Thanks to cutting-edge digital technology, cars are increasingly like “smartphones on wheels”, so manufacturers need to have access to the latest patented 4G and 5G technologies essential to navigation and communications.
But often the companies that hold the patents are reluctant to license them because manufacturers will not accept the high fees involved, which leads to patent disputes and licensing rows.
Carmakers and their suppliers are becoming more conscious of the role of competition authorities and the legal options available if patent owners abuse their monopolistic rights.
In the EU there is a robust body of competition law designed to fight cartels and monopolistic behaviours.
One such battle involves Nokia, a Finnish telecoms company, over licences for patented technologies that are essential to standards for navigation, vehicle communications and self-driving cars.
Specifically, a group of 27 companies, including Daimler, Ford, BMW, Dell, Cisco, Continental, Lenovo and Sky, has complained to the European Commission about alleged abuses of the patent system that jeopardise the development of self-driving vehicles and connected devices.
Nokia owns several patents protecting technologies on which current mobile phone standards are based, such as wifi, 3G, 4G, and the latest 5G.
This means that companies requiring these technologies for their products must obtain a licence from the Finnish company.
Nokia’s patent enforcement strategy appears to be quite aggressive; it has begun several legal actions, particularly against Daimler, claiming patent infringement on the basis that the defendants were using its patented technology without a licence.
Nokia’s refusal to license such patents has been disputed by a variety of industry players.
Complaints have been lodged with the European Commission by Daimler, electronics company Bury Technologies, automobile parts manufacturer Continental as well as automotive supplier Valeo and digital security company Gemalto.
All claim that Nokia has refused to license their patents on the principle of “fair economic conditions”, which means they believe the licensing fees demanded by Nokia are too high and unfair, amounting to an illegal abuse of its dominant position and violating EU competition rules.