UK tests an early FRAND opinion service for standard-essential patent deals

The story

The UK Intellectual Property Office has opened an eight-week call for evidence on a possible new way to defuse disputes over standard-essential patent licences before they reach court. The proposal is for an IPO-led opinion service that could assess whether a specific licensing offer, counter-offer or negotiating position falls within a plausible range of fair, reasonable and non-discriminatory terms. The consultation began at midday on October 20 and closes on December 15, 2026.

The distinction between a proposal and an operating service is essential. The government says no decision has been taken to create the mechanism. It is testing demand, scope, fees, participation rules, evidence requirements and confidentiality arrangements. Responses could lead to a pilot, a redesigned concept, complementary measures or no service at all.

Standard-essential patents, or SEPs, protect inventions that must be used to implement a technical standard. They are central to mobile communications and increasingly relevant to connected vehicles, streaming, industrial equipment, energy systems and internet-of-things products. Standards bodies commonly seek commitments from SEP owners to offer licences on FRAND terms, but the word “reasonable” does not produce a single published tariff. Portfolio strength, geographic coverage, comparable agreements, royalty bases and the value contributed by the standard can all affect the range.

That complexity can put smaller implementers at a disadvantage. They may receive a demand covering a large patent portfolio without the licensing history, economic expertise or access to confidential comparables available to experienced multinational negotiators. The IPO says earlier consultation evidence pointed to a need for a quicker, less adversarial and less expensive way to test negotiating positions before parties turn to mediation, arbitration or litigation.

Under the working concept, the service would be voluntary, independent, advisory and non-binding. It would examine defined economic, valuation and licensing evidence supplied in an active negotiation and issue a written opinion on whether the position sits within a plausible FRAND range. It would not impose a licence, award damages or prevent either party from using another dispute-resolution route. Access might remain available even while litigation or arbitration is underway.

The proposed boundary is equally important: the IPO would not determine whether a patent is actually essential to a standard, whether it is valid, whether a product infringes it or whether either party is legally liable. An opinion could therefore say that a rate is economically plausible while leaving major technical and legal questions unresolved. That may still narrow a dispute, but it would not convert a contested portfolio into proven rights.

The consultation exposes the design problems that could decide whether the idea works. The IPO asks whether one party should be able to request an opinion, whether both sides must participate, what negotiation steps should come first and how non-participation should be reflected. It also asks about fixed, tiered or value-linked fees and whether SMEs need reductions. A service intended to improve access could miss its target if the required economic reports and legal preparation cost more than the official fee.

Evidence and confidentiality present another tension. Credible FRAND analysis often depends on comparable licences, royalty calculations and negotiation correspondence that companies treat as commercially sensitive. The IPO is considering outcomes ranging from fully confidential opinions to redacted decisions or anonymised public summaries. Keeping everything private could protect participants but add little transparency to the wider market; publishing too much could discourage parties from supplying the best evidence.

Independent analysis from Pinsent Masons describes the wider policy direction as targeted early intervention rather than a wholesale rewrite of the UK SEP framework. The government has stepped away from a standalone rate-determination track in the Intellectual Property Enterprise Court after consultation evidence did not establish it as a clear and workable route. The opinion-service concept is narrower: an independent reference point designed to support bargaining rather than a tribunal that fixes terms.

INNOVOX analysis: the most valuable output may not be a definitive number, which a non-binding service cannot guarantee. It may be a disciplined process that forces both sides to identify assumptions, comparable deals and valuation methods early. That can make information asymmetry visible and narrow the distance between offers. The risk is that parties use a one-sided or lightly evidenced opinion as leverage without resolving essentiality or validity. Credibility will require balanced participation rules, experienced valuation staff and explanations that show how the range was reached.

What to watch next is the evidence the IPO receives by December 15. The decisive questions are whether experienced licensors will disclose useful comparables, whether implementers would pay for an opinion, whether one-party requests can be fair, and whether confidential inputs can produce public learning. If the government proceeds, the shape of any pilot—not the label—will determine whether the service becomes a practical off-ramp from expensive disputes or simply another advisory step in already complex negotiations.

INNOVOX analysis

The proposal targets the information gap in SEP negotiations rather than rewriting patent rights. Its usefulness will turn on whether the IPO can examine confidential comparable licences at a price smaller implementers can afford—and whether sophisticated licensors and licensees regard an advisory range as credible enough to change bargaining behaviour.

What to watch

Watch the evidence submitted by December 15, the proposed fee and confidentiality model, whether one party could obtain an opinion without the other’s participation, and whether any pilot publishes anonymised reasoning that can improve market transparency without exposing licence terms.