By Kee-Hong Chun, Attorney at law
The intersection between competition law and intellectual property law has been a contentious issue and one that is currently increasing in Korea.
The Korea Fair Trade Commission (“KFTC”) recently recognized the abuse of intellectual property rights as a priority for enforcement. To this end, the KFTC amended the “Guidelines on the Examination of the Exercise of Intellectual Property Rights”, which came into effect on April 7th, 2010, to provide guidance and set forth scenarios illustrating the possible unfair exercise of intellectual property rights in licensing (including cross-licensing), patent-pooling and standard-setting activities. In 2010 and 2011, the KFTC conducted intellectual property right abuse surveys in the pharmaceutical, IT, chemical and machinery industries.
On January 17th, 2012, the KFTC further announced the new “Guidelines for Fair Patent License Agreements”, which aimed to prevent unfair practices and provide practical support in the licensing of intellectual property rights. As an added step in its endeavor to deter abuse of patent rights that may take place in connection with the adoption of a patented technology as an industry standard, the KFTC promulgated the “Model Operation Standards for Standard-Setting Organizations” on January 31st, 2012. It is important to note that these guidelines may still be relevant to a company even if the company does not participate in any standard-setting activities within Korea because the guidelines are not intended to be applied to standard-setting organizations the operate exclusively in Korea.
In light of the fact that the KFTC is attempting to enforce competition law in this area more actively (as demonstrated by the recent amendments to the guidelines and the KFTC’s intellectual property right abuse surveys in 2010 and 2011), it is likely that there will be more developments through the KFTC's investigations and examinations of anticompetitive practices involving the use and abuse of intellectual property rights in the future.