Competition and IP law use different tools to pursue similar goals, particularly the promotion of innovation, economic growth and consumer welfare. In this regard, both policies are generally complementary and share synergies. However, tensions may arise in practice, as IP rights can confer or reinforce market power for their holders, potentially incentivising them to restrict access and hinder follow-on innovation.
As highlighted in the OECD Recommendation on Intellectual Property Rights and Competition, IP rights do not relieve their holders from compliance with competition law. Jurisdictions should therefore ensure the effective enforcement of competition law against anti-competitive IP-related business practices.
While competition authorities in some jurisdictions, such as the EU and the US, have long been active in addressing IP-related issues, in LAC this is more recent and has been concentrated in a few countries. Indeed, as illustrated in the examples mentioned in this note, some LAC competition authorities have enforced competition law to IP-related conduct. Antitrust actions have primarily focused on pharmaceutical patents, although other IP rights and sectors (such as copyrights in the audiovisual sector and patents in the ICT sector) have also come under competition scrutiny. Moreover, IP rights have played a central role in merger control, both in competition assessments and in the design of remedies, particularly in relation to trademarks.
Nevertheless, there is still room for other jurisdictions in the region to become more actively engaged in this area, despite the challenges posed by limited resources, other priorities, and the high level of specialised expertise required to assess such a complex and technical domain as IP law. The OECD Recommendation on Intellectual Property Rights and Competition can provide valuable guidance in this regard.
Furthermore, competition advocacy has proven to be an effective starting point for competition authorities to engage with IP-related issues. Advocacy can help shape a more pro-competitive IP legal framework and also pave the way for future enforcement actions. In fact, experiences from LAC jurisdictions, especially in the pharmaceutical sector, suggest that market studies and advocacy opinions submitted to IP agencies and legislators can play a key role in ensuring that IP regulation and its application are more aligned with competition principles.
In this context, co-operation between competition authorities and IP agencies can help integrate competition principles into IP law through advocacy efforts. This interaction is also essential when competition authorities investigate anti-competitive practices involving IP rights or review mergers in which IP rights are key assets. Moreover, co-operation between competition authorities is crucial, as IP rights often raise cross-border issues, which means that actions taken in one jurisdiction can have impact in others, requiring deeper co-ordination to avoid inconsistent outcomes.