By Kim Tae-jong
The nation’s anti-trust watchdog said Wednesday that it will beef up the monitoring of multinational corporations to keep them from abusing their patents here amid growing intellectual property feuds between local and international companies.
The move comes at a sensitive time ― just days after Samsung Electronics suffered a setback in its patent dispute with Apple.
“We have launched an investigation into unfair practices regarding patents,” an official from the Fair Trade Commission (FTC) said. “Nothing specific has been found yet, but we will take a legal step against any irregularities.”
He said there are an increasing number of cases where multinational corporations abuse their intellectual rights, especially in fields such as information technology, medicine and machinery as local firms are vulnerable to patent lawsuits in those fields.
According to the Korea Intellectual Property Protection Association, the number of international patent lawsuits involving Korean firms has increased by over 80 percent from 154 in 2009 to 278 last year.
Patent lawsuits are increasing as domestic firms depend heavily on exports and many local firms produce patented products through licensing.
The FTC also plans to look into aggressive and allegedly unfair patent lawsuits filed by some multinational firms as a way to hinder the advance of Korean businesses in their markets or to profiteer by requesting too high licensing fees.
“The reason (behind the investigation) is that multinational firms have reportedly enforced their patents in an unfair manner through discriminative royalties policies, tie-in sales and unfair conditions in licensing contracts,” the official said.
In fact, Apple is being investigated by the FTC for forcing application developers to use Apple’s payment system when they register their products in its app store.
The FTC has also investigated Google for its alleged tie-in sales of a search engine program when it sells the Android operation system for mobile phones.
In the pharmaceutical sector, multinational firms have enjoyed even greater dominant positions as local firms heavily rely on the sales of generic drugs.
“The amount of royalties paid to multinational firms is huge. It is necessary to control unfair practices regarding patents. The FTC will also look into whether local conglomerates use unfair practices against small- and medium-sized firms regarding their patents,” the FTC official said.
According to recent data, local firms pay around 10 trillion won annually as patent fees to global firms.
But multinational firms criticized the FTC’s probe, arguing it is a political move.
“In a strict sense, it is much easier to infringe patents than to abuse patents,” an official from one firm said, who declined to be named. “I think the FTC’s probe is politically motivated because Samsung Electronics lost a crucial patent battle against Apple.”