The UPC’s role in global technology dispute resolution is emerging

While it is too early to determine any trends, these decisions provide some insights into how the UPC might approach ‘FRAND’ determinations in SEP disputes, and the role the court could play in global technology disputes when compared with well-established forums such as the courts in UK and China, which are willing to set a global FRAND rate. 

SEP and FRAND actions before the UPC   

SEPs are patents that protect technology believed to be essential to implementing a technical standard. In other words, you cannot operate a standard-compliant device without necessarily using the patented invention. Standards are important for interoperability in industries including telecommunications, the Internet of Things, as well as in other sectors that use smart technologies, such as energy and infrastructure. 

Standards are developed by businesses working together under the auspices of standard-setting organisations (SSOs), such as the European Telecommunications Standards Institute (ETSI), which oversees the development of communications standards vital to many businesses. SSOs like ETSI typically require SEP rights holders to make SEPs available for others to use by way of a licence on fair, reasonable and non-discriminatory (FRAND) terms. 

Disputes on what constitutes ‘FRAND’ often arise in the context of SEP licensing negotiations. Litigation can then follow if the parties are unable to agree. Disputes have arisen in many jurisdictions including the UK, Germany and France, as well as in the US and China, and now, before the UPC. 

The UPC has, so far, issued three substantive decisions in SEP disputes in the cases of Philips v Belkin, Panasonic v Oppo, and Huawei v NETGEAR.   

Adopting the German national approach to FRAND? 

The three decisions issued to-date have all been before a German local division (LD) of the UPC. A further case – KPN v Oppo – has been brought before The Hague LD. In each of the three decisions issued so far, by the Munich LD in the case of Philips v Belkin, the Mannheim LD in the case of Panasonic v Oppo, and the Munich LD again in the case of Huawei Technologies v NETGEAR), the SEP holder prevailed. 

While no FRAND defence was raised in the UPC’s first SEP decision, Philips v Belkin, in the two subsequent cases in which it was raised, the UPC took a similar approach to considering the defence as has been taken by the German national courts. For example, the Mannheim LD took an SEP-holder friendly position to the interpretation of the decision issued by the EU’s highest court, the Court of Justice of the EU (CJEU), in the case of Huawei v ZTE in 2015, similar to that taken by the German Federal Court of Justice in the case of Sisvel v Haier. This is perhaps unsurprising, given the identity of the judges involved and their previous involvement in determining FRAND cases in Germany.   

That the UPC found in favour of the SEP holders in all three decisions, and demonstrated a willingness to grant injunctions, will inevitably buoy SEP holders, but it is far too early to identify any trends. It is likely that UPC successes in the longer term will more likely be balanced between SEP holders and implementers. This is supported by the fact that, outside the SEP/FRAND space, despite the early expectations that the UPC would largely be a pro-patentee forum, the position is far more nuanced, with the court not being afraid to revoke patents. In the life sciences sector, for example, in the case of Sanofi v Amgen, Amgen’s evolocumab/PCSK9 antibody patent was revoked by the Munich LD. In the case of Dexcom v Abbott, one of Dexcom’s continuous glucose monitoring patents was revoked by the Paris LD too.   

That said, there are some suggestions that some litigants have decided against bringing their strongest patents before the UPC, preferring to opt them out from the UPC’s jurisdiction and expose weaker patents instead to test the water. Some recent pro-patentee decisions by the UPC, including the Court of Appeal decisions in the cases of Fives v REEL and AIM Sport v Supponer, could possibly signal a longer-term move towards a system that is more favourable to patentees, and therefore to SEP holders. However, confident assertions of trends before the UPC will only be possible after the court issues more decisions where judges have shown their reasoning – which is essential to encourage parties to bring actions before it.  

How local or regional divisions of the UPC outside of Germany, and ultimately the UPC Court of Appeal, decide FRAND disputes, and whether such approach favours SEP holders or implementers, will be of interest to tech companies. However, the interplay between the UPC and the UK courts may also be relevant from a commercial perspective. 

Interplay with the UK  

The role of the UK courts in resolving global technology disputes, when there were ongoing parallel UPC infringement actions, is particularly pertinent following a number of recent decisions, most notably the English Court of Appeal’s decision in the case of Panasonic v Xiaomi. In that case, the court declared that willing parties in the circumstances would enter into an interim licence prior to a determination being reached around FRAND. While public sources report that the parallel UPC FRAND proceedings between Panasonic v Xiaomi were put on hold at the last minute, the UPC did issue a decision in the related proceedings between Panasonic and Oppo, although this had no real commercial relevance as a global settlement had already been reached.  

