The updated Technology Transfer Block Exemptions: modernisation, not overhaul

On 1 May 2026, the new EU Technology Transfer Block Exemption (TTBER) and its UK equivalent - the Technology Transfer Block Exemption Order (TTBEO) - entered into force. The block exemptions (and corresponding guidance) allow potential licensees and licensors to determine the compatibility of their technology licensing arrangements with EU/UK competition law, exempting agreements that meet certain conditions.

The new TTBER replaces the 2014 version, and follows several years of Commission review of the previous TTBER, including an open public consultation and expert study. 

From a UK perspective, the TTBEO is the first IP-related block exemption implemented by the UK following Brexit - the previous regulation was assimilated into UK law following the UK’s withdrawal from the EU.

Both the TTBER and TTBEO are accompanied by guidance documents explaining how they should be applied, as well as addressing commonly encountered competition issues in technology licence agreements. For now, however, the UK guidance remains in draft form.

We consider below some of the main changes to the TTBER, and highlight some of the key differences between the new UK and EU regimes.

Key changes 

Scope 

The scope of the TTBER remains unchanged, focusing on the transfer of “technology rights” - including patents, utility models, design rights, and software copyrights. 

For the first time, however, the new TTBER guidelines address data licensing, clarifying that the block exemption will apply directly to data licensing only where the licensed data constitutes “know-how” or some other technology right expressly covered by the TTBER. That said, where a licence concerns the production of goods or services and covers a database protected by copyright or the database sui generis right, the Commission will generally apply the principles of the TTBER and the accompanying guidelines. 

In contrast, the TTBEO contains some notable differences to the TTBER:

• utility models are excluded (given they are not recognised under UK IP law); and
• copyright in databases and database rights are explicitly included, providing a more robust safe harbour for these rights than under the TTBER. 

Market share thresholds

Under the TTBER, technology transfer agreements can only benefit from the block exemption if the parties’ combined market shares on the relevant markets do not exceed 20% (for agreements between competitors) or 30% (for agreements between non-competitors).

One significant change from the previous TTBER is that, if the preceding calendar year is not representative of the parties’ market positions, shares should be calculated as an average over the three preceding calendar years. This is likely to reflect the fact that in technology markets, market shares can fluctuate significantly year-on-year.

Additionally, the grace period for which the block exemption continues to apply after the parties first exceed the threshold has been increased, from two to three consecutive calendar years. This harmonises the TTBER with the Vertical Block Exemption Regulation (VBER) grace period, and again is likely in recognition of the fact that, in dynamic markets, shares can increase for one or two years without necessarily indicating a long-term increase and/or consolidation of a market position.

The TTBEO mirrors the above changes. However, the TTBEO includes an additional threshold that recognises that reliable market share data may not always be available. This alternative threshold is met if there are at least three independently controlled technology rights that compete (actually or potentially) with the licensed technology. The TTBEO guidance makes clear that when applying this alternative test, only technology rights that exert genuine competitive pressure (i.e. because they are substitutable) are to be taken into account.

The TTBER has no such alternative threshold, but the TT guidelines note that Article 101 of the Treaty on the Functioning of the EU (TFEU) is “unlikely” to be infringed where there are four or more independent competing technologies - a slightly less generous and concrete safe harbour than under the TTBEO.

Definitions

The updated TTBER now includes the following definitions of “active” and “passive” sales, which apply to sales restrictions between a licensor and licensee.

• Active sales: actively targeting customers by visits, letters, emails, calls, targeted advertising (print, digital, online media, price comparison services, search engine advertising), operating a website with a territory-specific top-level domain, or offering languages commonly used in particular territories.
• Passive sales: sales in response to unsolicited requests from individual customers, including delivery of goods/services, without actively targeting the customer, group, or territory; and participating in public procurement or responding to private invitations to tender.

The old TTBER did not include definitions of active or passive sales – the old TTBER guidelines simply stated that those terms should be interpreted in line with the definition and interpretation of those terms under the VBER and vertical restraints guidelines. By including definitions of these terms in the updated TTBER (which align with the VBER), that approach has been codified to provide greater legal certainty and make the new regulation more user-friendly.

The UK TTBEO adopts the same approach, but incorporates slightly more detailed definitions of both passive and active sales. It should be noted, however, that in the TTBEO, responding to private invitations to tender does not fall within the definition of passive selling.

