Jörg Hoffmann

Contributions to Collected Editions, Commentaries, Handbooks and Encyclopaedias

The Role of Patent and Competition Law for Setting the Right Innovation Incentives for Europe’s Green Transition, in: Kreation Innovation Märkte - Creation Innovation Markets - Festschrift Reto M. Hilty, Springer, Berlin; Heidelberg 2024, 575 - 591. DOI

• Climate change poses a significant challenge to humanity. Spurring innovation in Europe is critical to the revitalisation of the European economy to create long-term sustainable prosperity. Providing incentives for innovation is one of the key priorities of the EU climate policy. Yet, it is crucial to determine, which legal measures provide the right incentives for developing technology that supports the transition to a low-carbon economy. Market-based incentive mechanisms enabled by patent law and maintained by competition law may foster innovation. Does this hold true for a required green and resilient transition of the European economy currently proclaimed under the EU climate policy? What are the drawbacks and the limits? What guideposts should the EU follow in order to meet its climate goals? This contribution sheds light on those questions. It argues that the reasons that hold back patent and competition laws’ potential in accelerating ‘green’ innovation are rather old wine in new bottles. The multiple crises do not require a specific redesign of patent and competition law and its dogmatic foundations in order to attain the EU climate goals. One needs action and must address the still existing legal issues. This contribution outlines specific recommendations in this regard.

Safeguarding Innovation through Data Governance Regulation – The Case of Digital Payment Services, in: Bundesministerium der Justiz und Verbraucherschutz, Max Planck Institute for Innovation and Competition, Max Planck Society (eds.), Data Access, Consumer Interests and Public Welfare, Nomos, Baden-Baden 2021, 343 - 400. DOI

• Also published as: Max Planck Institute for Innovation & Competition Research Paper No. 20-08

Intellectual Property Justification for Artificial Intelligence, in: Jyh-An Lee, Reto M. Hilty, Kung-Chung Liu (eds.), Artificial Intelligence and Intellectual Property, Oxford University Press, Oxford 2021, 50 - 74 (together with Reto M. Hilty, Stefan Scheuerer).

• Also published at Oxford Business Law Blog
• Also published as: Max Planck Institute for Innovation & Competition Research Paper No. 20-02

Journal Articles

Gatekeeper's Potential Privilege – the Need to Limit DMA Centralisation, Journal of Antitrust Enforcement 12, 1 (2024), 126 - 147 (together with Liza Herrmann, Lukas Kestler).

• The Digital Markets Act (DMA) aims at promoting contestable and fair markets for core platform services by setting out obligations for designated gatekeepers. As the DMA does not clearly define these two objectives, it comes into conflict with national legislation with overlapping objectives. This may include unfair competition laws and sector-specific regulation. Art. 1(5) DMA addresses this conflict by stipulating that Member States may not impose further obligations on gatekeepers for the purpose of ensuring contestable and fair markets. The effect this has is that national provisions vis-à-vis gatekeepers may not be applicable anymore and competences are centralised on the European level more broadly than potentially envisaged by the European legislature. This centralisation of competences runs the risk of inadvertently privileging gatekeepers by blocking national laws that are, however, still applicable to SMEs and other firms competing with gatekeepers. This paper suggests solutions to mitigate such risk.
• https://doi.org/10.1093/jaenfo/jnad040
• Also published as: Max Planck Institute for Innovation & Competition Research Paper No. 23-01

European Digital Platform Regulation Risks Undermining Itself with Over-Centralization, promarket.org 2023.

• https://www.promarket.org/2023/08/03/european-digital-platform-regulation-risks-undermining-itself-with-over-centralization/

Position Statement of the Max Planck Institute for Innovation and Competition of 2 May 2023 on the Implementation of the Digital Markets Act (DMA), GRUR Int 72, 9 (2023), 864 - 875 (together with Josef Drexl et al.). DOI

• Also published as: Max Planck Institute for Innovation & Competition Research Paper No. 23-11

Can Data Exploitation Be Properly Addressed by Competition Law? A Note of Caution, Concurrences 1 (2021), 75 - 82.

