Nokia and Samsung extended a patent licence agreement due to expire at the end of 2013 by five years. Starting from 1 January 2014, Nokia will receive additional compensation from Samsung for use of its patents.

Nokia said that the companies will “enter into binding arbitration to settle the amount of additional compensation”, which is expected to be concluded during 2015.

“This extension and agreement to arbitrate represent a hallmark of constructive resolution of licensing disputes, and are expected to save significant transaction costs for both parties,” said Paul Melin, Nokia’s chief intellectual property officer

The announcement did not say what patents the agreement covers, but Florian Mueller of FOSS Patents said it will cover “at the very least” Nokia’s cellular standard essential patents.

Mueller said most of Nokia’s existing licence agreements only cover standard essential patents, and the reference to additional compensation suggests this is the case in the extended agreement with Samsung. Non-standard essential patent agreements are usually worked out in a different way.

If this is the case, the two companies still need to come to an agreement on non-standard essential patents.

Samsung will want to avoid a similar situation to HTC which is being sued by Nokia in six countries for infringing on non-standard essential patents.

Nokia is aiming to make better use of its portfolio of technology patents, which it will retain after its handset business is sold to Microsoft in 2014. It plans to lease patents to the US company.

Along with Qualcomm and Ericsson, Nokia is one of the top patent holders in the mobile industry, having invested billions of Euros in research and development over several decades.

When announcing the Samsung deal, Nokia said it “sees further opportunity to create value by investing in innovation, and by actively managing its patent portfolio and licensing activities”.