THE LIST OF PROHIBITIONS FOR SUBJECTS OCCUPYING DOMINANT POSITION HAS BEEN SET

The issuance of a warning should be the mandatory phase of antimonopoly response measures that is also proposed to be established by the document.

In the modern world in the context of digitalization, objects of intellectual property are becoming increasingly important in the circulation and functioning of commodity markets.

At the same time, the results of intellectual activity can be used not only for the purpose of innovative development, but also for the purpose of monopolizing commodity markets and limiting competition.

Nowadays, many states have agreed the application of antimonopoly law to actions and agreements related to the exercise of exclusive rights to the results of intellectual activity, if such rights are used to limit competition (USA, European Union, Japan, etc.).

The possibility of limiting exclusive rights to protect competition is provided for by the norms of international law.

Thus, the article 40 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) provides states with the right to establish independently in their national legislation types of licensing practices that may result in abuse of rights to the results of intellectual activity and have an adverse impact on competition in the relevant product market.

In the development of these provisions, article 10 of the Civil Code of the Russian Federation prohibits to use civil rights to limit competition, as well as abuse of a dominant position.

At the same time, the provisions of [1] of the Law on Protection of Competition block the implementation of this prohibition in the antimonopoly law.

The practice of antimonopoly authorities indicates an increasing share of facts in which the actions of rights holders are considered as having signs of limiting competition, but cannot be prevented or suppressed by the norms of the Russian antimonopoly law because of direct exceptions.

For example, a dominant entity with exclusive rights may set requirements in a license agreement [2] on the purchase of goods, works, services, including those that are the result of intellectual activity or created with their use, not related to the subject of the license agreement (the so-called “binding practice”); establish a prohibition for the counterparty to conclude contracts with competitors of the rightsholder (the so-called “provisions on the avoidance of competition”); may create discriminatory conditions. The largest IT companies are not limited in the fees amount charged to software developers through their platforms and operating systems. Moreover, such platforms and operating systems have signs of a dominant position.

The draft law developed by the FAS Russia seeks to ensure the protection of competition in the commodity markets of the Russian Federation and the interests of consumers in cases of abuse of their exclusive rights by copyright holders. The media’s thesis that the field of application of the law will be limited to medicines and internet platforms is incorrect.

The draft law proposes to establish in the Law on Protection of Competition a prohibition on the actions of an economic entity occupying a dominant position within the framework of disposing of its exclusive rights to the result of intellectual activity by granting the right to use it to other economic entities [3].

The list of actions included in the projected prohibition is determined based on the specific practices of abuse of intellectual rights formed in Russian and foreign practice.

It is also proposed to establish that in cases of detecting signs of such violations, the issuance of a warning should be a mandatory phase in antimonopoly response measures.

“The adoption of the draft law will have positive socio-economic consequences because it seeks to increase the level of protection of consumers' interests from monopolistic activities in the form of abuse of rights to the results of intellectual activity. But at the same time does not reduce the level of legal guarantees of intellectual rights exercised in limits defined by civil law,” Sergey Puzyrevsky, Deputy Head of the FAS Russia said.

[1] part 4 of article 10 and part 9 of article 11

[2] outside of those powers that are determined by civil law regarding licensing agreements

[3] on condition that such use is connected with the introduction into circulation or is the introduction into circulation of goods by a given economic entity on the product market in which it occupies a dominant position. Such actions lead or may lead to the prevention, elimination or restriction of competition and (or) infringement of the interests of other persons (economic entities) in the field of entrepreneurial activity or an indefinite circle of consumers, as well as to fix a specific exhaustive list of such actions