Demystifying the Role of Data Interoperability in the Access and Sharing Debate, Journal of Intellectual Property, Information Technology and Electronic Commerce Law 11, 3 (2020), 252 - 273 (together with Begoña Gonzalez Otero).

• In the current data access and sharing debate, data interoperability is widely proclaimed as being key for efficiently reaping the economic welfare enhancing effects of further data re-use. Although we agree, the role data interoperability plays for data access cannot be straightforwardly answered. First, data interoperability, as a technical mechanism, is an inherent part of some regulated data access rights. In these particular cases, data interoperability is the key enabler for efficient (re-)use of data. This example shows the relevance of addressing data interoperability within the corresponding obligation of the access right. It also reveals that interoperability becomes key from a market failure perspective if the failure stems from a lack of efficient data use or potential lock-ins. Another example where data interoperability goes hand in hand with data access regimes is digital platforms. However, digital markets have a tendency to “tipping”. Such a tendency is not natural but induced by individual practices, e.g., the obstruction to interoperability. To this end, subjecting dominant online platform companies to additional interoperability obligations and stricter monitoring could be an effective approach to control the abuse of market power. Likewise, the current EC’s ambition to pave the way towards European digital sovereignty highly depends on the design of a data interoperability policy within the context of access to and re-use of data. With this background in mind, our contribution answers the question of when and how data interoperability, as a precondition to data quality, should be addressed by the legislature. The paper brings together the technical, legal and economic aspects of data interoperability, conceptualizing it within the data sharing debate. It first elaborates on the notion of interoperability in the current data access and data governance frameworks. An analysis of the different technical interoperability facilitators and the existent legal framework that may hinder data interoperability in this context follows. The debate of APIs is still ongoing and brings on fundamental questions to the proper functioning of exclusive rights. To what extent could IPRs and trade secret protection encumber data interoperability? What would be the implications of granting IPR or trade secret protection for APIs, both in terms of raising incentives for their provision and with regard to effects on competition? The paper continues by considering the pros and cons of a more normative approach toward data interoperability. Data interoperability should be treated only as a means to an end and not as an end in itself. It should be taken as a part of the broader data sharing and access discussion, reflecting on the positive and adverse effects alike. To this end, a public law approach within the realm of a data governance solution seems more favorable. Such a governance solution could also entail a more consistent solution to conflicting IP, sui generis database and trade secrets protection in data, which is currently not thoroughly and clearly assessed either. These conflicts need a more holistic assessment of overlapping exclusive rights and their re-usability options.
• Also published as: Max Planck Institute for Innovation & Competition Research Paper No. 20-16
• Also published on Research Gate

Research Papers

Data Governance in Emerging Economies to Achieve the Sustainable Development Goals Senegal Country Report Based on the Workshop Shaping Data Sharing Policies in the Agricultural and the Financial Services Sector (Dakar, March 16-17, 2022) (Max Planck Institute for Innovation & Competition Research Paper, No. 24-05), 2024, 91 pp. (together with Mor Bakhoum et al.).

• The report presented here provides a comprehensive analysis of Senegal's current data governance laws and policies aimed at achieving the UN's Sustainable Development Goals (SDGs). It draws from insights gathered during a two-day multi-stakeholder workshop held in Dakar. This workshop was part of the broader international project titled 'Data Governance in Emerging Economies to Achieve the Sustainable Development Goals,' which underscores the growing global recognition of the crucial role of data governance in SDG attainment.
  Structured into four distinct parts, the report provides an exhaustive evaluation of Senegal's regulatory landscape concerning data access and sharing (Part I), laying the groundwork for a detailed examination of the alignment of these regulations with SDGs. It then focuses on the agricultural sector's data-sharing practices and their potential contributions to economic growth and sustainable development (Part II), followed by an exploration of the challenges and opportunities in data governance for financial services in the digital era (Part III). Part IV synthesizes the workshop's discussions, offering valuable insights, conclusions, and forward-looking recommendations.
  This scholarly endeavor contributes significantly to the ongoing discourse surrounding data governance and its pivotal role in realizing the SDGs. The nuanced analysis and insights presented herein serve as a valuable resource for policymakers, academics, and practitioners operating at the intersection of data governance, development, and sustainability. