic
parallel exemption under the CA even where the licence agreement does not affect trade
between Member States. The Technology Transfer Block Exemption is targeted at agreements
which license technology, have pro-competitive effects and promote economic efficiency.
These benefits are seen to outweigh certain anti-competitive restrictions contained in the
agreement in questions providing that the market shares of the parties to the agreement are not
unduly high.
Page | 100
grant licences of fixing of unfair licence fees. Refusals to license may, in exceptional
circumstance, be an abuse, for example where it is claimed that access to the
technology is essential to enable other parties of compete in the market, or where the
emergence of a new product in a downstream market is prevented. Licence fees may
be unfair it they are intended to deter potential licenses or if they are wholly
disproportionate. Even the exercise of a legal right may in some circumstances be
found to constitute an abuse of dominance. For example, the misuse by a
pharmaceutical company of the rules and procedures relating to drug market
authorisations, with the aim of blocking entry by generics of parallel traders, has been
found to infringe Article 102 of the Treaty of Lisbon.36
In the light of recent case law37 the clauses in contracts limiting a society’s
ability to offer services to artists or authors outside their domestic territory are seen as
restrictive business practices and are prohibited, together with other concerted
practices.
The reciprocal representation agreements, where collecting societies enter into

agreements to collectively offer of a non-exclusive basis the repertoire of all of the
36
In its decision of 15 June 2005 (case COMP/37.507), the Commission fined Astra Zeneca
for misusing the patient system and the procedure for marketing medicinal products to block
or delay market entry for generic competitors.
37
The European Commission has adopted an antitrust decision prohibiting European
Collecting societies from restricting competition by limiting their ability to offer their services
to authors and commercial users outside their domestic territory. However, the decision
allows collecting societies to maintain their current system of bi-lateral agreements and to
keep their right to set levels of royalty payments due within their domestic territory. The
prohibited practices consist of clauses in the reciprocal representation agreements concluded
by members of CISAC (the “international confederation of societies of authors and
composers”) as well as other concerted practices between those collecting societies. The
practices infringe rules on restrictive business practices (article 81 of the treaty and article 53
of the EEA agreement). The commission decision requires the collecting societies to end
these infringements by modifying their agreements and practices, but not impose fines. The
removal of these restrictions will allow authors to choose which collecting society manages
their copyright (e.g. On the basis of quality of service, efficiency of collection and level of
management fees deducted). It will also make it easier for users to obtain licence for
broadcasting music over the internet, by cable and by satellite in several countries from a
single collection society of their choice. Antitrust: commission prohibits practices which
prevent European collecting societies offering choice to music authors and users available at
http://europa.eu/rapid/pressreleasesaction.do?refdrence=ip/08/1165& guilanguage=en, last
accessed on 23/03’2011
Page | 101
artists represented by the participating societies, continue however to be a legitimate

form of management.
3.3 UNITED STATES OF AMERICA
3.3.1 Development of Anti-trust Law
The Anti-trust law in United States is primarily rooted in the Sherman Act of
1890 and the Clayton Act of 1914. Under Section 1 of the Sherman Act,38 1890, some
agreements in the restraint of trade, such as price fixing cartels and market allocation
agreements are treated as illegal per se. Most agreements, however, are judge under
the rule of reasons39, which calls for evaluation of purpose, power and competitive
effects.40 Section 2 of the same Act prohibits conduct that ‘monopolizes, or attempts
to monopolize any part of trade or commerce’.41
The Clayton Act of 1914 declares that tying42, exclusive dealing43 and stock
merges44 are illegal The Clayton Act, 1914 offences (including price discrimination,
38
Section 1, Sherman Act, 1890- “Every contract, combination in the form of trust or
otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with
foreign nations, is declared to be illegal.”
39
The rule of reason implies that a fact based approach should be adopted for the purpose of
evaluating the reasonableness of the alleged anti-competitive conduct. It is in the form of
weighing the pros and cons of the purpose and eventual consequence of the conduct and if the
pro-competitive effects outweigh the anti-competitive harm, them the conduct is deemed
reasonable, Standard Oil Co. of New Jersey v. United States 221 U.S. 1 (1911)
40
Rudolf Peritz, The Interface between Intellectual Property Rights and Competition Policy,
edited by Steven Anderman, Cambridge University Press (2007), p.99
41
Ibid. However, under this provision, claims of monopolization and attempts to monopolize
are always judged under the rule or reason. Purpose is inferred from a limited set of conduct
identified as predatory, including certain pricing below cost and unjustified refusals to deal.
42
Tying involving IPR refers to the act of the IPR owner in licensing or exercising the right
by other means, force the licensee to accept the licensing of another IPR, or buy some kind of
products from the IPR owner or a third party designated by him or her. http://www.aief-
us.org/ipr/workship/presentatin/douglasclark.pdf, last accessed on 24/03/2011
43
In the intellectual property context, exclusive dealing occurs when a license prevents the
licensee from licensing, selling, distributing, or using competing technologies.
http://www.aief-us.org/ipr/workshop/presentatin/douglasclark.pdf, last accessed on
24/03/2011
44
A merger is the absorption of one company by another company, including all its assets and
liability., N. Sridhar, Strategic Financial Management for CA Final, (Shroff Publishers &
Distributors pvt. Ltd.:Mumbai), Ed 4th, p 1100.
Page | 102
mergers and exclusionary conduct) call for proof that the conduct under scrutiny may
substantially lessen competition.45
Section 5 of the Federal Trade Commission Act, gives the Federal Trade
Commission (FTC) broad latitude to attack “unfair methods of competition” and
“unfair or deceptive acts of practices”. Against the backdrop of anti-trust laws, there
seems to be a constant clash between individual’s inalienable right to property and the
general freedom of trade and commerce.
3.3.2 Interface between Anti-trust Law and IPR
The apparent tension between IPRs and anti-trust is subsumed under the
modern approach of treating IPRs and competition policy as complementary of each
other and the underlying theme is to strike an appropriate balance between the two.
Perhaps the most profound impact has been that the “innovation” economics, which
encouraged the anti-trust authorities to take a flexible and comprehensive view of
both intellectual property and anti-trust law. With the growing realization that
competition which matters most is the competition on merits and that “innovation” is
the key to sustained economic growth and consumer welfare, the anti-trust authorities
began to highlight the congruence between competition policy and intellectual
property rights, rather than the potential tensions between the two. This is explicit in
the antitrust guidelines jointly issued by the Department of Justice and Federal Trade
Commission which indicate that there is an inherent innovation nexus between IPRs
and competition policy.
The essence of these guidelines was to accentuate the nexus between

Intellectual Property Law and Competition policy. The fundamental precepts as
articulated by the Department of Justice and Federal Trade commission emphasized
that-
45
The Clayton Act of 1914 was drafted in the form of a laundry list of specific offences that
were declared anticompetitive. The statute outlawed tying, exclusive dealing, and stock
mergers ‘where the effect.... ay be to substantially lessen competition or tend to create a
monopoly in any line of commerce’. Competition policy and its implications for intellectual
property right the United States.
Page | 103
• Intellectual property and other forms of property should be placed on an equal

pedestal, without being oblivious of the inherent differences between IPRs and
other property as the far as the “ease of misappropriation” is concerned.46
• It should not be presumed that the existence of IPRs confer market power
upon the owner.47
• Competition policy and IP laws are intertwined with the common objective of
promoting innovation and consumer welfare, and the licenses that bent to the
complementary factors of production produce precompetitive result.48
Not only were the areas of convergence between competition policy and IP laws
highlighted but also certain novel features introduced, such as innovation markets,
horizontal and vertical relationships, steps to be followed in conducting ‘rule of
reason’ analysis and anti-trust ‘safety-zone’ with respect to licensing transactions.
The three distinct markets in which competition may be affected by a licensing

agreement were identified as- the markets for goods, the technology markets and the
innovation markets. The assessment of innovation markets would have to revolve
around the impact of licensing arrangement on the investment in R&D.
Further, the guidelines make it clear that the anti-trust analysis of any particular
licensing arrangement will be based upon the kind of relationship the parties share.49
In most cases, purely vertical relationships may not dampen competition in the
market, but there is no presumption to the effect.50 Conversely, merely the existence
of a horizontal relationship does not necessarily imply an adverse effect on
competition However, the most malicious horizontal arrangements such as price
fixing, market or customer allocation, or agreements to reduce output are deemed per
46
Section 2.1 states : “The Agencies apply the same general antitrust principles to conduct
involving intellectual property that they apply to conduct involving any other form of tangible
or intangible property.”
47
Section 2.0 (b) Id. : “The Agencies will not presume that a patent, copyright, or trade secret
necessarily confers market power upon its owner”.
48
Ibid
49
Section 3.3 FTC Antitrust Guidelines for Licensing of Intellectual Property 1995
50
Ibid
Page | 104
se unlawful; while other horizontal restraints, shall be scrutinized under the rule of
reasons.51
3.3.3 The Rule of Reason
The rule of reasons implies a fact based approach for the purpose of evaluating
the reasonableness of the alleged anti-competitive conduct. It is in the form of
weighing the pros and cons of the purpose and eventual consequence of the conduct
and if the pro-competitive effects outweigh the anti-competitive harm, then the
conduct is deemed reasonable. Therefore the guidelines avoid formalistic approaches
to the treatment of licensing practices, and provide for a case-by-case examination of
their actual effects in the context of licensing arrangements, in the light of relevant
economic and legal factors.52
Anti-trust scrutiny of licensing arrangements would mainly arise when they

