Article 1

1.For the purposes of this Regulation, the following definitions shall apply:
(a) ‘agreement’ means an agreement, a decision of an association of undertakings or a concerted practice;
(b)  ‘technology rights’ means know-how and the following rights, or a combination thereof, including applications for or applications for registration of those rights:
(i) patents,
(ii) utility models,
(iii) design rights,
(iv) topographies of semiconductor products,
(v) supplementary protection certificates for medicinal products or other products for which such supplementary protection certificates may be obtained,
(vi) plant breeder’s certificates and
(vii) software copyrights;

(c) ‘technology transfer agreement’ means:
(i) a technology rights licensing agreement entered into between two undertakings for the purpose of the production of contract products by the licensee and/or its sub-contractor(s),
(ii) an assignment of technology rights between two undertakings for the purpose of the production of contract products where part of the risk associated with the exploitation of the technology remains with the assignor;

(d) ‘reciprocal agreement’ means a technology transfer agreement where two undertakings grant each other, in the same or separate contracts, a technology rights licence, and where those licences concern competing technologies or can be used for the production of competing products;
(e) ‘non-reciprocal agreement’ means a technology transfer agreement where one undertaking grants another undertaking a technology rights licence, or where two undertakings grant each other such a licence but where those licences do not concern competing technologies and cannot be used for the production of competing products;
(f) ‘product’ means goods or a service, including both intermediary goods and services and final goods and services;
(g) ‘contract product’ means a product produced, directly or indirectly, on the basis of the licensed technology rights;
(h) ‘intellectual property rights’ includes industrial property rights, in particular patents and trademarks, copyright and neighbouring rights;
(i) ‘know-how’ means a package of practical information, resulting from experience and testing, which is:
(i) secret, that is to say, not generally known or easily accessible,
(ii) substantial, that is to say, significant and useful for the production of the contract products, and
(iii) identified, that is to say, described in a sufficiently comprehensive manner so as to make it possible to verify that it fulfils the criteria of secrecy and substantiality;

(j) ‘relevant product market’ means the market for the contract products and their substitutes, that is to say all those products which are regarded as interchangeable or substitutable by the buyer, by reason of the products’ characteristics, their prices and their intended use;
(k) ‘relevant technology market’ means the market for the licensed technology rights and their substitutes, that is to say all those technology rights which are regarded as interchangeable or substitutable by the licensee, by reason of the technology rights’ characteristics, the royalties payable in respect of those rights and their intended use;
(l) ‘relevant geographic market’ means the area in which the undertakings concerned are involved in the supply of and demand for products or the licensing of technology rights, in which the conditions of competition are sufficiently homogeneous and which can be distinguished from neighbouring areas because the conditions of competition are appreciably different in those areas;
(m) ‘relevant market’ means the combination of the relevant product or technology market with the relevant geographic market;
(n) ‘competing undertakings’ means undertakings which compete on the relevant market, that is to say:
(i) competing undertakings on the relevant market where the technology rights are licensed, that is to say, undertakings which license out competing technology rights (actual competitors on the relevant market),
(ii) competing undertakings on the relevant market where the contract products are sold, that is to say, undertakings which, in the absence of the technology transfer agreement, would both be active on the relevant market(s) on which the contract products are sold (actual competitors on the relevant market) or which, in the absence of the technology transfer agreement, would, on realistic grounds and not just as a mere theroretical possibility, in response to a small and permanent increase in relative prices, be likely to undertake, within a short period of time, the necessary additional investments or other necessary switching costs to enter the relevant market(s) (potential competitors on the relevant market);

(o) ‘selective distribution system’ means a distribution system where the licensor undertakes to license the production of the contract products, either directly or indirectly, only to licensees selected on the basis of specified criteria and where those licensees undertake not to sell the contract products to unauthorised distributors within the territory reserved by the licensor to operate that system;
(p) ‘exclusive licence’ means a licence under which the licensor itself is not permitted to produce on the basis of the licensed technology rights and is not permitted to license the licensed technology rights to third parties, in general or for a particular use or in a particular territory;
(q) ‘exclusive territory’ means a given territory within which only one undertaking is allowed to produce the contract products, but where it is nevertheless possible to allow another licensee to produce the contract products within that territory only for a particular customer where the second licence was granted in order to create an alternative source of supply for that customer;
(r) ‘exclusive customer group’ means a group of customers to which only one party to the technology transfer agreement is allowed to actively sell the contract products produced with the licensed technology.
 

2. For the purposes of this Regulation, the terms ‘undertaking’, ‘licensor’ and ‘licensee’ shall include their respective connected undertakings.
‘Connected undertakings’ means:
(a) undertakings in which a party to the technology transfer agreement, directly or indirectly:
(i) has the power to exercise more than half the voting rights, or
(ii) has the power to appoint more than half the members of the supervisory board, board of management or bodies legally representing the undertaking, or
(iii) has the right to manage the undertaking’s affairs;

(b) undertakings which directly or indirectly have, over a party to the technology transfer agreement, the rights or powers listed in point (a);
(c) undertakings in which an undertaking referred to in point (b) has, directly or indirectly, the rights or powers listed in point (a);
(d) undertakings in which a party to the technology transfer agreement together with one or more of the undertakings referred to in points (a), (b) or (c), or in which two or more of the latter undertakings, jointly have the rights or powers listed in point (a);
(e) undertakings in which the rights or the powers listed in point (a) are jointly held by:
(i) parties to the technology transfer agreement or their respective connected undertakings referred to in points (a) to (d), or
(ii) one or more of the parties to the technology transfer agreement or one or more of their connected undertakings referred to in points (a) to (d) and one or more third parties.