Competition in Information and Computer Technology Markets: Intellectual Property Licensing and s 51(3) of the Trade Practices Act 1974

Abstract

Intellectual property licensing presents competition lawyers and regulators with something of a puzzle. The practice is both pervasive and necessary and yet will often take forms which on their face appear to run foul of the sometimes broadly expressed prohibitions through which most jurisdictions enact their competition policy. While most of these prohibitions have long been tamed into rules of reason, they can, as currently in Australia still induce panic (a panic largely borne of confusion) in right holders and licensees who confront them for the first time. Panic rises to even higher levels when intellectual property owners are threatened with the sudden removal of the statutory shield which up until now has protected most (but significantly not all) of their dealings with licensees from the attention of regulators and competitors. Feeling more than usually exposed by this proposed legislative disarmament are suppliers of computer software and other forms of information and communications technology, accustomed as they have been to the steady expansion of legal protection (the lifting of parallel importation restrictions being one of the rare examples of retreat) rather than the contraction they wrongly assume to be imminent unless fended off by intensive lobbying. How justified are these fears? For the most part, not very. Only where the Trade Practices Act 1974 imposes per se liability do the lobbyists have a case and here the proposed changes improve the position of right holders rather than the contrary. Indeed if there is a criticism to be made of the suggestions of the Intellectual Property and Competition Law Review Committee's (the 'Ergas Committee') in its Review of Intellectual Property Legislation under the Competition Principles Agreement and the government's response to them ('Government Response') is that the changes are prompted by long standing problems with the whole of Part IV itself (still under review at the time of writing).