The Supreme Court’s disposal of CCI v. Ericsson has triggered significant debate over the respective roles of patent law and competition law in regulating SEPs. Brian Scarpelli explains how this decision creates a crucial policy moment for India to clarify the role of its legal framework in addressing anticompetitive SEP licensing practices.
Brian Scarpelli is Senior Global Policy Counsel at ACT | The App Association, where he works on a diversity of legal and policy issues impacting mobile app development companies, including intellectual property, broadband access, competition, privacy, cybersecurity, and other areas. Prior to ACT, Brian worked for two telecommunications standard-setting organizations, the Alliance for Telecommunications Industry Solutions and the Telecommunications Industry Association. The views in this post are his own.
India’s Defining Moment on SEPs: The Supreme Court’s Decision Opens the Door for Policy Leadership
By Brian Scarpelli
The Supreme Court of India’s conclusion in Competition Commission of India v. Ericsson has sparked a debate across the technology, legal, and policy communities in and outside of India. While some have rushed to characterize it as a full “win” or “loss” for either patent law or competition law, the reality is more nuanced, and the opportunity it presents is underappreciated.
In short, the Supreme Court’s handling of the case has left a crucial policy question unanswered: what should the respective roles of India’s competition and patent frameworks be in addressing harmful and anticompetitive standard essential patent (SEP) licensor conduct? By keeping the question of law open and refraining from establishing a precedent, the Court created an opportunity and an imperative for policymakers to bring clarity and balance to SEP licensing.
The Background: The CCI v. Ericsson Case and Its Unresolved Legacy
The conduct at issue in this case started more than a decade ago, when Indian smartphone manufacturers, including Micromax, Intex, and iBall, complained to the Competition Commission of India (CCI) that Ericsson, a SEP holder, was imposing unfair and discriminatory licensing terms for its SEPs in key standardized technologies like GSM, 3G, and 4G, despite Ericsson’s voluntary promises to make those licenses available on fair, reasonable, and non-discriminatory (FRAND) terms. Notably, these Indian firms showed that Ericsson’s royalty demands were calculated on the end-product price, rather than the smallest saleable component using the patented technology. This resulted in inflated costs that disproportionately hurt Indian manufacturers.
What happened then?
- CCI opened investigations under Section 4 of the Competition Act, 2002 for abuse of dominance. Ericsson challenged CCI’s jurisdiction, arguing that licensing conduct was a matter governed by the Patents Act, 1970, and fell exclusively under the Controller General of Patents.
- In March 2016, the Single Bench of the Delhi High Court held that the CCI has the jurisdiction to investigate and pass orders in cases involving patent use and enforcement.
- In July 2023, a Division Bench of the Delhi High Court held that the Patents Act should take precedence over the Competition Act in cases involving patent use and enforcement.
- CCI appealed, asserting that the exercise of patent rights, especially in standard-driven markets, must remain subject to competition law to prevent monopolistic abuse.
When the case reached the Supreme Court in 2025, the Court declined to overturn the High Court ruling, dismissing the Special Leave Petition (SPL) via a non-speaking order. The dismissal was based on the settlement between the original parties, with the Court stating that “if there is any questions of law involved in this litigation, the same are kept open to be agitated in some other appropriate case”.
Legally, this non-speaking order holds significance. As established in Kunhayammed and Ors. v. State of Kerala and Anr., (2000) 6 SCC 359, a non-speaking order is not “a declaration of law by the Supreme Court under Article 141 of the Constitution for there is no law which has been declared.” Further, in the matter Khoday Distilleries Limited v. Sri Mahadeshwara Sahakara Sakkare Karkhane Limited, Kollegal, (2019) SCC 376, the Supreme Court held that the dismissal of an SLP is merely a refusal by the court to exercise their discretionary jurisdiction and does not constitute a binding declaration of law under Article 141, as the court did not adjudicate on the merits.