harm competition among entities that would have been actual or likely potential
competitors in a relevant market in the absence of license.53
The guidelines also offer a valuable insight into the procedure to be followed
for application of ‘rule of reason’. First, an inquiry is to be made whether the restraint
has an anti-competitive effect.54 If so, consideration will then be given to whether or
not the restraint produces offsetting pro-competitive effects, such as by facilitating the
efficient development and exploitation of new technology.55 If such offsetting benefits
are established, an assessment will be made as to whether the restraint is reasonable
necessary in order to achieve the efficiencies. If it is and the efficiencies outweigh the
anticompetitive effect, the licensing arrangement will typically not be challenged.56
The anti-trust safety zones related to licensing transactions created a safe

haven for intellectual property owners by allowing them to place certain restraints in
51
Standard Oil Co. of New Jersey v. United States, 221 U.S.1 (1911)
52
“UNCTAD Report On Competition Policy and the exercise of Intellectual Property
Rights”, 2002, available ate www.unctad.org/en/docs//c2clp2rl.en.pdf last visited on
23/03/2011
53
Ibid
54
Section 4.2 I.d
55
Section 4.4.I.d
56
Section 4.2.I.d
Page | 105
licensing arrangements which would not invite the scrutiny by anti-trust authorities,
unless some exceptional circumstances existed. To fall within the ambit of safety
zone, the restraint should not be one which is derided under the pet se rule. Apart
from this, one of these additional criteria should be met.57
• The licensor and its licensees should not collectively account for more than 20
percent of each relevant market affected by the restraint, in case of goods
market.
• At least four independently controlled substitute technologies must exist in the
technology market.
• In case of innovation market, there should be at least four additional
independently controlled entities capable of conducting research and
development that would be a close substitute for the licensing parties’
activities.
3.3.4 Competition Advocacy in USA
Competition advocacy is an important aspect of a competition policy in

ensuring that patents are not too vague and they are not granted to undeserving
technologies, An important and highly pertinent example of a competition policy
advocacy activity in the specific area of intellectual property is the 2003 report of the
US Federal Trade Commission entitled To promote Innovation: The Proper Balance
of Competition and Patent Law and Policy.58 This report provides a penetrating
discussion of the harmful effects on competition that can flow from the awarding of
unjustified patents or patents that are cast in overly broad terms, One of these ill
effects include the deprivation of consumers of the benefits of competition, without
compensating value due to the market power conferred by an unwarranted patent on a
patent holder. Among other negative effects are those questionable patent holders.
Among other negative effects are that questionable patents can deter or raise the costs
of innovation. The report also puts forward a range of proposals to address these
57
Section 4.3 I.d
58
US Federal Trade Commission, “To Promote Innovation: The Proper Balance of
Competiiton and Patent Law and Policy, 2003”, available at
http://www.ftc.gov/2003/10/innovationrpt.pdf, last accessed on 24/03/2011
Page | 106
problems. Affirming the importance of such activities in relation to intellectual

property could be a valuable contribution of an international guideline or policy
development exercise relating to competition policy and intellectual property at the
multilateral level.59
3.4 INDIA
The Competition Act, 2002 if India has tried to deal with monopoly rights
conferred by IPR by inserting S. (3)(5) C.A, 2002 which is an exemption to section
(3)60 of the said act. This exemption recognises the importance of IPRS; however this
provision cannot be used in cases where there is an abuse of licence by IPR owners.
However the legislation concerning the other IPR, e.g. the granting of plant varieties
& Farmers Rights Act is still not recognised in the competition law. Moreover this act
fails to consider recent issues such as parallel importing, the exhaustion of rights or
compulsory licensing. When compared to the U.S. Anti-trust law, the latter recognise
the IPR laws as being on the same pedestal as other property rights and that on the
outset the IPRs do not grant per se a dominant power on the IPR owner 61, a more or
less similar provision is present in the India Competition Act 2002, which gives the
power to the Competition Commission of India to decide whether the IPR have
conferred a dominant position in the market by taking into considerations various
factors.62 Moreover the Competition Act 2002 does not prevent the IPR form
acquiring dominance, but simply prevents the abuse of dominance. One difference
between the Anti-trust law of USA and India Competition Act 2002 is that the former
is based on the rule of reason to determine whether a particular arrangement has any
ant-competitive effects and a detailed procedure on using the rule of reason is given,
however in India, no such provision exists and no guidelines is given in the
Competition Act 2002. One criticism which may be leveled against the US is that
based on the rule of reason, the granting of patents becomes quite subjective, which
may result in the granting of undeserved patents, which will have the effect of
59
The importance of competition advocacy activities vis-a-vis intellectual property policy is
also emphasized in Canada’s Intellectual Property Enforcement Guidelines, 2002.
60
Supra note 6
61
Supra note 69
62
Supra note 14
Page | 107
undermining the competition policy. Although India reflects to a certain extent the
competition advocacy, which is present in the US, however in India, the grants of
patents are more complex and thus care is taken that patents are not granted to
undeserving technologies.
When comparing the Indian Competition Act, 2002 with the UK competition Act
1998, one similarity which is found in both is that although they both have put
restraints on the abuse of dominant position, however IPR owners are not considered
as having marker power per se. In the UK, although IPR is treated as any other
properties, if they are subject to the Block Exemption of Transfer of Technology63
they may avail themselves of an exception to anti-competitive agreements, this
clauses (5) of Section (3) of the India Competition Act, 2002.64 However the Indian
Competition Act 2002 is different in that it includes in the UK competition Act,
1998.65 The Indian Competition Act has incorporated some provisions to the effect
that any merger/acquisition should undergo a merger review beyond a threshold level
of assets, turnover.66 The importance of combination regulation is mainly felt in the
field of pharmaceutical industries, if mergers are not regulated that it may constitute
market domination and there may be an abuse of licensing.67
The Competition Law regime in India has a rather complex history. The roots
of the Indian competition law can be traced back to Article 38 and 3968 of the
Constitution, which lay down the foundation of a system which comprises of socio-
eco-political justice. Article 38 and 39 also ensures an impartial distribution of
ownership and control of material resource in order to sub serve the common good
and to ensure that the economic system does not result in the concentration of wealth.
It is from these duties that the Monopolies and Restrictive Trade Practices Act,
63
Supra note 90
64
Supra note 14
65
Schedule 1 of the Competition Act 1998
66
Supra note 15
67
Supra note 91
68
Article 39 (b) and (c) the Constitution lays down that the State shall see to it: “(b) that the
ownership and control of the material resources of the community are so distributed as best to
sub serve the common good; (c) that the operation of the economic system does not result in
the concentration of wealth and means of production to the common detriment.
Page | 108
(MRTP) 1969, which is also influenced by US, UK and Canadian legislation69, came
into existence.
The MRTP,70 1969 was the first competition related legislation in India71.
However the Act was perceived to have failed in curbing the concentration of
economic power or in regulating the diverse monopolistic, restrictive and unfair trade
practices.72
In the new economic era, it was found that the ambit of the MRTP Act was
inadequate for fostering competition in the market and eliminating anticompetitive
practices in national and international trade. In October 1999, the Government of
India appointed a high level committee on Competition Policy and Law known as the
Raghavan Committee to advice on the Competition Law. The Raghavan Committee
concluded that there was a need for new competition legislation, where-after the
MRTP ACT, 1969 would be repealed and the MRTP Commission was found up. The
Committee recommended that the new Competition Law would not cover unfair
practices as its predecessor did, since such practices did came under the purview of
69
These include the Sherman Act, 1890, Clayton Act, 1914, the US Federal Trade
Commission Act, 1914 (as amended in 1938) in the US, the Monopolies and Restrictive
Practices (Inquiry and Control) Act, 1948, the Resale Prices Act, 1964 and Restrictive Trade
Practices Act, 1964 of the UK and the Combined Investigation Act, 1910 of Canada.
70
The thrust of the MRTP Act was directed towards:
• The prevention of concentration of economic power to the common detriment
• The control of monopolies
• The prohibition of monopolistic trade practices
• The prohibition of restrictive trade practices
• The prohibition of unfair trade practices
71
One of the main goals of the MRTP Act, was to encourage fair play in the market, besides
promoting healthy competition. In the MRTP Act, the basis of determining dominance was
whether an undertaking had a share of one-fourth or more in the production, supply, and
distribution of control of goods of services.
72
One of the criticisms voiced against the MRTP Act, was that no matter how malicious the
offences made by the cartels and no matter how serious the determent could have been, the
MRTP Commission was without any effective weapon to grant justice to the aggrieved
parties. The consequences were that the respondents, in case a complaint is lodged with
respect to such breach of law of the MRTPC inquires suo moto, can still enjoy the fruits of
their illegal acts, which may amount to a very large economic rent. Yet no penalty can be
levied because the MRTPC has not been empowered to impose penalties or spell out an order
of imprisonment to the offenders; what it can do is just pass a ‘cease and desist’ order,. Study
of Cartel Case Laws in Select Jurisdiction- ‘Learning’s for the Competition Commission of
India’ available at http://www.cci.gov.in/images/media/completed/cartel_report1_
20080812115152.pdf, last accessed on 23/03/2011.
Page | 109
the Consumer Protection Act, 1986. A Commission was to be formed under the new
Competition Law was to be denominated as the Competition Commission of India.
All monopolistic practices and restrictive trade practices case before the MRTP
Commission would be taken up by this new Commission and cases relating to unfair
trade practices to be transferred to Consumer forums. The new law, entitled the
Competition Act, 2002 received presidential assent on 13th January, 2003.
The New Competition law of India, namely, the Competition Act, 2002
focuses on four core areas:
3.4.1 Anti-Competitive Agreements
Anti-competitive agreements are defined as any arrangements or

