Sent: 23 October 2015 5:07 PM
Dear Mr. Evans,
Reference is made to the public consultation on the proposed final undertakings in the CMA’s
investigation of the anticipated acquisition by Reckitt Benckiser Group PLC of the K-Y brand in the
UK.
In the name and on behalf of our client [], we would like to submit one observation regarding the
draft final undertakings for Reckitt Benckiser Group plc (RB) and RB (Brands) Limited.
Section 4.15 of the draft final undertakings for RB currently says:
“The Acquirers undertake to license to the Approved Licensee the right to use the K-Y formula in
perpetuity, if required by the Approved Licensee.”
This is in line with the CMA’s own final report on this case which found that the required licensing
remedy should include, inter alia, the right to use the K-Y formula in perpetuity (cf. CMA’s final report
of 12 August 2015, summary para. 24 (h); final report para. 12.33 (g)).
[] submits that the right to use the KY formula in perpetuity should also include a perpetual right to
the technical information and know-how relating to the manufacturing of such formulae.
Otherwise, such information and know-how would fall into the definition of Licensed Operations, which
would only survive for the Licensed Period under Section 4.6. It would be inconsistent to have the
license to the formula run in perpetuity, but have the license to the know-how (and patent rights, if
any) necessary to make such formula expire sooner. In other words: without the requisite technical
information, patent rights and know-how, the mere possession of the formula would be useless.
[] therefore suggests to extend Section 4.15 of the draft undertakings for RB as follows (additions
in capital letters):
“The Acquirers undertake to license to the Approved Licensee the right to use the K-Y formula AS
WELL AS TECHNICAL INFORMATION, PATENT RIGHTS AND KNOW-HOW RELATING TO THE
MANUFACTURING/USE OF THE K-Y FORMULA in perpetuity, if required by the Approved
Licensee.”
This is also in line with at least one of the European Commission precedents the CMA referred to in
its final report, i.e., Case No COMP/M.3149 – Procter & Gamble/Wella. The Schedule to the
Commitments accepted by the European Commission in this case lists under para. 1.(a) (iii) and (iv)
(page 39 of the decision) that all the know-how and all recipes necessary for the production of
licensed products are part of the Commitment package, but unlike the licenses themselves without
time limit.
Our client remains at your disposal, should you have any questions with regard to this submission.
Kind regards
[]