European Commission investigates alleged abuse of dominance by Samsung

On 31 January 2012 the European Commission opened an investigation into Samsung’s practices relating to the use of certain of its standards-essential patent rights, which may distort competition in European mobile device markets in breach of Article 102 of the Treaty on the Functioning of the European Union (the EU competition rules on abuse of dominance).

The investigation seeks to determine whether Samsung is using such essential patents in contravention to its commitment given to the European Telecommunications Standards Institute (ETSI) to license any standards-essential patents relating to third generation (“3G”) mobile and wireless telecommunications system standards on fair, reasonable and non-discriminatory (FRAND) terms.  In particular, the Commission is investigating Samsung’s legal actions in various EU Member States (Germany, France, and Italy).  Last year, Samsung sought injunctive relief against competing mobile device makers, including Apple, based on alleged infringements of certain of its patent rights that it declared were essential to implement 3G standards.

Thus, the Commission will examine whether such behavior, while apparently legitimate, amounts to an abuse of a dominant position insofar as Samsung has failed to honor its FRAND commitments.  Standard setting organizations, including ETSI, require the owners of patents that are essential for the implementation of a standard to commit to license these patents on FRAND terms in order to ensure effective access to the standardized technology.

The Commission notes that, in order to guarantee undistorted competition and to reap the positive economic effects of standardization, it is important that FRAND commitments be fully honored by the concerned undertakings. [Gabriele Accardo]