understandings between businesses which result in appreciable adverse effect on
competition.73 Such agreements may be legal contracts in writing on maybe simple
verbal understandings made in informal settings. Under Section 3, the Competition
Commission is required to look into agreements which are anticompetitive in nature
and those found to be anticompetitive are declared void. Section 3(5) of the
Competition Act, 2002, is an exception clause, despite of the restrictions laid down
under Section 3 of the Act, it protects in the inventor of the intellectual property
73
Section 3. (1) of the Competition Act 2002 states : No enterprise or association of
enterprises or person or association of person shall enter into any agreement in respect of
production, supply, distribution, storage, acquisition or control of goods or provision of
services, which causes or is likely to cause an appreciable adverse effect on competition
within India.
(2) Any agreement entered into in contravention of the provisions contained in subsection (1)
shall be void.
(3) Any agreement entered into between enterprises or associations of enterprises or persons
or associations of persons of between any person and enterprise or practice carried on, or
decision taken by, any association of enterprises or association of person, including cartels,
engaged in identical or similar trade of goods of provision of services, which-
(a) directly or indirectly determines purchase or sale prices;
(b) limits or controls production, supply, markets, technical development, investment or
provision of services;
(c) shares the market or sources of production or provision of services by way of allocation of
geographical area of market, or type of goods of services, or number of customers in the
market of any other similar way;
(d) directly or indirectly results in bid rigging or collusive bidding, shall be presumed to have
an appreciable adverse effect on competition:
Page | 110
against the infringement of any such rights.74 The Competition Act thus recognizes
the interface between competition policy and IPRs under Section 3(5) of the
Competition Act 2002, based on the rationale that IPRs deserve to be protected and a
failure to do so would disturb the incentive for innovation, which, itself, would have a
negative effect in terms of a lack of technological innovation and reflect a lack of
quality in goods and services produced. However, equally, it does draw the line in as
much as it does not permit unreasonable conditions to be passed off under the guise of
protecting IPRs.75 Thus, in principle, IPR licensing arrangements which interfere with
competitive pricing, quantities or qualities of products would fall foul of competition
law in India. However, this manifestation of Section 3(5)76 is far removed from the
original recognition given by the Raghavan High Level Committee to the fact that all
forms of IPRs have the potential to raise competition policy problems, in effect
recognizing the existence/exercise distinction.77
Apart from that, it has no mention of exhaustion, parallel importation or

compulsory licensing.78 Section 3 also remains perplexing, in as much as it goes
against the MRTP Commission precedent under the old Act which held that the
Commission (and, by extension, the Competition Commission of India) had complete
and unfettered jurisdiction to entertain a complaint regarding IPRs Indeed, Manju
74
See 3(5), Competition Act, 2002- Nothing contained in this section shall restrict-(i) the
right of any person to restrain any infringement of, or to impose reasonable condition, as may
be necessary for protecting any of his rights which have been or may be conferred upon him
under-(a) the Copyright Act, 1957 (14 of 1957); (b) the Patents Act, 1970 (39 of 1970); (c)
the Trade and Merchandise Marks Act, 1958 (43 of 1958) of the Trade Marks Act, 1999 947
of 1999); (d) the Geographical Indications of Goods (Registration and Protection) Act, 1999
(48 of 1999); (e) the Designs Act, 2000 (16 of 2000); (f) the Semi-conductor Integrated
Circuits Layout-Design Act, 2000 (37 of 2000); (ii) the right of any persons to export goods
from India to the extent to which the agreement relates exclusively to the production, supply,
distribution or control of goods or provision of services for such export.
75
S. Jain and S. Tripathy, “Intellectual Property and Competition Laws: Jural Correlatives”,
Journal of Intellectual Property Rights, Vol 45 No.46 (2007), pp.236-243.
76
Subsection 5 has been added to section 3 of the CA 2002 as a result of the implementation
of the TRIPS Agreement in the Indian competition law.
77
The Committee noted that IPRs provide exclusive rights to their holders to undertake
commercial activities but this does not include the right to exert restrictive or monopoly
power in a market/society, Practices And Procedures: Vol. No.1(2006), P.757.
78
S. Ghosh, “New Act Could Hamper Efforts to Contain Anti-Competitive Trends In
Economy”. Financial Express, June 9, 2003,
http://www.financialexpress.com/printer/new/81508/ (10th June 2010)
Page | 111
Bhardwaj v. Zee Telefilms Ltd and Dr.79 Vallal Peruman v. Godfrey Phillips (India)
Ltd80 stand as authority for the view that unfair trade practices (as understood under
Section 36-A(1) of the old Act) could be triggered by the misuse, manipulation,
distortion, contrivance or embellishment of ideas generated by the complainant.
One pertinent point to be noted in this respect is that Competition Act has
overlooked the IP protection under the Protection of Plant Varieties and Farmers
Right Act, 2001. Even these are missing in Competition (Amendment) Bill, 2006. It
appears that the Competition Act does not recognize the rights of the holder under the
Protection of Plant Varieties and Farmers Rights Act and consequently any
infringement action or reasonable restriction imposed for protecting the rights granted
will also be subject to review by Competition Authorities.
3.4.2 Abuse of Dominance
According to Section 4 of the Competition Act 2002, no enterprise shall abuse

its dominant position.81 Concerning the interface, it can be inferred that the ownership
of an IPR does not automatically creates a dominant position; the power to decide on
dominant position is vested in the hands of the Commission, having regard to certain
factors, which have been listed.82 Whether or not dominance results from the
79
(1996) 20 CLA 229.
80
(1995) 16 CLA 201.
81
In its explanation of Section 4(of the Competition Act 2002, the Act has defined the term to
mean a position of strength enjoyed by an enterprise in the relevant market in India, enabling
it to: (i) operate independently of competitive forces prevailing in the market; or (ii) effect its
competitors or consumers of the relevant market in its favour.
82
In its explanation of S. 4(2) the term unfair or discriminatory condition in purchase or sale
of goods or service referred to in sub-clause (i) and unfair or discriminatory price in purchase
or sale of goods (including predatory price) or service referred to in sub-clause (ii) shall not
include such discriminatory condition or price which may be adopted to meet the competition;
or (b) limits or restricts-
(i) production of goods or provision of services or market therefore; or
(ii) Technical or scientific development relating to goods or services to the prejudice of
consumers; or
(c) indulges in practice or practices resulting in denial of market access [in any manner]; or
(d) makes conclusion of contracts subject to acceptance by other parties of supplementary
obligations which, by their nature or according to commercial usage, have no connection with
the subject of such contracts; or
(e) uses its dominant position in one relevant market to enter into, or protect, other relevant
market.
Page | 112
ownership of an IPR depend upon the extent to which there are substitutes for the
product, process of work to which the IPR relates. At this point it is worth mentioning
that the Competition Act 2002 does not prohibit or restrict enterprises from coming
into dominance. There is no control whatsoever to prevent IPR owners from coming
into or acquiring position of dominance. It prohibits only the abuse of that dominant
position. Therefore the Competition Act 2002 targets only the abuse of dominance
and not dominance per se. It does not consider dominance as such, as prejudicing
competition but it outlaws abuse of dominance. The legitimate exercise of an IPR by a
dominant undertaking is not an abuse. It is, however, possible that the way in which
an IPR is exercised may give rise to concern if it goes beyond the legitimate
exploitation of the IPR; for example, it is used to leverage market power from one
market to another or to prevent the development of a new market.
3.4.3 Combination Regulation
In India, Section 5 of the Competition Act, 2002 if closely read and analyzed
with Section 6 of the said act, prevents acquisitions which are restrictive in nature,
and which have an impact on the market access. The application of intellectual
property rights and the phenomena of acquisitions and merges go hand in hand and
would encourage monopoly rights in production, distribution and marketing of the
pharmaceutical inventions which would have direct implication on the consumer
behaviour by raising the price of commodities and applying restrictions on the
quantity and production size.
The competition legislation has made provision for merger review beyond a
threshold level of assets/turnover.83 The outright buyout of generic companies in India
by global Pharmaceutical companies or consolidation of generic companies in India
may give rise to competitive concerns within India as they may lead to monopoly
status. The pharmaceutical industry in India has been growing at a constant pace since
the Patents Acts 1970, which did not allow product patents and restricted the life of
83
The Competition Act, 2002 has made the pre-notification of combinations voluntary for the
parties concerned. Still, if the parties to the combination chose not to notify the Competition
Commission of India (CCI), they run the risk of a post-combination action by the CCI, if it is
discovered, subsequently, that the combination has an appreciable adverse effect on
competition.
Page | 113
drug and chemical patents to seven years. Since pharmaceuticals is a knowledge-

based industry, IPR plays a crucial role which mandate monopoly status to
companies. Often such monopoly maybe abused to the detriment of consumers.84 The
merger of the India firm Ranbaxy with the Japanese Daiichi Sankyo Co. Ltd in is one
such merger which triggered a lot of concern. The main benefit for Daiichi Sankyo
from the merger is Ranbaxy’s low-cost manufacturing infrastructure and supply chain
strengths while Ranbaxy gains access to Daiichi Sankyo’s research and development
expertise to advance its branded drugs business. Daiichi Sankyo’s strength in
proprietary medicine complements Ranbaxy’s leadership in the generics segment and
both companies acquire a broader product base, therapeutic focus areas and well
distributed risks. Ranbaxy can also function as a low-cost manufacturing base for
Daiichi Sankyo. Ranbaxy, for itself, gains smoother access to and a strong foothold in
the Japanese drug market. The immediate benefit for Ranbaxy is that the deal frees up
its debt and imparts more flexibility into its growth plans. Most importantly,
Ranbaxy’s addition is said to elevate Daiichi Sankyo’s position from number 22 to
number 15 by market capitalization in the global pharmaceutical market. The danger
of this type of merger is that the patent life maybe renewed indefinitely due to a lack
of competitors, Hence the Competition Commission should be more alert when
allowing such mergers.
3.4.4 Competition Advocacy
Competition Advocacy is one of the main pillars of modern competition law