Since the question of the law is kept open, it implies that the Supreme Court did not rule out competition law’s role in SEP regulation nor did it preclude CCI from addressing anticompetitive SEP licensor conduct—and that the Court might decide on such issues in the future. Accordingly, the Delhi High Court Division Bench’s judgement is confined to that specific case and is not nationally binding precedent, though it may be persuasive.
Recently, the National Company Law Appellate Tribunal (“NCLAT”), in Mr. Swapan Dey v. Competition Commission of India, Competition Appeal (AT) No. 5 of 2023, held that the Patents Act prevails over the Competition Act, relying on the Delhi High Court’s judgment and without addressing the Supreme Court’s explicit reservation of the legal question. But even more recently, the Supreme Court has agreed to hear an appeal against the NCLAT order, which presents the possibility that the long-pending question of whether CCI has jurisdiction to investigate allegations of abuse of dominance or anti-competitive practices by patentees exercising their rights under the Patents Act could be settled. Until this decision is issued, there is a risk that tribunals may misapply the law and refuse to address competition law issues arising out of patent rights in future cases.
The Opportunity Before Policymakers: Clarifying the Relationship Between IP and Competition
The Supreme Court’s decision is perhaps an invitation for policymakers to step forward and clarify the roles of both competition and patent law in preventing harmful SEP licensor abuses. With SEP litigation on the rise in India, policymakers’ failure to act will allow these anti-competitive abuses to stifle Indian growth and innovation, placing it at a greater disadvantage globally.
When patented technologies are incorporated into a technical standard, such as 5G, Wi-Fi, or video codecs, they become unavoidable for any company seeking to include the standards in their products. To prevent abuse of SEP holders’ inherently dominant position, standard-setting organizations (SSOs) have SEP holders agree to license their patents on FRAND terms.
Theoretically, the FRAND commitment should ensure that anyone can use a standard by obtaining the necessary licenses, while SEP holders receive appropriate compensation. In practice, however, SEP holders too often disregard their FRAND commitments, exploiting ambiguities in SSO patent policies and the plain meaning of FRAND. This abuse often takes the form of:
- Discriminating among licensees across the value chain by refusing to provide FRAND licenses;
- Systematically using threats of, or seeking, injunctions to coerce settlements;
- Insisting on bundling unrelated patents into licensing demands to inflate licensing costs; and/or
- Demanding excessive royalties detached from the true value of the patented invention.
These bait-and-switch anticompetitive tactics distort markets reliant on connectivity and interoperability standards and disproportionately harm India’s micro, small, and medium enterprises (MSMEs), which lack the resources or leverage to negotiate equitable terms. This conduct threatens several sectors relevant to India. For example, patent licensing pools are already actively licensing patents for smart meters and automotive technologies.
While government interventions should always be carefully considered and predicated on the demonstrated systemic harms, such SEP abuses have plagued the telecom sector for nearly 30 years. A well-calibrated policy is therefore necessary to protect Indian competition and innovation by ensuring that voluntary FRAND commitments are observed—meaning that promises made by SEP holders are promises kept.
The Critical Role of Competition Oversight
Even as the courts weigh jurisdictional nuances, the underlying logic of competition oversight remains indispensable. Competition law complements patent law by focusing on how ownership is exercised in the market. Where the patent system rewards innovation through exclusivity, the voluntary FRAND commitment is a promise not to exclude or suppress downstream innovation. The CCI’s mandate, protecting markets from abuse of dominance, is a much-needed check on widely-recognized anticompetitive SEP licensor conduct that affects entire industries, both established and nascent.
Competition authorities should continue to play a role in balancing SEP enforcement and FRAND obligations; indeed, CCI’s ceasing to pursue enforcement against anticompetitive SEP licensors would represent a stark withdrawal of global leadership by the Government of India. Competition enforcers in multiple jurisdictions have taken action to address harmful SEP licensor conduct, including in the U.S. (e.g., the Federal Trade Commission’s investigations into Bosch and Motorola) and the European Union (European Commission investigations into Motorola and Samsung). More recently, Brazil’s Administrative Council for Economic Defense has appropriately pursued anticompetitive SEP licensor behavior of Ericsson, even after the underlying commercial dispute was settled.