The scope of decisions of both national courts and the UPC has received much attention in 2025. In the case of BSH Hausgeräte v Electrolux, the CJEU held that courts in EU member states have scope to rule on the infringement of ‘foreign’ patents even when the validity of those patents is challenged. The CJEU also found that national courts of EU member states can determine infringement of patents in force in a non-EU country – a so-called ‘third state’ such as the UK – and can rule on the question of validity for the purpose of determining whether it is a defence to the alleged infringement. This ruling aligns with the UPC’s ‘long-arm jurisdiction’ decision in the case of Fujifilm v Kodak in which the Düsseldorf LD found that where a defendant is based in a UPC contracting member state, the UPC can determine claims of infringement of European patents in every country in which those patents apply – including the UK, as well as the Paris LD’s subsequent decision in Mul-T-Lock v IMC Créations.   

Future UK and UPC rulings, and how the courts interact with each other, will be monitored closely.  

Global rate-setting 

While the UK courts are willing to set FRAND rates, such as in the case of Unwired Planet v Huawei, the German courts are less keen, and have consistently declined to set global FRAND rates, focusing instead on the willingness of both parties to commit to a licence.   

Whether the UPC would be willing to set a global FRAND rate is, as yet, unclear.

On one hand, there are indicators that it will not. These include the fact that the majority of SEP proceedings pending before the UPC are pending before the German LDs, and the judges in the German LDs are the same judges who have resisted setting FRAND rates in national proceedings and have, so far, in Panasonic v Oppo and Huawei v NETGEAR, aligned themselves with, for example, the German approach to the interpretation of the CJEU’s case law from Huawei v ZTE.

On the other hand, comments made within, and the overall impression given by, the decision in Panasonic v Oppo, appear to suggest some willingness by UPC judges to do things differently to national courts and to set a global FRAND rate in appropriate circumstances.     

Assuming the UPC does decide to set a global FRAND rate, clarification of how it would do so would naturally be of great interest. The court’s consideration of comparable licences would inevitably be expected to play a central role.  

Costs and timeframes 

Despite initial impressions that UPC FRAND proceedings would be far cheaper than UK proceedings, the reality is that the costs are far more balanced. This is particularly the case given that English judges now favour hearing the FRAND trial first before technical trials commence, and the fact that the English proceedings are not as front loaded compared with UPC actions, which enables litigants to demonstrate their intent by engaging on a serious platform without the significant financial investment in court costs at an early stage.   

Further, the UPC aims to hand down first instance decisions within 12 to 14 months of proceedings being initiated, which it has achieved with some of its early substantive decisions. Despite efforts to increase judicial capacity at the German LDs, given the court’s current workload, maintaining this speed will undoubtedly be very challenging. Given the UPC’s commitment to reaching a decision within 12-14 months, UPC procedure may not, in reality, be equipped to undertake rate-setting as this process takes time. With that in mind, it would not be a surprise if the UPC does ultimately adopt a German-style approach to FRAND licensing.   

Given the UPC’s focus on expediency to enable commercial certainty, in the medium to long term, the UPC may adopt a similar approach to the UK and hear FRAND trials before technical trials. Whether this will make it more, or less, attractive to litigants is up for debate.     

Value of ADR 

The role of alternative dispute resolution (ADR) in UPC FRAND disputes has flown largely under the radar, but is nevertheless relevant. Although the UPC Patent, Mediation and Arbitration Centre (PMAC) is not yet operational, ADR already plays an important role in UPC proceedings, with the possibility of ADR frequently explored by UPC judges at interim conferences. If run in parallel with litigation, ADR could be another useful tool in encouraging parties to move towards settlement.    

Another tool in the armoury of tech patent litigants 

The UPC is an important tool technology businesses can deploy for resolving SEP and FRAND disputes. However, the fact that the UPC has only issued two FRAND decisions to date means that it is far too early to determine any trends and whether they favour SEP holders or implementers. It is also too early to say whether, or to what extent, the UPC will be influenced by decisions of national courts, including future UK rulings. 

While in time, the court’s approach will become clear, the UPC judiciary must continue to demonstrate clear and robust reasoning in all their decisions to encourage litigants to use the court.