China IPR

Comments of George Mason University on Antitrust Questionnaire

Attached are the comments in Chinese and English of George Mason University’s Global Antitrust Institute on the Questionnaire on Intellectual Property Misuse Antitrust Guidelines distributed by NDRC.

The Director of the GAI is Joshua D. Wright, a former U.S. Federal Trade Commissioner. The GAI’s International Board of Advisors is chaired by Douglas H. Ginsburg, a Senior Judge on the United States Court of Appeals for the District of Columbia, and a Professor of Law. Koren W. Wong-Ervin is a former Attorney Advisor to then-Federal Trade Commissioner Joshua D. Wright and is also an author of this comment.

These comments recognize the pro-competitive effects of IP, and are a very useful summary of US practice in this area. The authors’ summarize their approach as follows:

“While the U.S. antitrust agencies apply the same general antitrust analysis to matters involving IPRs as to any form of tangible or intangible property, that is not to say that they do not recognize the important distinguishing characteristics of IPRs.  For example, the inventions and works protected by IPRs are non-rivalrous.  Thus, one firm using a specific IPR does not diminish the ability of another firm to use the same IPR.  Also, the cost of having another firm use an existing IPR is effectively zero.  As a consequence, from a static welfare perspective, it is desirable to disseminate IPRs to every firm (or consumer) that has a positive valuation for the IPR.  Of course, doing so would create a strong disincentive to innovate in the first place, to the great detriment of dynamic efficiency, which refers to the gains that result from entirely new ways of doing business.  While static efficiency may increase consumer welfare in the short run, economics teaches us that dynamic efficiency, including societal gains from innovation, are an even greater driver of consumer welfare.”

I hope that these comments by leading experts in the field are  helpful to Chinese colleagues, and I appreciate the transparency of the commentators in providing them to this blog.

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