which aims at creating, expanding and strengthening awareness of competition in the
market. Section 49 of the Competition Act, 2002 mandates the Competition
84
An example is the merging of two pharmaceutical giants, Glaxo Wellcome and Smithkline
to become Glaxo Smith line (GSK). GSK supplies products to 140 markets in the world this
merger created competition concerns in several countries yet it went unchallenged in most of
them. in India, there was no merger review provision in its existent competition law, so the
merger was not investigated in South Africa, the competition commission reached the
conclusion that the merger should be prohibited on competition and public interest ground.
An agreement was reached between the merging parties and the commission and the merger
was allowed conditionally. Pradeep. S. Mehta, “A functional competition policy for India”.
Cuts Centre for Competition, Investment & Economic Regulation, available at www.cuts-
international.org, last accessed on 03/03/2011.
Page | 114
Commission of India (CCI) to undertake advocacy for promoting competition.85 The

CCI has taken up competition advocacy efforts simultaneously with the Central
Government and State governments, besides undertaking advocacy with the other
stakeholders such as the business chambers, consumer activists/associations,
academic institutions and statutory bodies of professionals such as lawyers, chartered
accountants, cost accountants and company secretaries.86
The importance of advocacy activities by competition agencies is aimed at

ensuring that patents and other forms of intellectual property rights are not awarded
unnecessarily or cast in overly broad terms.87 The main effect of granting undeserving
patents is that it undermines the competition policy by flooding the market which may
lead to the unnecessary creation of market power and a slowdown in innovation.
Competition advocacy can include public education activities, studies and

research undertaken to document the need for market-opening measures, formal
appearances before legislative committees or other government bodies in public
proceeding.88
Broadly speaking, intellectual property right lessens competition while competition

law engenders competition. A workable solution can be predicated on the distinction
between the existence of right and its exercise. In other words, during the exercise of
85
S 49 of the Competition Act, 2002 states In formulating a policy on competition (including
review of laws related to competition), the Central Government may make a reference to the
Commission for its opinion on possible effect of such policy on competition and on receipt of
such a reference, the Commission shall, within sixty days of making such reference, give its
opinion to the Central Government, which may thereafter formulate the policy as it deems fit.
(2) The opinion given by the Commission under sub-section (1) shall not be binding upon the
Central Government in formulating such policy.
(3) The Commission shall take suitable measures, as may be prescribed, for the promotion of
competition advocacy, creating awareness and imparting training about competition issues.
86
“Competition Advocacy” available at http://www.cci.gov.in/index.php?optin=com_content
& takk=view&id=16(lat accessed 24/03/2011)
87
William Kovacic, “The Future of US Competition Policy,” The Antitrust Source,
September 2004 available at
http://www.fic.gov/speeches/kovacic/kovacicreplytokolasky.pdf), last accessed 23/03/2011
88
Robert D. Anderson and Frederic Jenny, “Competition Policy, Economic Development and
the Possible Role of a Multilateral Framework on Competition Policy: Insights from the WTO
Working Group on Trade and Competition Policy,” in Erlinda Medalla, ed., Competition
Policy in East Asia, Routledge/Curzon, chapter 4
Page | 115
a right, if a prohibited trade practice is visible to the detriment of competition in the

market or consumer interest, it ought to be assailed under the competition law.
3.4.5 Application of Section 3 and IPR’s
The Indian competition law, namely, the Competition Act, 2002 (the Act)
deals with the applicability of section 3 prohibition relating to anti-competitive
agreements to IPRs. An express provision [section 3(5)] is incorporated in the Act,
that reasonable conditions as may be necessary for protecting IPRs during their
exercise would not fall within the bundle of rights that normally form a part of IPRs
would be covered under section 3 of the Act Section 3(5) of the Act states that-
Nothing contained in this section shall restrict-the right of any person to

restrain any infringement of or to impose reasonable conditions, as may be necessary
for protecting any of his rights which have been or may be conferred upon him under
the:
(a) Copyright Act, 1957 (14 of 1957)

(b) Patents Act 1970 (39 of 1970).
(c) Trade and Merchandise Marks Act 1958 43 of 1958 ( Trade Marks Act 1999
(47 of 1999).
(d) Geographical Indications of Goods (Registration and Protection) Act 1999
(48 of 1999).
(e) Designs Act 2000 (16 of 2000).
(f) Semi-conductor Integrated Circuits Layout Design Act 2000 (37 of 2000).
Section 3(5) of the Act declares that ‘reasonable conditions as may be necessary
for protecting’ any IPR will not attract section 3. The expression ‘reasonable
conditions’ has not been defined or explained in the Act. By implication,
unreasonable conditions that attach to an IPR will attract section 3. In other words,
licensing arrangements likely to affect adversely the prices, quantities, quality or
varieties of goods and services will fall within the contours of completion law as long
as they are not in reasonable juxtaposition with the bundle of rights that go with IPRs.
Page | 116
For example, a licensing arrangement may include restraints that adversely affect
competition in goods markets by dividing the markets among firms that would have
competed using different technologies. Similarly, an arrangement that effectively
merges the Research and Development activities of two or only a few entities that
could plausible engage in Research and Development in the relevant field might harm
competition for development of new goods and services. Exclusive licensing is
another category of possible unreasonable conditions. Examples of arrangements
involving exclusive licensing that may give rise to anti-competition concerns include
cross licensing by parties collectively possessing market power, grant backs and
acquisitions of IPRs.
A few such practices are described below:
(a) Patent polling is a restrictive practice, which will not constitute being a part of
the bundle of rights forming part of an IPR. This happens when the firms in a
manufacturing industry decide to pool their patents and agree not to grant
licenses to third parties, at the same time fixing quotas and prices. They may
earn supra-normal profits and keep new entrants out of the market. In
particular, if all the technology is locked in a few hands by a pooling
agreement, it still be difficult for outsiders to compete.
(b) Tie-in arrangement is yet another such restrictive practice. A licensee may be
required to acquire particular goods (unpatented materials e.g. raw materials)
solely from the patentee, thus foreclosing the opportunities of other producers.
There could an arrangement forbidding a licensee to compete, or to handle
goods which compete with the patentee’s.
(c) An agreement may provide that royalty should continue to be paid even after
the patent has expired or that royalties shall be payable in respect of
unpatented know-how as well as the subject matter of the patent.
(d) There could be clause, which restricts competition in R & D or prohibits a
licensee to use rival technology.
(e) A licensee may be subjected to a condition not to challenge the validity of IPR
in question.
Page | 117
(f) A licensee may require to grant back to the licensor any know-how or IPR
acquired and not to grant licenses to anyone else. This is likely to augment the
market power of the licensor in an unjustified and anti-competitive manner.
(g) A licensor may fix the prices at which the licensee should sell.
(h) The licensee may be restricted territorially or according to categories of
customers.
(i) A licensee may be coerced by the licensor to take several licenses in
intellectual property even though the former may not need all of them. This is
known as package licensing which may be regarded as anti-competitive.
(j) A condition imposing quality control on the licensed patented product beyond
those necessary for guaranteeing the effectiveness of the licensed patent may
be an anti-competitive practice.
(k) Restricting the right of the licensee to sell the product of the licensed know-
how to persons other than those designated by the licensor may be violative of
competition. Such a condition is often imposed in the licensing of dual use
technologies.
(l) Imposing a trade mark use requirement on the licensee may be prejudicial to
competition, as it could restrict a licensee’s freedom to select a trade mark.
(m)Indemnification of the licensor to meet expenses and action in infringement
proceedings is likely to be regarded as anti-competitive.
(n) Undue restriction on licensee’s business could be anti-competitive. For
instance, the field of use of a drug could be a restriction on the licensee, if it is
stipulated that it should be used as medicine only for humans and not animals,
even though it could be used for both.
(o) Limiting the maximum amount of use the licensee may make of the patented
invention may affect competition.
(p) A condition imposed on the licensee to employ or use staff designated by the
licensor is likely to be regarded as anti-competitive.
Page | 118
3.4.6 Penalty Provisions
The Commission is empowered to inquire into any unreasonable conditions

attached to the IPR agreements and can impose penalty upon each of such right holder
or enterprises which are parties to such agreements or abuse, which shall be not more
than ten percent of the average turnover for the last three preceding financial years. In
case an enterprise is a ‘company’ its directors/officials who are guilty are liable to be
proceeded against and punished.
In addition, the Commission has the power to pass inter alia any or all of the
following orders (section 27) :
(a) direct the parties to discontinue and not to re-enter such agreement;
(b) direct the enterprise concerned to modify the agreements:
(c) direct the enterprises concerned to abide by such other orders as the
Commission may pass and comply with the directions, including payment of
costs, if any; and
(d) pass such other order or issue such directions as it may deem fit.
In case of abuse of dominant position under section 4 by virtue of an IPR by an