Scrutiny and withdrawal of exemption from certain agreements 

The Commission may withdraw the benefit of the TTBER where the relevant agreement has effects that are incompatible with Article 101(3) TFEU. Under the previous TTBER, this included situations where access of other technologies or potential licensees to the market is restricted. The updated TTBER guidelines provide three additional examples of when the benefit of the TTBER will be withdrawn:

• competition between licensors is restricted - due to the imposition by a significant number of competing licensors of requirements for their licensees to extend to them more favourable conditions agreed with other licensors (i.e. “most favoured nation” clauses);
• customer access to the contract products is unduly limited - as a result of restrictions on the ability of the licensor or licensees to make passive sales to an exclusive territory or exclusive customer group reserved for the licensor or a licensee; or
• royalties in a relevant technology market are set at a supra-competitive level - as a result of the cumulative effect of similar cross-licensing agreements between competing undertakings.

The draft TTBEO guidance mirrors the above changes, but the test for withdrawal is arguably a little looser – simply that the CMA “considers that a particular technology transfer agreement is not exempt from the Chapter I prohibition… of the Competition Act 1998”.

Moreover, under the TTBEO the CMA has special rights to require the provision of information on agreements that are purported to benefit from the block exemption. A party to such an agreement must provide to the CMA such information in connection with the agreement as the CMA may request by notice in writing. Such requests for information must be complied with within ten working days from the relevant day. This is absent from the TTBER or corresponding guidelines.

Licensing negotiation groups 

One interesting new issue covered in the TTBER guidelines is the interaction between licensing negotiation groups (LNGs) and Article 101(1) TFEU. LNGs - where multiple licensees (e.g. manufacturers implementing a technical standard) seek to negotiate licenses collectively with standard essential patent holders or pools - are most likely to be encountered in standard-heavy industries such as the automotive and telecoms sectors. The guidelines do not set out a (soft) safe harbour for LNGs, but instead advise parties on how to avoid LNGs being characterised as unlawful buyer cartels (principally by ensuring they operate transparently) and/or leading to downstream seller cartels (by ensuring their purpose is clearly defined and limited to the negotiation of terms with technology holders).

This addition to the guidelines has likely been inspired by recent events, including a comfort letter issued by the European Commission concluding that the Automotive Licensing Negotiation Group would not raise concerns under Article 101(1) if certain conditions were met. 

The draft TTBEO guidance does not include any guidance on LNGs, and in fact the CMA stated in the accompanying consultation document that it does not consider it appropriate to include specific guidance on LNGs. This is on the basis that LNGs have emerged as an issue relatively recently, the CMA is not aware of any LNGs operating in the UK, and the CMA has no institutional experience in assessing LNG arrangements. The consultation document states that the CMA will assess any future LNGs on a case-by-case basis.

Technology pools

Technology pools are arrangements whereby two or more parties assemble a package of technology rights, which are licensed to contributors to the pool and/or to third parties. Since such pools create efficiencies where a technology implementer must obtain licences covering a number of different SEPs, a soft safe harbour is available in the UK and EU guidance where certain cumulative conditions are met (including safeguards to ensure that only essential and complementary technologies are pooled; technologies licensed into the pool are licensed on a non-exclusive basis; and the pool is open to all interested technology rightsholders). 

Both the 2026 TTBER guidelines and draft TTBEO guidance increase the number of conditions from seven to eight, adding a condition that there must be effective disclosure of the technology rights available in the pool to licensees. Both guidance documents expand upon certain other conditions, including suggesting that failing to put safeguards in place to avoid charging licensees twice for access to the same technology right is not consistent with licence terms being fair, reasonable and non-discriminatory, and adding an additional effective disclosure obligation as to the methodology used to conduct essentiality assessments.

The CMA noted in its consultation document that, despite receiving mixed feedback from stakeholders on some of the additional disclosure obligations, it considers that effective transparency can assist existing and potential licensees in assessing the scope and value of the technology made available through a technology pool. 

Conclusion 

The revised TTBER does not represent a material departure from the previous EU regime. And rather than creating a bespoke UK regime, the TTBEO remains closely aligned to the new EU regulation. Both build and expand upon the previous regulation/guidelines to modernise the regime in areas that are increasingly central to technology licensing, in particular data and standard-essential technologies (access to which are often essential for interoperability). 

For businesses operating across both the EU and the UK, such broad alignment is likely to be welcomed. Businesses should nevertheless review existing and future technology agreements carefully, particularly where they involve data licensing, territorial or customer restrictions, to ensure they fall within the scope of the TTBER and/or TTBEO.