Brussels, 09/02/2006 (Agence Europe) - After undertakings from the Dutch company, the European Commission has closed its investigation into the CD-R Disc Licensing Programmes administered by Philips in Europe. The investigation was launched in 2003 following a complaint (which was later retracted) by FIPCOM (the Federation of Interested Parties in fair Competition in the Optical Media sector). The complaint alleged that the terms and conditions of licensing of the CD-R technology violated competition rules on restrictive business practices and abuses of a dominant position. After examination, the Commission concluded that new licensing conditions offered by Philips were likely to bring about lower prices and more transparency for millions of consumers of recordable CDs. Philips has undertaken to discontinue the joint patent portfolio license programme in Europe, as well as those of Sony and Taiyo Yuden, with effect from 15 December 2005.
Philips has also offered an individual licence, the Philips Only Licence Agreement (PLA). The Commission decided that the revisions proposed by Philips were satisfactory. The most important changes in the new licensing agreement are: - making available on the Philips website summary reports of independent experts regarding those Philips patents that are essential to CD-R discs; - adding the explicit obligation for Philips to address technical problems associated with the management of the CD-R standard; - updating the CD-R standard to clarify that discs that do not use Philips' Multi Speed proprietary technology but alternative high speed recording technologies qualify as CD-R discs. The level of royalty also fell from 4.5 US cents to 2.5 US cents per disc, applied retroactively from 1 October 2005. The spokesman for Competition Commissioner Neelie Kroes welcomed the cooperation of Philips in this affair, the implications of which go beyond this agreement. “This clarifies the principles to be applied to all types of technological licences,” he said. Microsoft will be pleased.