enterprise, in addition to the above penalties, the Commission has the power to order
division of enterprise under section 28.
3.4.7 The Interface Analysis:
The India Competition Act, 2002, deals with IPRs such as patents, copyrights,
trademarks, geographical indications, industrial designs and integrated circuit designs.
Whereas Section 3 of the India Competition Act, 2002 prohibits anti-competitive
agreements, sub-section (5) thereof acts as a counter balance and provides that this
prohibition shall not restrict “the right of any person to restrain any infringement of,
or to impose reasonable conditions, as may be necessary for protecting any of his
rights” enjoyed under the statutes relating to the above mentioned IPRs Therefore
unreasonable conditions imposed by an IPR holder while licensing his IPR would be
prohibited under the Competition Act. Thus, in the case of unreasonable restrictive
Page | 119
practices by the IPR holder, relief is available to the affected parties under the
Competition Act 2002. The Commission can pass a variety of orders, including
penalties up to 10% of the turnover, cease and desist Orders, direct modification of
the (license) agreement, and any other orders or directions that it may deem fit.
Agreements- Intellectual Property Right- Not Anti-competitive
Prohibition as provided in section 3 does not apply to the agreements relating

to the following statutory rights [Section 3(5)]:
• Copyright;
• Patent or exclusive right;
• Registered trademark, collective mark, permitted use, registered proprietor;
• Geographical indication, homonymous geographical indication;
• Design; layout-design;
• The right of any person to export goods from India to the extent to which the
agreement relates exclusively to the production, supply, distribution or control
of goods or provision of services for such export.
All the rights are statutorily available and are popularly known as intellectual
property rights, excepting the last. These rights are monopolistic. The owner has all
the right to exploit them and also the right to prevent other from so doing. There is no
violation of the Competition law if the owner of the articles (patented or otherwise)
seeks to dispose them directly to the consumer or fixes the price by which his agents
transfer the title from him directly to such consumer.89 The law relating to intellectual
property gives the right holder to exclude others from the use of his monopoly right,
absolutely or on terms. The right has to be confined within the relevant law. The
existence of intellectual property creates markets, because they provide the objects or
trade Reference to patent monopoly means that the patent holder has the ability to
charge supra-competitive prices and to control the market place supply based on the
rights granted by law. Lack of competition can allow patent owner to engage in profit
maximization by manipulating market demand for the product by controlling the
available supply and by limiting competition in the field because the patent portfolio
89
United States v. General Electrical Company et al. 272 US 476.
Page | 120
can act as a deterrent for competitors to enter the field. Thus conflict with the
competition law appears; as-
• the right erect barriers to entry to market; and

• licences granted for their exploitation may involve restrictions of competition,
e.g., fixation of prices, controlling production and supply, territorial
restrictions etc.
The exclusive rights granted by patent law do not mechanically translate into
market control. Despite strong patent positioning marketplace patent owner may not
have monopoly due to existence of competitive products90 substitutes exist for most
products91 Patent is viewed as property providing to its owner exclusivity against
other potential users of that source in the same way as real property provides to its
owner its exclusive use and enjoyment. Such exclusive rights are not viewed as
monopolies. They may, however, lead to monopoly. The product developed because
of the patent may be so superior that it has few substitutes and therefore has
considerable marked power. That is fair and legitimate. “There is no violation of the
antitrust laws if monopoly grows or develops as a consequence of superior product,
business acumen or historical accident92. To that extent, a company does not violate
competition laws merely because it has sufficiently large share of the marketplace.
The plan of the conspiracy to control the prices and distribution is not within its
protection. If it could be established that the owner of a monopoly right has acted in
concert with others to restrain trade and fix prices, the protection is not available.
All forma of intellectual property have the potential to raise competition

policy/law problems. Intellectual property provides exclusive rights to the holders to
perform a productive or commercial activity, but this does not include the right to
exert restrictive or monopoly power in a market or society. Undoubtedly, it is
desirable that in the interest of human creativity, which needs to be encouraged and
rewarded, intellectual property right needs to be provided. This right enables the
holder (creator) to prevent others from using his/her invention, designs or other
90
Vandenhoeck v. Commissioner 4TC 125, 1944 U.S. Tax Ct. Lexis 47;
91
U.S. v. E.I. Dupont de Nemours & Co. 351 US 377.
92
Smith v. Nothern Mich. Hospitals 528 F. Supp. 644 (W.D Mich 1981).
Page | 121
creations. But at the same time, there is need to curb and prevent ant competition
behavior that may surface in the exercise of the intellectual property.
There is, in some cases, a dichotomy between intellectual property rights and
competition policy/law. The former endangers competition while the latter engenders
competition. There is a need to appreciate the distinction between the existence of a
right and its exercise. During the visible to the detriment of consumer interest or
public interest, it ought to be assailed under the competition policy/law.”
Section 3(5), therefore, exempts agreements relating to intellectual property rights

under the laws as specified therein, from the applicability of section 3(1) and (2).
Only reasonable and legal conditions under those laws are not within the prohibition.
For example, the patent law gives the patentee the right to exclude others form the use
of his invention, absolutely or upon terms. The exertion of this right within the field
of patent law is not the offence under the competition law. A patentee, in licensing
another person to make, use, and vend, may lawfully impose the condition that sales
by the licensee shall be the prices fixed by the licensor and subject to change at his
discretion93. But when the patented article is sold it passes beyond the patent
monopoly.
Intellectual property rights- There are a string of rights available for the protection
and exploitation of technology, design, trademark, etc. Such rights are called, as
aforesaid, intellectual property rights. They are palpitation and use, again the intellect.
Intellectual property rights are negatively available, protected by law against
limitation and piracy. The obligation is fastened on persons other than the owner, to
take care against imitation, piracy, plagiarism.
Infringements involve liability for damage or invites penalty, fine or prosecution.

The intellectual property rights operate in two ways: one, the holder’s freedom to
exploit them; and second, their ability to prevent others exploiting.
The intellectual property consists of two branches: industrial property chiefly

covering patents, rights in technological inventions, trademarks, industrial designs,
93
United States v. General Electric Company, 272 US 476
Page | 122
appellations of original etc. and copyrights covering musical, artistic, literary and
photographic works.
Intellectual property rights-reasonable restrain and conditions in exploitation-

Agreements concerning intellectual property rights are subject to competition law to
the extent restrain provided or conditions imposed are not necessary for the protection
of those rights94. The obligations in a licence for the exploitation of an intellectual
property right are not “restrictions” within the meaning of the Competition Act 3(5) of
the Competition Act]. The obligations in a licence for the exploitation of an
intellectual property right are not “restrictions” within the meaning of the Competition
Act95. If the agreement confers right to exploit the patented invention on payment of
royalties on the conditions which do not go beyond the scope of the patent, the
question of applicability of the prohibition under the Competition Act does not arise;
but arises if the grant is accompanied by the terms which go beyond. For example, “a
copyright may no more be used than a patent to peter competition between rivals in
the exploitation of their licenses”96. To determine the scope, it is necessary to define
the specific subject matter of the right and its exhaustion. Any term which is outside
the subject-matter and exhaustion of the right, is subject to competition rule.
The following concepts have, therefore, to be kept in view if the demands of the
competition law are to be reconciled with the protection of intellectual property rights:
• there is dichotomy between the existence of intellectual property rights and

their exercise; the competition law is concerned with the latter;
• the protection of the “specific subject matter” of the rights is justified even if
it adversely affects competition;
• once the right as specified in the subject-matter is exhausted, i.e., when the
holder of the right has consented to selling the protected product, the
agreement will lose protection and be subject to competition law.
The right in the intellectual property exists as per provisions of the respective
laws relating to them and the terms and conditions mentioned therein. Its exercise
94
Section 3(5) of the competition Act, 2002.
95
Ravenseft Properties Ltd.’s Application (1977) All ER 47”
96
United States Paramount Pictures, In. et at 334 US 131.
Page | 123
within the scope of the relevant Act is protected, even if it involves infringement of
the competition law; but not done if it goes beyond that scope. To determine, it is
necessary to ascertain what the subject matter of the right is and whether or not it gets
exhausted.
3.4.7.1 Patent
Subject matter and exhaustion of the right- The specific subject-matter for a
patent is “the guarantee that the patentee, to reward the creative effort of the inventor,
has the exclusive right to use an invention with a view to manufacturing industrial
products and putting them into circulation for the first time, either directly or by the
grant of licences to third parties, as well as the right to oppose infringements”97. The
specific subject matter is putting into circulation for the first time patented products.
The right is exhausted, once the product has been placed on the market.
An agreement to use patent may include restraint of trade or commerce, is not

within the prohibition of the competition rule if it involves only the reasonable and
legal conditions imposed under the patent law98. It is not prohibited, if the agreement
simply, confers rights to exploit patented inventions against payment of royalties. But
it would be, if the grant is accompanied by terms which go beyond the need to ensure
the existence of the intellectual property rights. It would, therefore, mean that
existence of intellectual property right does not infringe the competition law but its
exercise99. The right is exercised by the owner himself or by permitting other to do
under a licence. The patent incensing is not caught within the prohibition clause of the
competition Act, if the obligations imposed relate to limitation of the exploitation of
the invention to certain of the forms which are provided for by patent law
manufacture, use or sale), Limitation of the manufacture of the patented product,
limitation of the quantity of production, limitation of exploitation in time or with
regard to the person or territory etc.
97
Centrafram v. Sterling Drug (1947) ECR 1147, (1974) 2 CMLR 480.
98
Bement v. Nationla Harrow o 186 US 70.
99
Parke Davis & Co. v. Probel and Contrafarm (1968) ECR 55]
Page | 124
The following restraints and conditions in a licence are not unreasonable or the
exercise of right and are not violative of the competition Law:
• limitation of the exploitation of the invention (making, selling or using) as the