As India continues to grow its global position, it must plainly acknowledge that competition law has a legitimate and necessary role in addressing SEP licensor harms. The Supreme Court’s refusal to speak to this issue presents a critical and timely opportunity to advance new policy, providing clarity to all stakeholders and removing hurdles to progress and innovation across the Indian economy.
The Stakes for Indian MSMEs and National Competitiveness
It cannot be overstated how much India’s economic ambitions hinge on its MSMEs’ success, yet this community faces disproportionate challenges in raising capital and competing in emerging markets. Opaque, inflated, and exclusionary SEP licensing practices add to these challenges. While MSMEs are the first to feel the impact, the harm of decreased competition is passed down to Indian consumers in the form of higher prices and limited choice.
India needs a policy that balances domestic innovation with foreign investment. However, to date, the SEP holders—foreign companies and non-practicing entities—have targeted implementers, disregarding FRAND promises, extracting inflated royalties, and foreclosing opportunities for Indian companies. MSMEs are most vulnerable, losing their ability to compete, innovate, and scale across sectors from IoT and connected vehicles to smart manufacturing and healthcare technologies.
If left unchecked, potential anti competitive SEP licensor practices can undermine India’s vision of Atmanirbhar Bharat and its aspiration to become a global technology leader. Addressing these problems is a matter of economic sovereignty.
A Blueprint for Policy Action: Building India’s SEP Framework
It is time for India to translate this judicial ambiguity into policy clarity. A coherent national approach should establish how FRAND commitments, competition enforcement, and patent rights intersect.
ACT and other stakeholders propose several guiding pillars for such a framework:
- Affirm the complementary roles of IP and competition law.
Policymakers should explicitly recognize the role of competition law in preventing SEP licensing abuses. Clarifying this relationship in policy or legislative guidance would do much to eliminate jurisdictional uncertainty. - Codify clear FRAND principles.
Indian policy should define FRAND to mean that SEP holders must license to all willing implementers; that royalties must reflect the actual value of the patented invention, not its inclusion in the standard; and that injunctions are appropriate only in exceptional circumstances. - Institutional coordination through co-regulation.
Agencies such as the DPIIT, CCI, CGPDTM, and the Department of Telecommunications should establish structured cooperation (through formal references under Section 21A of the Competition Act or joint guidelines) to ensure coherent oversight of SEP licensing conduct. - Transparency and disclosure requirements.
SEP holders declaring patents to SSOs should disclose licensing terms, royalty methodologies, and transfer histories. - Support mechanisms for MSMEs.
Policymakers should establish a dedicated effort to support especially the MSMEs facing SEP licensing challenges. Without support, smaller innovators and critical sectors cannot effectively invoke their FRAND rights. Spreading awareness about SEP/ FRAND licensing nuances should also be an important objective for the government in this context. - Accountability for bad-faith practices.
SEP holders that engage in anticompetitive behaviors should face meaningful deterrents, including sanctions or public reporting obligations.
By grounding SEP policy in these principles, India can simultaneously protect IP rights, encourage open markets, and empower its domestic innovators.
The Path Forward: From Judicial Ambiguity to Policy Leadership
The Supreme Court’s decision has placed the onus on India’s policymakers to provide policy and guidance for stakeholders who depend on both the patent and competition systems functioning in harmony.
CCI v. Ericsson also underscores that the judiciary cannot and should not be the sole architect of India’s innovation policy. Indian policy leaders must now take the baton, crafting a framework that provides certainty for investors as well as clarity and fairness for any company looking to innovate with standardized technology.
India stands at a defining juncture. With its sizable MSME base, deep digital infrastructure, and growing technological influence, the country is uniquely positioned to lead. This is India’s moment to establish itself as a global benchmark for fair, innovation-driven SEP policy.
By clarifying the complementary roles of competition and patent law, supporting MSMEs, and ensuring FRAND commitments are meaningful and enforceable, India can secure its place as a technology leader that prizes both innovation and inclusion.
The question now is not whether competition law has a role—it is how India chooses to define that role.
