The Intellectual Property Office (IPO) has published a consultation on proposals to reform the Standard Essential Patents (SEP) regime which governs technology which is essential to implementing a standard. 

SEPs are an integral part of modern life. As the consultation puts it, they “allow your smartphone to talk to your headphones, your car to connect to traffic systems, and hospitals to use the latest healthcare innovations. They make our modern, connected lives possible”. However, according to the consultation, there is growing concern that the existing SEP regime hinders innovation and investment, putting the development of emerging technologies such as AI and IoT products at risk.  

One area in particular that the consultation highlights is the problem of transparency, both in relation to pricing, and also as to whether patents are truly essential to a standard. On the question of pricing, licence rates for SEPs are currently negotiated in private between businesses, and the pricing information is protected by non-disclosure agreements. This means that licensees are unable to know if a rate offered by an SEP holder is fair or competitive. In turn, that makes planning for licensees more difficult, not to mention the fact that they might overpay for licences. As for transparency with regards to whether an SEP is essential, the consultation suggests that only 25-40% of all declared SEPs are truly essential to a given standard. 

To address this information asymmetry, two potential measures are proposed. First, the consultation suggests the introduction of a new ‘Rate Determination Track’ (RDT) within the Intellectual Property Enterprise Court which would focus on the narrow issue of rate setting. According to the consultation, the RDT would use “pre-litigation protocols, simplified procedures, specialist, and streamlined case management” to provide a binding rate determination on request of either the licensor or licensee. Second, the Government is considering introducing an additional search function to the One IPO Search service so that users can search for patents that relate to technical standards, whilst also mandating that patent owners disclose standard related patent information. 

Finally, the consultation addresses ways to improve how disputes are resolved, noting that “there are concerns that inefficient or lengthy dispute resolution may have a detrimental impact on business and innovation”. Proposals include introducing a new Pre-Action Protocol for SEP disputes and the expansion of existing mediation services. 

The consultation closes on 7 October 2025, and can be found here.