monopoly of a patent extends to the right of making, selling and using as each
is a separable and substantial right100;
• limitation about the licence to use upon the prescribed conditions, as the larger
rights of exclusive use of the patentee embraces the lesser one of only
permitting the licensee to use upon the prescribed conditions101;
• exclusion of other from the use of the invention, absolutely or upon terms is a
right under the patent law and its exercise is not an offence against the
competition law102;
• payment of royalties according to an agreed percentage of the licencee’s sales
is not unreasonable103;
• lawful imposition of conditions by a patentee, in licensing another person to
made, use or vend, that sales by the licenses at the price fixed by the licensor
and subject to change at his discretion104.
An owner of intellectual property does not have absolute right to sue property in
any manner without restriction105. It would violate the competition Law if a company
possesses monopoly power and there is willful acquisition or maintenance that power
which an enterprise as distinguished for growth or development as a consequence of
superior product, business acumen or historic accident106. Patent is a property, as
aforesaid, and its owner has a right of exclusivity. That right is not however, not
unrestricted. As most properties, it is also subject to limit restrictions essential for the
maintenances of an ordered society for the benefit or the public. An owner of
intellectual property does not have absolute right to use it in any manner with
100
Henry v. A.B. Dick Company 224 US 1 (1912).
101
Henry v. A. B. Dick Company.
102
United States vs. United Shoe Machinery Company 247 US 32 (1918).
103
Automatic Radio Manufacturing Co. Inc. v. Hazeltine Research Inc. 339 US 827.
104
United States v. General Electric Company et al 272 US 476 (1926).
105
US v. Microsoft 253 F.3d 34 (D.C. Cir 2001).
106
U.S. v. Grinnell Corp. 384 US 563 (1966).
Page | 125
restriction107. In 1998, the United States sued Microsoft, alleging violations of

sections 1 and 2 of the Sherman Act. After trial, the court found that Microsoft had
violated section 2 by unlawful maintaining its monopoly in the market for Intel-
compatible PC operating systems (OSs) and by unlawfully attempting to monopolise
the market for internet bowers, and that it had violated section 1 by illegally tying its
Windows operating system and its Internet Explorer (“IE”) browser. The court
ordered to submit a plan of divestiture that would split the company into an OS
business and an applications business, and ordered interim conduct restrictions. The
agreements are not immune from the applicability of the competition law if the
conditions imposed by it go beyond the limit of reasonableness which may be
necessary for protecting the rights conferred upon the person under various laws
relating to intellectual property rights. Thus, for example, the patent law gives the
patentee the right to exclude others forms the use of his invention, absolutely or upon
terms and the exertion of this right within the field of patent law is not an offence
against the Competition Law. Whether a patentee lawfully imposes restrictions on the
use of a patent and whether the violation thereof constitutes infringement are
questions under the patent law. A patentee may elect to sue his license upon the
broken contract, or for forfeiture for breach, or for infringement. While an absolute
and unconditional sale operates to pass the patented article outside or the boundaries
of the patent, patentee may, by a conditional sale, so restrict the use of his vendee
within the specific boundaries of time, place or method as to make prohibited uses
outside of those boundaries constitute infringement and not mere breach of collateral.
The extent of licence to use, which is carried by a sale of a patented article depends
upon whether any restrictions were placed upon the sale, and if so what they are, and
how they were brought home to the vendee; and where a restriction is plainly placed
upon the home to the vendee; and where a restriction is plainly placed upon the article
itself, a sale carries with it only the right to use within the limits specified, and any
other use is an infringing one108. Although a contract in regard to use of patent may
include restraints which causes or likely to cause an appreciable adverse effect on
107
U.S. v. Microsoft Corp. 253 F. 3d 34 (D.C. Cir. 2001).
108
Henry v. A. B. Dick Company 224 US 1 (1912)
Page | 126
competition within India, if it involves only reasonable and legal conditions imposed
under the patent law, it is not within the prohibition of the competition Act.
But if they affect the market place which lead to market distortion and interfere
with competition, such as manipulating market demand or erecting barriers for the
competitors to enter the market, such restrictions are subject to competition law
especially when the person possesses monopoly power and there is willful acquisition
or maintenance of treat power distinguished from growth or development as a
consequence of superior product, business acumen and historic accident.
Some of the conditions and infringements are held by the courts violating the
competition law:
• Fixation of prices after sale, because when the patented article is sold it
passes beyond the patent monopoly109;
• Patentee fastening upon the ownership of the articles sold by him control
of the prices at which his purchaser shall sell110;
• A group of competitors entering into a series of separate patent licensing
with the knowledge that all other concerns in the industry would accept
similar licences, thereby giving a strong inference that agreements are the
result of a concerted action111;
• Plan of conspiracy to control prices and distribution is not within the
protection of patent monopoly112;
• Agreement for payments of royalties on production of unpatented entered
articles, is in purpose and effect increase the area of patent monopoly and
is invalid113;
• Where the purpose is to prevent competition by uncontrolled resale prices,
and arrangement for the elimination of jobbers does not fall within the
protection of patent grant114.
109
United States v. United Shoe Machinery Co. 247 US 32.
110
United States v. General Electronic Company 272 US 476.
111
United States v. United States Gypsum Co. 333 Us 364.
112
Ibid.
113
Id.
114
Id.
Page | 127
3.4.7.2 Trademarks
Subject-matter and exhaustion of right-The specific subject matter of a

trademark, as in case of a patent, is the right to first marketing. It is defined “the
guarantee that the owner of the trademark has the exclusive right to use that
trademark, for the purpose of putting products protected by the trademark into
circulation for the first time, and is therefore intended to protect him against
competitors wishing to take advantage of the status and reputation of the trademark by
selling products illegally bearing that trademark”115. Putting products protected by the
trademark into circulation for the first time, is its specific subject-matter. The
principle of consenting to first marketing of the product as indicating the exhaustion
of right as applied in the case of patent, is difficult proposition in the case of right as
applied in the case of patent, is difficult proposition in the case of trademarks.
Trademark has not only been viewed from the point of view of its holder, but also
from that of the consumers. Consumers identify goods as originating form a particular
source. The specific subject-matter of a trademark, as aforesaid, is the guarantee that
the owner of the trade-mark has the exclusive right to use…” From the point of view
of consumers it may mean as a “guarantee of the identity of the origin of the traders
marked product to the consumer or ultimate user, by enabling him without any
possibility of confusion to distinguish that product from products which is sold to him
has not been subject at a previous stage of marketing of the trademark, such as to
affect the original condition of the product”116. That guarantee is the essential function
of the trademark. Thus, to determine the scope of the specific subject-matter of
trademark as a guarantee to the owner of the trademark has the exclusive right to use
for the purpose of putting products protected by trademark into circulation for the first
time, regard must be had to another guarantee to the consumer to the identity of the
origin of the trade marketed product (essential function of the trade-mark)117.
3.4.7.3 Copyright
Subject-matter and exhaustion or right- The copyright represents a work which

is the product of labour, skill or capital of the author which is legally protected so that
115
Centrafarm v. Winthrop (1974) ECR 1183.
116
Hoffmann-Lal Rochev. Centrafarm (1978) ECR 1139.
117
CNL-SUCAL v. HAG GE AG (1990)] 1 ECR 3711.
Page | 128
it cannot be exploited commercially by another only the author has the right to do.
The right is different from other kind of intellectual property, viz, patents design,
trademark in that latter create a monopoly and are acquired only by registration,
whereas registration is not necessary in case of copyright which subsists
automatically, Copyright subsists in literary or artistic work and its subject-matter and
exhaustion cannot be defined in specific terms as done in case of patent right as
putting the patented product on the market for the first time and the patent holder
consenting to the first marketing of exhausted on the product. For example, a
copyright in cinematographic film is not exhausted on the first marketing of the film.
“A cinematographic film belongs to the category of literary and artistic works made
available to the public by on the first marketing of the film. “A cinematographic film
belongs to the category of literary and artistic works made available to the public by
performance which may be infinitely repeated”118. The right of the copyright owner to
require fees for any showing of a film is part of the essential function of the copyright
in this type of literary and artistic work. The matter would be different in connection
with literary and artistic work made available to the public in the material form, as
books or records. In that case, rights are exhausted by the first marketing119.
Copyright under the Copyright Act, 1957 represents a work which is the
product of labour, skill or capital of the author which requires legal protection, so that
it cannot be taken away or exploited commercially by another. The Copyright Act,
1957 provides protection against imitation of literary or artistic works which are the
result of efforts, imaginative and intellectual creation. Its object is to protect the writer
and the artist forms the unlawful reproduction, plagiarism, piracy and imitation. The
cruxes of the protection lies in commercial exploitation which means that nobody can
illegally copy, sell, hire, trade or otherwise use the copyrighted article. Thus, there is
no copyright in information or ideas but only in the manner of expressing them. The
author has two broad categories of rights:
1. Right to exploit the copyright commercially, to his advantage, and;
118
SA Companies v. Coditel (1980) ECR 881.
119
Musik-Vertrieb Membran v. GEMA (1981) ECR 147.
Page | 129
2. Right to claim authorship and to protect his reputation and honour in relation
to his work.
Their violation or infringement confers a further right to claim civil remedies by

way of injunction, damages, accounts and delivery of infringing copies.
Inter-state Circuit case-
In Inter-state Circuit Inc. V. United States distributors of motion picture films,

