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Politics Home | What is the issue uniting innovative British manufacturers, major European industrials and global technology companies?
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Alexander Prenter, Policy Director
| Fair Standards Alliance
The ability of businesses in the UK to use common industry standards is increasingly constrained by the lack of a sufficiently clear and balanced legal framework. This situation harms the UK’s competitiveness and economic growth
Product innovators such as Tunstall Healthcare, Nyobolt, BMW Mini, Thales, Google, Amazon, Toyota, and many others, who are significant investors and employers in the UK, are increasingly concerned about a complex and untransparent technology licensing system.
That system is the licensing of Standard Essential Patents (SEPs). SEPs cover technologies that are voluntarily contributed to standards such as 5G, wi-fi, and video compression for streaming, with a binding promise to be licensed on fair terms. While smartphones and computers have long supported these standards, the connectivity boom means that these standardised technologies now reach into key British growth sectors such as automotive, energy, and medical devices. However, the current situation acts as a brake on British ambition.
The problem lies in how these technologies are licensed. Royalty demands are often disproportionate to the technology’s underlying value and are made under the threat of market exclusion through court-ordered injunctions. The Intellectual Property Office has identified serious concerns in this area, noting evidence that licensing demands have exceeded court adjudicated rates by up to 500 times.1 UK courts, too, have repeatedly found that SEP holders demand royalties far exceeding a fair rate and rely on the threat of injunctions in negotiations.2
These are not abstract concerns, but direct costs borne by innovative companies operating in the UK. Smaller companies are often hit hardest. The government’s Telecoms Supply Chain Advisory Council noted SEPs are “very highly concentrated among a small number of companies, none of which are UK-owned.” The result is a one-way outflow of value from the UK economy.
Yorkshire-based Tunstall Healthcare provides connected devices that enable elderly and vulnerable people to live independently at home. Its wearable alarms and remote monitoring systems are used by local authorities and NHS trusts to reduce hospital admissions and improve care.
These devices depend on standardised connectivity technology like 4G and wi-fi. Hundreds of thousands of patents are alleged to be essential to just these two standards alone, meaning companies like Tunstall must negotiate licences with multiple SEP holders, often through opaque and complex processes. Despite facing unfair demands, the cost of being unable to sell products owing to a court-ordered injunction is greater. Challenging the demands is also costly; one recent litigation cost £31m. Even large companies will settle at excessive cost to avoid this outcome.
UK companies face millions of pounds in excessive fees, but the impact is not confined to balance sheets. For health-tech, higher licensing costs are passed down the supply chain – to the NHS, local authorities, and ultimately to taxpayers. Lost R&D and reduced product functionality harm businesses and customers alike. Other medium-sized businesses, such as Nyobolt – an innovative, Cambridge-based smart battery systems company – have also reported how SEP licensing uncertainty directly reduces investors’ willingness to provide growth capital.
This week, a large group of UK and global companies will gather in London for the Fair Standards Alliance’s General Meeting. Our message is clear: without reform to curb excessive demands, the current system will continue to stifle innovation, deter investment, and place innovative UK companies at a structural disadvantage.
We are calling on the government to legislate for this pro-growth measure in the next session. Find out more at www.fair-standards.org.
We are hosting a reception in Parliament, with many companies in attendance.
Please drop by from 3.30pm to 5.00pm in the Home Room on Tuesday 19 May, to hear these concerns first-hand.
References
- Intellectual Property Office, ‘Consultation on Standard Essential Patents’, 15.07.2025
- IAM, ‘Ask versus outcome: FRAND valuation, judicial analysis and the continuing gaps in SEP litigation’, 16.01.2026
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