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UK FRAND decisions: pushing the boundaries (and finding them?)

David Al-Khalili
David Al-Khalili
Partner, Patent Attorney

Standard essential patents (SEPs) protect technologies required to implement technical standards. To ensure access, SEP holders declare to the standards setting body that they will license on fair, reasonable and non-discriminatory (FRAND) terms. Determining those terms – often in global disputes – has become a central role of the UK courts following Unwired Planet v Huawei.

Recent decisions, as discussed in this article, demonstrate both the continued prominence of the UK as a FRAND forum and the emergence of important limits and procedural complexities. Together, they reflect an evolving, rather than settled, structure.

From rights to rates

The UK Supreme Court established in Unwired Planet v Huawei that UK courts can determine the terms of a global FRAND licence as a consequence of enforcing UK SEPs.

In Optis v Apple, following findings of validity, essentiality and infringement of Optis’ SEP rights, the focus shifted to valuation. At first instance, the judge rejected both parties’ expert approaches and awarded a (relatively) modest lump sum license fee of $56.43 million plus interest to be paid by Apple to Optis. The Court of Appeal instead adopted a comparables-based methodology, identifying appropriate licences and adjusting them to derive a royalty of $0.15 per unit. This approach produced a substantially higher outcome of $502 million plus interest to be paid to Optis.

The issues raised in this case remain subject to potential clarification by the Supreme Court following appeal by Apple, with the hearing set to begin on 29 June 2026.

Comparables, corrections, and the “broad axe”

The High Court of England and Wales provided in Samsung v ZTE the most detailed recent treatment of valuation methodology. It reinforces that FRAND terms reflect the outcome of a hypothetical negotiation between a willing licensor and a willing licensee, operating free from both hold-up and hold-out (referred to collectively by Meade J as “non-FRAND”). In the judgment, reference was made to the Court of Appeal’s decision in Optis v Apple in this respect.

Comparables remain central, but are not determinative. Courts must identify genuinely comparable licences, exclude or adjust licences affected by non-FRAND factors, recognise that FRAND may lie within a range (the “broad axe”) rather than at a single point.

Importantly, the decision in Samsung v ZTE demonstrates that entire categories of comparables may be rejected where they are materially affected by non FRAND factors, for example, where agreements were concluded under commercial pressure or imbalance of the parties’ bargaining positions. In such cases, the court must proceed without relying on those comparables and instead determine FRAND terms using other evidence and methodologies

Bilateral FRAND meets platform reality

If earlier cases reflect expansion, the case between Tesla v InterDigital and Avanci at the Court of Appeal highlights limits; primarily procedural and structural rather than substantive. In this case, Tesla argued that Avanci (an independent licensing agent offering global licenses across a number of different platforms) was not offering its 5G platform license on FRAND terms. InterDigital, one of the SEP holders, was selected by Tesla as an anchor defendant.

The Court of Appeal’s majority proceeded on the basis that the European Telecommunications Standards Institute (ETSI) undertaking is directed to bilateral licensing and does not straightforwardly extend to collective platform licences such as Avanci’s; indeed, the court noted that Tesla had actually reached a bilateral agreement with one unnamed SEP holder and member of Avanci’s 5G platform. The decision strongly suggests that the FRAND obligation attaches to the conduct of individual SEP holders, rather than imposing a freestanding requirement that platform-level licences themselves be FRAND. At the same time, certain questions about how collective licensing structures interact with ETSI obligations (given that Avanci have made no FRAND commitments to ETSI) remain open.

The outcome instead turned on justiciability and claim structure. Tesla faced difficulties because it sought to determine the terms of a platform licence while suing only a single licensor, even though the licence involved multiple independent parties which were not before the court. In particular, the relief sought could not effectively be granted by the chosen defendant alone.

In April 2026, the Supreme Court heard Tesla’s appeal against the Court of Appeal decision. A decision is expected later in 2026.

License now, price later

Acer and Asus v Nokia introduces a further dimension; the interaction between interim licences, arbitration, and court supervision.

While Acer and Asus sought interim licenses, Nokia offered an “adjustable licence”, an immediately available interim licence whose financial terms would later be determined (and adjusted) by arbitration. The Court of Appeal held that such a licence is capable of acceptance and may, in principle, satisfy a SEP holder’s obligation to offer (F)RAND terms.

The key issue is not whether such licences exist, but whether their specific features – particularly the use of arbitration to determine final terms – are themselves consistent with RAND. This reflects a broader tension. Arbitration is consensual, yet implementers such as Acer and Asus may be required to accept such mechanisms or risk being treated as unwilling licensees.

The court clarified that arbitration can be used to determine RAND terms and does not displace the court’s supervisory role. However, it left open broader questions about when arbitration-based offers are consistent with FRAND, and how refusal of such offers should be assessed.

The global FRAND race

The UK’s role since Unwired Planet v Huawei in determining global (F)RAND rates is becoming increasingly contested.

In the dispute between Samsung and ZTE, parallel litigation is ongoing across multiple jurisdictions, including China, Germany, and the Unified Patent Court (UPC), in addition to the UK.

Chinese courts have demonstrated a willingness to set global FRAND rates, often adopting different methodologies to those used by the UK courts. This indeed was the case in the parallel actions between Samsung and ZTE before the Chinese and UK courts.

German courts remain influential in injunction practice, declining to set a global FRAND rate in Samsung v ZTE but granting ZTE an injunction against Samsung in Germany after finding that ZTE’s offer fell within “the FRAND corridor.”

The UPC, which offers attractive pan-European enforcement mechanisms, has yet to set global FRAND rates in any specific case. However, in the dispute between Samsung and ZTE, the UPC’s Mannheim Local Division issued a settlement proposal, indicating its willingness to become more involved in FRAND disputes going forward.

Against this backdrop, the UK’s strengths remain in its willingness to determine global licences and its detailed economic analysis in doing so. However, and with the caveat that the Supreme Court may settle on a different conclusion than that reached by the Court of Appeal, the restraint shown in Tesla v InterDigital and Avanci may ultimately limit the UK’s reach.

By declining to engage with platform licensing, the UK courts risk ceding ground to jurisdictions that are prepared to address the broader structure of SEP markets.

Where does FRAND go next?

UK FRAND jurisprudence is no longer simply expansionist. It reflects a developing balance between reach (global rate-setting), restraint (contractual and structural limits), and procedural complexity (forum choice, arbitration, and interim licensing).

At the same time, the UK’s claim to be the natural venue for global rate-setting is increasingly contested. Parallel proceedings and strategic forum choices now regularly engage China, Germany, and the UPC (which has yet to set global rates but is positioning itself to play a larger role).

The central question is shifting; from what FRAND terms are to how, and by whom, those terms are determined. That shift is likely to define the next phase of the UK FRAND landscape.

If you have any questions relating to SEPs, FRAND rates, or indeed any other IP matter, please contact the author or any member of the D Young & Co team.

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