Diffusion of Collaborative Standards and EU Competition Law

Diffusion of Collaborative Standards and EU Competition Law

Haris Tsilikas (Max Planck Institute for Innovation and Competition, Munich, Germany)
Copyright: © 2017 |Pages: 11
DOI: 10.4018/IJSR.2017010104
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Innovative standards bring about substantial benefits to consumers, such as lower prices, a wider variety of standard-compliant products to choose from and more innovation. Although standardisation is an efficient process, still making sure that the benefits of standardisation are distributed widely remains a challenge. This article is about how the EU competition law has had a significant impact on the development of collaborative standardisation, with a view to ensure that standards are diffused as widely as possible and that consumers internalise a fair share of the value of innovative standards. Arguably EU competition policies in collaborative standardisation have not always been an unqualified success. Yet, the CJEU Huawei ruling has been a positive step forward for EU competition law, successfully striking a fair balance between the interests of various stakeholders and aligning incentives of patent holders and implementers to conduct licensing negotiations in good faith and to refrain from practices that could be characterised opportunistic.
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Collaborative Standards And Ssos

The term standard refers to a set of specifications outlining product characteristics, processes and formats to which all products under its jurisdiction must conform; standardisation is the process pursuing such conformity (Tassey, 2000, p. 588). Owing to their non-rivalrous and non-excludable character, standards could be considered public goods (Lecraw, 1984, p. 509; Simcoe, 2014, p. 100). Thus, the competitive supply of standards may suffer from the typical free riding problem marring the supply of all public goods: the positive externalities of standardisation cannot be fully internalised by the producers of standards resulting in undersupply (Simcoe, 2014).

Collaborative standards emerge through committee action, coordinating industry stakeholders by means of negotiations and deliberations. Standards development is organised within standards-setting organisations (SSOs), voluntary industry bodies governed by rules and regulations agreed upon by their members, which include technology contributors and implementers of standards (Epstein, Kieff, & Spulber, 2012). SSOs are of varying size, membership and formal recognition. In the ICT sector, around 840 SSOs are estimated to be involved in collaborative standardization (Bekkers & Updegrove, 2012, p. 6). Although largely a market-driven process, public interest considerations are also relevant and committee negotiations often bear a more political imprint.

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