We need judicial clarity on patent protections clashing with principles of fair competition

However, this monopoly is not absolute; competition law plays a vital role in ensuring that these rights are not exploited to the detriment of markets or consumers. Thus, by holding that the Competition Commission of India (CCI) cannot exercise jurisdiction over patent-related matters—or, specifically, by refusing to overrule a high court order saying so—the apex court may have effectively opened the door to potential anti-competitive agreements and abusive practices by patent holders.

The Ericsson vs. CCI case arose when the competition watchdog investigated the company for abusing its dominance in the business of licensing Standard Essential Patents (SEPs) by charging unfairly high royalties on technologies such as 4G, 5G and Wi-Fi. Ericsson challenged the probe at the Delhi high court, contending that only the Patents Act had jurisdiction over such disputes.

This was not the first time that fault lines between India’s competition law and IP law had surfaced. The Competition Act exempts IPRs, but with a condition: IPR restrictions must be both “reasonable" and necessary to protect this right. Courts have repeatedly acknowledged that the CCI can examine IPR-linked conduct under the competition law, as stated in Aamir Khan Productions Pvt Ltd vs. The Director-General.

Yet, the Delhi high court held that the CCI could not step into patent issues, reasoning that the Patents Act, being a special statute enacted later, must prevail. This was neither comprehensive nor convincing. The Competition law is also a special statute, designed to tackle anti-competitive conduct.

Also, the principle of “special law prevails over general law" is not absolute. Even if the high court’s ruling missed this nuance, it was squarely the responsibility of the Supreme Court to rectify that flawed reasoning and provide clarity. Instead, it dismissed the case, with its decision seemingly shaped by the fact that the parties had already reached a settlement. This is patently problematic.

The issue at stake was not a matter of private rights (in personam), but of public rights (in rem) that affect markets, consumers and the broader economy. As Avantika Kakkar, partner and head of competition law at Cyril Amarchand Mangaldas, aptly put it: “A private settlement between two parties can’t fix a market-wide problem."

Globally, mature jurisdictions such as the EU, US and China recognize that competition law authorities must have jurisdiction in matters where intellectual property overlaps with market dynamics.

In the landmark Huawei vs. ZTE case, the Court of Justice of the EU went so far as to establish a structured negotiation framework for SEP licensing to ensure fair, reasonable and non-discriminatory terms. Building on this, the European Commission in 2017 issued policy guidelines to strengthen oversight of SEP licensing, explicitly acknowledging the risks of unchecked dominance by patent holders.

Such international jurisprudence could have been taken into account. At the very least, the court could have laid down principles for concurrent jurisdiction, allowing the CCI to oversee anti-competitive conduct while leaving core patent validity and infringement issues to India’s patent authorities.

The status quo that prevails is flawed. Both the Competition Act and Patents Act are special statutes, but they serve different purposes. The Patents Act protects innovation and confers rights on patentees, while the Competition Act exists to prevent distortion of markets and abuse of dominance. A CCI stripped of jurisdiction over patent cases deals a blow to the statutory framework designed to deal with anti-competitive behaviour—remedies that the Patents Act simply does not provide.

A more balanced course was possible. The court could have carved out finely-tailored exemptions to safeguard the legitimate rights of patentees, while preserving the CCI’s role in scrutinizing exploitative licensing conduct. That would have ensured oversight without eroding patent rights. Instead, by denying competition law any oversight, the court’s position may effectively have handed patentees a blank cheque.

In SEP-heavy markets such as telecommunications, this can stifle innovation, inflate costs and choke fair market access. The chilling effect would not just be felt by businesses, but also by consumers, who ultimately bear the costs of distorted competition.

For India’s SEP-dependent digital economy, a CCI deprived of sufficient jurisdiction could prove especially damaging. It is likely to leave India trailing global standards, exposing markets, innovators and consumers to systemic harm. This case is a reminder that judicial reform is not a luxury, but an imperative. Indian courts must evolve frameworks that balance competing statutes instead of evading them. Without such reforms, the judiciary risks becoming a spectator to market distortions it was meant to guard against.

Vidhi Maharishi of CUTS contributed to this article.

The author are, respectively, vice president of Pune International Centre and secretary general of CUTS International.