Frand and Compulsory Licenses: Analysis and Comparison

Abstract

Licenses are important tools to capture the full market value of many of the intangible assets. In that, licenses serve an important function in all areas of intellectual property rights to effectively capitalize on the value of the property. This paper compares two different forms of licenses being FRAND and compulsory license. Both forms of licenses are critical to achieve access to otherwise difficult to access technologies. The FRAND licenses have been widely embraced, especially in the software, mobile phones, and communications sectors. Compulsory licenses have been sparingly used by Governments where the public’s need for the invention was considered to over-weigh the needs of the patentee, essentially for pharmaceuticals. Compulsory licenses have been universally criticized for being an imposed burden on the patentee. In comparing these two forms of licenses, this paper outlines that despite the obvious differences operationally both of these forms of licenses have stark similarities and highlights areas where compulsory licenses operate more efficiently. In doing so, this paper highlights that perhaps each of the forms of licenses can borrow from the other to minimize the weaknesses to ultimately enable more access for critical invention.