As Taiwanese manufacturers rely strongly upon licensed technologies to compete in world markets, Taiwan’s Fair Trade Commission (the “FTC”) issued its Guidelines for Technology Licensing Arrangements on January 20, 2001, which were last amended on March 12, 2013 (the “Licensing Guidelines”) to provide a clear roadmap for the licensing of technology. The following snapshot of the Licensing Guidelines should assist companies to understand the antitrust risks inherent in technology licensing.

General Principles -

Technology licensing arrangements raise a few antitrust concerns. Companies in vertical or horizontal competition may engage in concerted actions that reduce competition. Unfair trade practices may impose restraints on trade to ensure profitability. Monopoly power may be abused to exclude competition or to achieve a lopsided advantage through technology licensing.