The European Union (EU) filed a case against China with the World Trade Organisation (WTO) in an attempt to overturn a rule it claims prevents companies with mobile patents getting appropriate payment from manufacturers.

The grievance surrounds so-called anti-suit injunctions which have been in place since August 2020 and, the EU argues, prohibit patent holders from commencing court action outside of China against its manufacturers.

Large fines are in place for any action launched breaking the rule.

The EU claims the injunctions restrict the ability of owners of key technologies including those related to 3G, 4G and 5G from getting appropriate payment from companies, citing mobile phone manufacturers in the action.

It believes the policy is being used by Chinese companies to “benefit from cheaper or even free access to European technology”.

European Commission EVP and commissioner for trade Valdis Dombrovskis added: “We must protect the EU’s vibrant high-tech industry, an engine for innovation that ensures our leading role in developing future innovative technologies. EU companies have a right to seek justice on fair terms when their technology is used illegally.”

The case is the first step of dispute settlement proceedings with the WTO. After being filed, the parties have 60 days to try and resolve the matter. Should talks fail, the EU can request an arbitration panel be appointed.