UPC CFI, LD Munich, 23 April 2026: “FRAND security” does not relieve the obligation to provide security for cost.
14-07-2026 Print this page
Panel review of order for security of costs dismissed. (Article 69 UPCA, Rule 158.1 RoP, Rule 333 RoP)
“FRAND security” does not relieve the Claimant of the obligation to provide security for cost.
A bank guarantee provided by a Defendant, as part of his objection of compulsory licence under competition law, as security for any potential licence payment obligations towards the Claimant and thus to avert an injunction claim asserted by the Claimant (“FRAND security”), does not, in principle, relieve the Claimant of the obligation to provide security for costs, even if the amount of the bank guarantee exceeds the amount of the security for costs.
Neither does the bank guarantee constitute a valuable asset of the Claimant to which the Defendant may have recourse for the recovery of its costs, nor does the provision of the bank guarantee allow the conclusion that the Defendant is obliged to pay licence fees to the Claimant against which he could set off a claim for recoverable costs.
After the Event insurance (ATE).
Taking out ATE insurance as such – even with an anti-avoidance endorsement – is not adequate to automatically remove an obligation to provide security once it has been ordered.
