Common use of The EU Clause in Contracts

The EU. On 1 May 2004, the new EU Regulation on Technology Transfer Agreements en- tered into force.96 This Regulation is the result of the EU’s overhauling and “mod- ernizing” its entire enforcement system as well as reconsidering its policies vis- a`-vis horizontal and vertical cooperation, and, in particular, its policy vis-a`-vis licensing agreements.97 By a “more economic approach” the Regulation clearly 91 See ▇▇▇, Newberg, U.S. Enforcement Approaches to the Antitrust-Intellectual Property Interface, in Anderson, Gallini, at 343, 347 et seq. 92 See Section 5.2. 93 OECD, Guidelines for Multinational Enterprises – Revision 2000–, Paris 2000, at 26 (text), 53 et seq. (commentary). 94 For the various approaches within the WTO see ▇▇▇▇▇, Globalization, Competition and Trade Policy: Issues and Challenges, in Za¨ ch, 3, 25 et seq.; ▇▇▇▇▇▇▇▇▇▇, Competition-oriented Reforms of the WTO World Trade System – Proposals and Policy Options, ibid. at 43 et seq. 95 See WTO, Report of the Working Group on the Interaction Between Trade and Competition Policy to the General Council of December 8, 1998 (WT/WGTCP/2); WTO, Annual Report 1997, 72; Heinemann, Problems of Intellectual Property Rights and Competition Policy – The Approach of the WTO Working Group on Trade and Competition, in Za¨ ch, at 299 et seq. 96 See Official Journal of the European Union (OJEU) 2004 L 123/11. See also above, under Section 3 of this Chapter. 97 See European Commission, Commission Evaluation Report of 20.12.2001 on the Transfer of Technology Block Exemption Regulation No. 240/96 (Technology Transfer Agreements under Article 81) (COM(2001) 786 final). See <▇▇▇▇://▇▇▇▇▇▇.▇▇.▇▇▇/eur-lex/en/com/rpt/2001/com2001 0786en01.pdf>. distinguishes between licensing agreements concluded between competitors and those between non-competitors. A broadly defined (automatic) block exemption is granted, for competing undertakings, where the combined market share of the un- dertakings party to an agreement does not exceed 20% of the affected relevant tech- nology and product market. For non-competing undertakings, the automatic block exemption is granted where the market share of each of the parties to the agree- ment does not exceed 30% of the affected relevant technology and product mar- ket.98 Above these market shares even horizontal agreements would still benefit from a broad rule of reason analysis of each individual case,99 the more economic approach being oriented toward an efficiency test similar to that applied in the U.S.100 A further requirement is that the agreement does not fall under one of the specifically listed hardcore restrictions.101 Finally, the Regulation provides for the possibility to refuse the block exemption to individual obligations in other- wise exempted agreements.102 In sum, the EU, though maintaining a critical stand as regards tight ▇▇▇▇▇▇▇- ▇▇▇▇ restrictions, has approximated its enforcement policy to that of the USA. It remains to be seen what this convergence of the approaches of the two leading antitrust law systems means for the many countries which, upon invitation by the EU or the USA, by self interest and/or in the hope of the establishment of interna- tional competition rules, have given themselves competition rules of their own or have revised them recently with a view to enhancing their effectiveness.103 With respect to the EU’s external relations, the EU has a regular practice of including the same or similar rules of competition, which it follows under Arti- cle 81, et seq. of the EC Treaty, in all multilateral or bilateral free trade treaties, such as the Agreement on the European Economic Area or the Europe Agreements concluded with Eastern European Countries in view of their accession to the Union.104 In these cases, the Community’s competition policy has to be accepted 98 See Article 3, paragraphs 1 and 2 of the EU Regulation on Technology Transfer Agreements.