The UK Intellectual Property Office (UK IPO) has launched a consultation proposing a new specialist route at the Intellectual Property Enterprise Court (IPEC) to determine licence rates for standard essential patents (SEPs), in a bid to increase pricing transparency and help drive down costs for businesses.
The route, which would be called the Rate Determination Track (RDT), is one of a number of proposals being considered in the consultation as part of a drive to boost innovation within the tech sector in light of evidence that businesses that negotiate SEP prices privately can dramatically overpay for licences they may not even need.
The UK IPO is also considering mandating disclosure of standard-related patent information through its patent search tool, the One IPO Search service.
The RDT would provide licence rates for SEP portfolios on a case-by-case basis, supplementing the existing small claims and multi-claims track at the IPEC to ensure, the office hopes, cost-effective access for businesses.
The office suggests that by using pre-litigation protocols, simplified procedures, specialists and streamlined case management, the RDT would focus on the narrow issue of rate setting.
The new route would give businesses of all sizes the opportunity to quickly and affordably settle disputes about a rate for SEPs they need to license. The publication of rates determined via this route should also increase transparency and efficiency, as a starting point for commercial negotiations, says the UK IPO.
People increasingly interact with SEPs in everyday life – in smartphones and telecommunications networks, cars, home appliances, UAVs (drones), smart meters and medical devices.
Currently, if a patent is found to be essential to the implementation of a standard, the patent holder has to license it on terms that are considered fair, reasonable and non-discriminatory (FRAND). But the licence terms reached are confidential between businesses, and SEP litigation can be lengthy and costly.
Lack of pricing transparency means that licensees can overpay for licences, and the UK IPO says it has seen evidence emerging through litigation that licensing offers made by SEP holders “have exceeded court adjudicated rates by 4-500 times”.
The proposals aim to increase transparency and reduce friction around SEP licensing, particularly for SMEs, as their numbers continue to grow in the Internet of Things sector.
The UK IPO notes that not all licensees, and especially SMEs, can currently afford to challenge suspected supra-FRAND rates through litigation.
Furthermore, evidence suggests that only about 25-40% of all declared SEPs are truly essential to a given standard.
Exploring the suggestion of including more SEP information in its One IPO Search tool, it proposes an additional search function to the service for standard-related patents.
Introducing an additional search function in the service would enable users to search for patents that relate to technical standards, just as they can for supplementary protection certificates and green channel applications/patents.
Feryal Clark, minister for intellectual property, said the consultation would help make the licensing of technologies that power “our connected future”, from 5G and electric vehicles to smart manufacturing and healthcare, “more straightforward and accessible – driving innovation, reducing costly litigation and helping UK firms lead in developing the technologies of tomorrow”.
The UK IPO is also consulting on other areas of the SEP ecosystem to determine if any government intervention is needed. Measures being considered include how existing pre-action protocols under the Civil Procedure Rules are being used in alternative dispute resolution (ADR) and whether they could be successful in SEP negotiations.
It is also seeking to understand the current provision of ADR services that can resolve SEP disputes, and the extent to which they are used and accessible for all businesses, especially smaller businesses.
UK IPO chief executive, Adam Williams, said: “By combining possible regulatory interventions with market-driven solutions, we want to create a framework that enhances the UK’s competitiveness while ensuring fairness and transparency across the technology value chain.”
Bobby Mukherjee, president of the Chartered Institute of Patent Attorneys, added: “CIPA members welcome the opportunity to participate in this evidence-led consultation openly, reflecting the spectrum of views from SEP rights holders to implementers.”
The consultation is open until 7 October 2025.
Until now, the IPO has worked on non-regulatory measures. It introduced an SEP Resources Hub last July. The hub is an educational resource for UK businesses, providing information to help them navigate the licensing ecosystem.
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