Autotech, Autonomous Driving and Connectivity – Some Competition Law Considerations

When autonomous driving becomes reality on our streets the smart and connected cars will permanently exchange data with other vehicles as well as with the surrounding infrastructure. The development of connectivity and the different steps of autonomy will face certain antitrust and competition law challenges. These cover questions of:

  • Competition in Innovation and R&D
  • Standardisation, compulsory licencing and FRAND
  • Access to data

Competition on Innovation

The future demands more innovation. New technologies have to be developed in order to overcome the traffic and pollution problems the world is increasingly facing. The possible solutions are new propulsion technologies (electrical, fuel cells, etc.) and new mobility concepts (like car sharing or ride hailing). Furthermore, autonomous driving and connectivity shall also enhance the safety of mobility. However, these innovations require a lot of investment and co-operation among the different stakeholders. Especially in cases where competitors work together in certain R&D projects, joint ventures, etc. competition problems could arise.

Standardisation, compulsory licensing and FRAND

The development of new technologies can result in industry standards. This is especially true with regard to interconnectivity and interoperability. Autonomous driving requires that smart cars scan and distinguish other cars (C2C), other vehicles (C2V) and the surrounding infrastructure (C2I). Vehicles have to communicate and perpetually exchange information with each other. This only works if they “speak the same language”.

Standards are quite often set by standard-setting organisations (SSOs) where competitors work together. This again can raise competition concerns, especially foreclosure concerns if the access to the standard is restricted. Standards can even create market power for those companies who own the IPR that is essential for the standard technology (“standard essential patents”, SEP). Therefore, the competition authorities already require an open and transparent process for the standard-setting itself. Furthermore, access to the standard (for example by granting licences) has to be provided on fair, reasonable and non-discriminatory (“FRAND”) terms. Furthermore, SSO participants are regularly requested to disclose their IPR in good faith prior to the standard-setting in order to avoid “patent ambushes”.

However, even in cases of a de facto standard the rights holders of SEPs can be obliged to grant licences on FRAND terms if a refusal to license is considered an abuse of a dominant position.

Access to Data

The new generations of cars provide huge volumes of data, whether from “internal” sources (like sensors, cameras, GPS, etc.) and “external” sources (from other vehicles, infrastructure, etc.). This will not only raise questions of data privacy and cybersecurity but also of competition law. This data can be used by OEMs for the improvement of vehicle performance or for predictive maintenance purposes.

At the same time the possession of such data can be a competitive advantage that finally could result in market power especially on downstream markets. Other stakeholders like independent spare parts suppliers and repairers, distributors, etc. may need access to certain data in order to provide their services. OEMs could, therefore, be requested by competition law to provide access to the data on a non-discriminatory basis in terms of pricing, quantity and kinds of data.

However, this shall only be the case if the access to the data is indispensable. It has to bear in mind that the collection and generation of data can also be the result of a competition on the merits. In such cases, a requirement to grant access to the data to third parties could also be negative for the investments in innovation and ultimately for consumer welfare.