Yao Jianjun: Judicial Pricing Rules for Standard Essential Patent Royalties Across Jurisdictions

WISECODE Take

I observe that many business owners mistakenly believe there is a uniform standard for patent licensing fees, but the concurrent rulings by Chinese and UK courts on the same dispute shatter this illusion. The essence of this case is that different courts will yield vastly different valuations based on their respective logic. On May 1, 2026, the Chongqing First Intermediate People's Court and the UK High Court issued judgments on the patent dispute between ZTE and Samsung on the same day. The Chongqing court found ZTE's six-year, $731 million proposal reasonable, while the UK court ruled a five-year net payment of $392 million, resulting in a nearly two-fold price difference. This showdown does not affect Taiwanese SMEs uninvolved in communication standards. However, hardware manufacturers expanding overseas must beware of competitors demanding high royalties using the comparable agreement method. Chi-Dian's patent portfolio health check service can help enterprises clarify risks before going abroad. To cope with judicial fragmentation, enterprises have two action paths. First, when signing international licensing agreements, they should clearly stipulate favorable jurisdiction courts in the contract. Second, a patent circumvention design mechanism should be established at the early stage of R&D. This is like arbitrage in multiple financial exchanges; mastering the pricing preferences of different courts is the key to avoiding overseas legal risks.