In a series of recent SEP infringement cases involving companies such as Broadcom, Nokia, and ZTE, the 7th Civil Chamber of the Munich Regional Court (Germany) has further refined its framework for reviewing FRAND defences. Building on existing case law, the Chamber has developed a more structured and evidence-oriented, multi-stage analytical approach that warrants close attention by Chinese companies doing business overseas and IP practitioners.

This article addresses, in a Q&A format, the nine most practically relevant aspects of the Chamber's FRAND framework.

1. How does the 7th Chamber's framework relate to Huawei v. ZTE, and what is the real novelty?

The new framework does not deviate from established rules; rather, it concretises Huawei v. ZTE through a staged review process (external willingness → substantive review of the FRAND offer → internal willingness).

2. What does "external willingness" mean in practice?

It requires the implementer to: show no obvious delaying tactics, pay the undisputed amount (which may be treated as a non-refundable advance payment), and provide additional security if necessary. Only when these conditions are met will the court examine the SEP holder's offer.

3. How is "internal willingness" determined?

An implementer can demonstrate internal willingness by accepting an offer that falls within the FRAND licensing range. The SEP holder is generally only required to put forward an offer that falls within the FRAND range, and is not required to offer a licence at the very bottom of that range.

4. Does the review of a FRAND offer amount to judicial pricing?

In principle, the court does not engage in judicial pricing. However, in the ZTE v. Samsung case, the Chamber did determine a specific FRAND rate (which was largely consistent with the rate determined by the Chongqing No. 1 Intermediate People's Court), though that rate is not binding.

5.Which licence agreements are considered comparable?

Key criteria include the scope of the licence, commercial scale, and product comparability. The Chamber is cautious with respect to multi-standard bundled licences, and takes the view that SEP holders are not bound by their earlier "trial-and-error" licensing practices.

6. To what extent must licence agreements be disclosed?

For one-time paid-up licences, the total amount, the term of the licence, and the quantitative data underlying the calculation must be disclosed. The Chamber allows comparable agreements to be disclosed under flexible confidentiality arrangements.

7. How can a FRAND range be calculated based on comparable licence agreements?

A "3x rule" may be used (upper bound of three times the lowest comparable rate), or a range may be constructed by applying a 50% margin above and below a judicially determined median.

8. Does the 7th Chamber endorse the top-down approach?

Yes. The Chamber treats the top-down analysis as an auxiliary tool or cross-check for determining a FRAND rate, particularly useful when comparable agreements are lacking.

9. What are the conceptual differences between the Munich 7th Chamber and the UK courts?

UK courts treat FRAND as a contractual obligation and are inclined to determine a global FRAND rate; the Munich court, by contrast, approaches FRAND from an antitrust defence perspective, focusing on a FRAND range rather than a single global rate as the core remedy.

Through this series of judgments, the 7th Civil Chamber of the Munich Regional Court has significantly enhanced the predictability and operability of FRAND review, while maintaining the traditional German framework for FRAND defences. For Chinese companies facing SEP infringement risks in Germany, understanding and making good use of this "new" framework will help better protect their rights and interests during negotiations and litigation.

For further in-depth reading, please refer to the original English text as follows: 

Authors：EIP Patent Litigation Team Dr. Sebastian Fuchs, Dimitri Kosenko