owned or controlled the copyrights and engaged inter-state in the business of
supplying the films to theatres for exhibition under licence contracts. They join in
making and carrying out an agreement with the owners of the theatres in certain cities
to whom their licenses for first run exhibitions of “feature” pictures in those cities are
confined, where by the distributors, in granting licenses in those cities are confined,
whereby the distributors, in granting incenses to other theaters in the same places for
subsequent run of such films. The purpose and effect of these restrictions are to
maintain the higher prices of the first run theatre and protect them from the
competition of the others.
The court held the contracts were not protected by the Copyright Act and that,
apart from any agreement between the distributors themselves, they were contrary to
the Anti-Trust Act, observing inter alia, that:-
• the evidence in this case supported the difference that the distributors of the
films acted in concert, in making their several agreements with the first run
exhibitors and imposing the restriction so stipulated on the subsequent run
exhibitors.
• acceptance by competitors, knowing that concerted action is contemplated, of
an invitation to participate in a plan, the necessary consequence of this, if
carried out is restraint in inter-state commerce, is sufficient to establish an
unlawful conspiracy under the Sherman Act;
• a contract between the copyright owner of motion picture films and owner of
the motion picture theatres, restraining the competitive distribution of the
films in the open market in order to protect the theatre owner from
competition of other theatres is not protected by the Copyright Act;
Page | 130
3.4.7.4 Patent, Design and Trademarks-Commercial Intangibles
Intellectual properties associated which commercial activities are referred to

commercial activities are referred to as commercial intangibles. They are categorized
into two groups:
1. Trade intangibles, such as patents, designs and models;

2. Marketing intangibles, such as trademarks and trade names.
Trade intangibles are basically concerned with the provision of services e.g.
patents; while marketing intangibles with the promotion of sales, e.g. trademark.
3.4.7.4.1 Patent and Anti-Competitive Agreement
Patent or exclusive right granted under the Patents Act, 1970 is outside the
scope of section 3. A patent grants Act, 1970 is outside the scope of section 3. A
patent grant-in-aid of itself is an exception to the general rule against monopolies and
to the rights to a free and open marked. But even a patent right holder is not immune
from competition law liability.
The patent law is one creating and protecting a true monopoly granted to sub
serves a broad public policy. The monopoly extends to the right or market, selling and
using, and each is separable and substantial right. The patentee may exclude others
from the use of his invention, absolutely or upon terms.
Competition law is not violated, if the exertion of the right is within the field
of the patent law. Thus, a contract in regard to use of a patent may include an
agreement prohibited under section 3(1), if that contract is within patentee’s patent
rights. It is not void. It would by void, if it involves conditions which are not within
such rights but volatile of section 3(1).
However, in United States v. United States Gypsum Company et al.120 it was

held that the plan of conspiracy to control prices and distribution was not within the
protection of the patent monopoly. In that case, the defendants were charged with
violation of articles 1 and 2 of the Sherman Act for a conspiracy to restrain and
120
333 US 364,
Page | 131
monopolies interstate trade in gypsum products. It was alleged that the defendants
acted in concept in entering into patent licensing agreements:
• that one of the defendants, dominant in the industry, granted patent licenses
and other defendants accepted licenses with the knowledge that all other
concerns in the industry would accept licenses similar licenses; and
• that as a result of such concert of action, competition was eliminated by fixing
the price of patented board, eliminating the production of unpatented board,
regulating the distribution of patented board, and stabilizing the price of
unpatented plaster.
The Court, inter alia, held as follows, while ordering remand:
1. The evidence established a violation of the Sherman Act.

2. The plan of the conspiracy to control prices and distribution was not within the
protection of the patent monopoly. United States v. General Electric Co. 272
US 576 was distinguished. It was held that that case does not authorize a
patentee, acting in concert with all members of an industry under the terms of
which an industry is completely regimented, the production of competitive
unpatented products suppressed, a class of distributors squeeze out, and prices
on unprotected products stabilized.
3. The industry-wide license agreement, entered into with the knowledge on the
part of the licenser and the licensees of the adherence of others, under which
control was exercised over prices and methods of distribution, were sufficient
to establish a prima facie case of conspiracy.
4. Patent exploitation of the kind here attempted is within the prohibition of the
Sherman Act, regardless of the motives of the participants.
5. When a group of competitors enters into a series of separate but similar
agreements with the competitors or others, a strong inference arises that such
agreements are the result of concerted action.
6. The provision in the patent licensing agreements for payment of royalties on
the production of unpatented board is strongly indicative of an agreement not
to manufacture unpatented board; and the testimony in this case is ample to
show that there was understanding, if not a formal agreement not to
Page | 132
manufacture unpatented board; and the testimony in this case is ample to show
that there was understanding, if not a formal agreement, that only patented
board would be sold. Such an arrangement in purpose and effect increased the
area of monopoly and is invalid;
7. Where the purpose is to prevent competition by uncontrolled resale prices, an
arrangement for the elimination of jobbers does not fall within the protection
of the patent grant.
8. The “rule of reason” is applicable to efforts to monopolies through patents.
9. In a suit to restrain alleged violations of the Sherman Act, in which the
defendant rely upon patents, the Government is entitled to an opportunity to
prove that the patents were invalid.
On the remand ordered by the Court in the above case to enjoin violations of the
Sherman Act. The District Court entered a summary judgment for the United States.
The District Court found that the defendants had acted in concert to restrain trade and
fix prices in the gypsum board industry in the eastern territory on the United States,
and monopolized that industry. In violation of articles 1 and 2 of the Sherman Act.
The Supreme Court, inter alia, in the case of United States v. United States Gypsum
Co121 held that:
• Establish a violation of the Sherman Act, it was sufficient to show that the
defendants, constituting all former competitors in an entire industry., had acted
in concert to restrain commerce in an entire industry under patent licenses,
each containing price-fixing provision, violates the Sherman Act.
• The defendants had violated the Sherman Act in view of the concert of action
to fix prices by the terms of the patent licences.
3.4.7.4.2 Marketing Intangibles
Marketing intangibles are those which and in the commercial exploitation of a

product or service. They are trademarks and trade names. A trademark means a
mark capable of being represented graphically and which is capable of
distinguishing the goods or services of one person from those of the other, and
121
. et. Al. 340 US 7
Page | 133
includes shape of goods, their packaging, and combination of colours, indicating a

connection between the goods or services and the person having the right either as
a proprietor or by way of permitted use. It is thus a distinctive identification of a
manufactures produce or of a service taking the form of name, sign, motto, device
or example; a distinctive mark attached to goods or services to identify them with
a particular trade or with his successor as the owner of the particular business. A
trademark performs three functions, (i) it identifies the product and its origin; (ii)
it guarantees its unchanged quality, and (iii) it helps to advertise the product.
Primarily trademark gives an indication to the purchaser or the possible purchaser
as to the identity of the manufacturer or quality of goods or source from which
goods come, or the trade channels through which they pass on their way to the
market.
As in the case of patent and other intellectual property rights, there is a

distinction between the existence and exercise of trademark. The exercise is
subject to competition law. In Constenand Grundig v. Commission (1966) is
subject to competition law. The agreement and the registration of the trademark
gave consent absolute territorial protection against parallel importation. By virtue
of that agreement consent was able to affect the registration, though regarded
under the French law to be original holder of the trademark. The Court held that
“The injunction to refrain from using of parallel imports does not affected by but
their exercise may fall within the prohibition of the competition law. Prohibitions
and restrictions as provided under the competition Act may be justified only for
the purpose of protecting intellectual property rights, and not otherwise.
3.4.7.5 Export of Goods- Agreements are not Anti-Competitive
Sub–clause (g) of section 3(5) provides that the agreement would not be anti-
competitive if it relates exclusively to the production supply, distribution or
control of goods or provision on services for export from India:
The activity of export is exempted, because it does not affect the domestic
market. For example, price-fixing with respect to goods and services sold
domestically is subject to control under the competition law, but price fixing with
respect to export is permitted. An agreement is anticompetitive if it has “adverse
Page | 134
effect on competition with India” [section 3(1)] of the Competition Act, 2002. The
focus is on domestic effects of anti-competitive transactions conduct. The reach of
the Indian law is not limited to conduct and transactions that occur within India
regardless where such conduct or transaction occurs or the nationality of the
persons involved. The purpose of the Indian law is to protect consumers,
competition and commerce in India. It does not extend to protect the foreign
markets from anti-competitive effect and regulate the competitive competitions of
other countries. It the Indian market is affected, whether it is the export or the
domestic market, the anti-competitive conduct falls within the prohibition. If
neither happens, it saved.
3.5 Essential Facilities Doctrine
Essential facilities doctrine was enunciated by the United States Supreme

Court in United States v Terminal Railboard Association122 wherein they imposed a
duty upon firms controlling an “essential facility” to make that facility available to
their rivals. The essential facilities doctrine has profound consequences for
intellectual property protection and for competition in markets where firms own
important inputs that are protected by patent, copyright, or trade secret.123 In the
intellectual property context, an obligation to make property available is equivalent to
a requirement for compulsory licensing. The concept of “essential facilities” requires
there to be two markets, an upstream market as well as downstream market.
Typically, one firm is active in both markets and other firms are active or wish to
become active in the downstream market. The downstream market competitor wishes
to put an input from the integrated firm, but is refused. Thus, essential facilities
doctrine comes in a way to rescue the firm and restrains such refusal.124
In United States v Teirninal Railboard125 of St. Louis Association, a joint

venture between railroad companies to buy and run rail terminals. The joint venture
denied members the ability to use the terminals. Another bridge was a very expensive
122
(1985) 472 US 585.
123
J. Gilbert & Carl Shapiro : An Economic Analysis of Unilateral Rules to license
Intellectual Property, 93 Proc. Natt. Acad. Sci. USA 12749.
124
Supra note 90.
125
Supra note 1, at 186.
Page | 135
project as not only in river broad, its course shifts and there was the one site where
such a bridge was technically feasible for many miles. Access was vital to the
railroads that had arrived after the bridge was built and his development of the rail
road’s an important activity in the country. The Supreme Court found this in violation
of section 1 of the Sherman Act and ordered that new railroads be given access to the
bridge on terms similar to those agreed between the original railroads. The Court
based its decision on a finding that the nonmembers could not compete effectively
without access to these “essential facilities”.
Supreme Court of United States further gave “intent, to monopolize” test in

Aspen Skiing Co. v Aspen Highlands Skiing Corp.126 and supplemented the essential
facilities doctrine. Court held that monopoly firms are generally not obliged to engage
in joint marketing programmes with competitors, but the general rule can change if
the monopolist’s refusal to allow the competitor to participate in cooperative venture
“makes an important change in a patterns of distribution” of goods.127
The essential facilities doctrine refers to a situation where a dominant firm

owns or controls a facility that is indispensable to its competitors and refuses to grant
access to that facility. Essential facilities doctrine often overlaps with “monopoly
leveraging doctrine” which refers to those situations where a company uses its
monopoly power in one market to gain a competitive advantage or to monopolize or
attempts to monopolize another market.128 Though both the doctrine aims at
restraining abuse of dominant position; plaintiff in an essential facility lawsuit must
objectively prove that access to the facility is “indispensable” in order to compete in
the market with the firm that controls the facility which is not so in case of asserting
monopoly leveraging doctrine.129
126
(1985) 472 US 585.
127
Ibid.
128
Berkey Photo, Inc. Vs East may Kodak Co. 603 F 2d 263 (2nd Cir, 1979).
129
James S. Venit & John J. Kallaughir; “Essential Facilities : A Comparative Approach,
1994 Fordhans Corp L Inst. 315 (Barry E. Hawk ed. 1995)
Page | 136
Essential Facilities Doctrine and Refusal to Deal/License
One of the basic principles of competition law is the ‘Colgate doctrine’

evolved by the United States Supreme Court130. Supreme Court held that a firm’s
unilateral decision with regard to deal or not to deal with other entities can never be
anticompetitive (within the meaning of section 1 of the Sherman Act). The rule
enunciated by the court was that:
“In the absence of any purpose to create or maintain a monopoly, the

act does not restrict the long recognized right of trader or
manufacturer engaged in an entirely private business, freely to
exercise his own independent discretion as to partiers with whom he
will deal. And, of course, he may announce in advance the
circumstances under which he will refuse to sell.”131
In addition to condemning certain unilateral refusals to deal because they

allow a firm to obtain or retain monopoly power, the competition law, also imposes a
duty on the offending firm to deal with others because the goods or services that firm
would otherwise choose to withhold are necessary for vigorous competition. One
theory that has been deal exist is the so-called essential facilities doctrine.
The canons of essential facilities doctrine were further expanded by European

Courts by holding that in certain circumstance: even a refusal to supply might be
abusive.132 In Volvo case133, Volvo held a UK registered design for the front wing
panels of Volvo Series 200 cars. Veng imported imitation of Volvo’s wing panels into
the UK from other member’s states without Volvo’s authorization. Volvo brought an
action against Veng for preventing him from importing and marketing those designs in
UK. Volvo refused to license its design rights, despite Veng’s willingness to pat a
reasonable royalty. ECJ held that right to the proprietor of a protected design to
prevent third parties form manufacturing and selling or importing without the
proprietors’ consent products incorporating the design constitutes “the very subject
130
See United States v Colgate & Co. (1919) 250 US 300.
131
Ibid at 307.
132
See Radio Telcfis Eireann v Commission (C-241 & 242/91 p), 6th April 1995; (1995) ECR
I-743; (1995)1 CEC 400 (ECJ).
133
Case 238/87, Volvo, 1998 E.C.R 6211.
Page | 137
matter” of its exclusive right.134 Accordingly, the ECJ ruled that an obligation
imposed on the proprietor of a protected design to grant license to third parties, even
in marketing of products incorporating the design, would deprive the proprietor of the
substance of his exclusive right.135
Later on, it was realized that refusal to grant a license, few undertaking owing
to an English copyright were dominant in the supply market for television listings.
The competitor, Magill was a small company who wished to publish weekly listings
of three television companies broadcasting in United Kingdom and Ireland. However,
due to copyright protection available for television listings under British and Irish
Law, reproduction of the listings on a weekly basis was forbidden in order to avoid
competition with the broadcasters’ own well guides. Magill tried to get a license from
the undertakings, but was refused. Later on, broadcasters collectively enjoined Magill
from publishing a multi-channel guide showing all of the broadcasters’ programmes
side-by-side. During the proceedings in Ireland and before a judgment by the Irish
court, the Europeans commission decided to act on Magill’s complaint of abuse of a
dominant position and ordered the broadcasters to begin negotiations with Magill for
a royalty bearing license. The Commission’s decision was appealed before the Court
of First Instance and the ECJ did not rely on copyright, but on the station being the
only source of information about their programmes which shows that intellectual
property rights do not necessarily confer a dominant position: it depends on whether
there are adequate substitutes.
Court held that there was no justification for such refusal either in the activity
of television broadcasting, or in that of Court that freedom of contract might be
sacrificed in the case of “exceptional circumstances” under which a refusal to deal
opposed by intellectual property right holders (specifically: three holders of copyright
covering TV programmes) objectively prevented potential competitors from offering
a new product or service on a downstream marked. Magill was the first and the only
case in which the ECJ has imposed duty to license an IPR to prevent the infringement
of EC competition laws.

134
Ibid at 62, 35.
135
Ibid.
Page | 138

Comparative Study of Interfacing Jurisprudence: Chapter-III

Uploaded by

Copyright:

Available Formats

You might also like

Comparative Study of Interfacing Jurisprudence: Chapter-III

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Comparative Study of Interfacing Jurisprudence: Chapter-III

Uploaded by

Copyright:

Available Formats

Chapter-III

COMPARATIVE STUDY OF INTERFACING

3.1 EVOLUTION AND GROWTH AT REGIONAL LEVEL

3.1.1 EUROPEAN UNION (EU)

Historically there was a period when the misunderstanding of the economic

Secondly, competition policy regulates certain terms of bilateral IPR licensing

Thirdly, competition policy regulates cooperative relationships between

below the threshold of dominance (and is not part of a collectively dominant

Secondly, there must be a determination of whether or not the firm allegedly

Thirdly, the conduct complained of must be analyzed to determine whether or

3.1.2 Association of South-East Asian Nations (ASEAN)

Indonesia, Singapore, Thailand and Vietnam have at present economy-wide

The TRIPs Agreement builds on and works in conjunction with existing

Integrated Circuits.13 In addition, the TRIPs Agreement requires detailed

3.1.3. East African Countries (EACs)

There seems to be no being universally accepted definition of ‘counterfeits’.

This definition makes the element of fraud essential in Defining a counterfeit

From an intellectual property perspective, counterfeits are defined in Article

Governments should ensure that their counterfeit laws continue to protect

counterfeit laws where this relates to determinations on counterfeit medicines. It is

Holding an intellectual property right does not itself constitute an abuse of a

There have been a number of cases on the question of whether a dominant

The reciprocal representation agreements, where collecting societies enter into

artists represented by the participating societies, continue however to be a legitimate

3.3 UNITED STATES OF AMERICA

3.3.1 Development of Anti-trust Law

3.3.2 Interface between Anti-trust Law and IPR

The essence of these guidelines was to accentuate the nexus between

• Intellectual property and other forms of property should be placed on an equal

The three distinct markets in which competition may be affected by a licensing

3.3.3 The Rule of Reason

Anti-trust scrutiny of licensing arrangements would mainly arise when they

The anti-trust safety zones related to licensing transactions created a safe

3.3.4 Competition Advocacy in USA

Competition advocacy is an important aspect of a competition policy in

problems. Affirming the importance of such activities in relation to intellectual

3.4.1 Anti-Competitive Agreements

Anti-competitive agreements are defined as any arrangements or

Apart from that, it has no mention of exhaustion, parallel importation or

3.4.2 Abuse of Dominance

According to Section 4 of the Competition Act 2002, no enterprise shall abuse

3.4.3 Combination Regulation

drug and chemical patents to seven years. Since pharmaceuticals is a knowledge-

3.4.4 Competition Advocacy

Competition Advocacy is one of the main pillars of modern competition law

Commission of India (CCI) to undertake advocacy for promoting competition.85 The

The importance of advocacy activities by competition agencies is aimed at

Competition advocacy can include public education activities, studies and

Broadly speaking, intellectual property right lessens competition while competition

a right, if a prohibited trade practice is visible to the detriment of competition in the

3.4.5 Application of Section 3 and IPR’s

Nothing contained in this section shall restrict-the right of any person to

(a) Copyright Act, 1957 (14 of 1957)

A few such practices are described below:

3.4.6 Penalty Provisions

The Commission is empowered to inquire into any unreasonable conditions

In case of abuse of dominant position under section 4 by virtue of an IPR by an

3.4.7 The Interface Analysis: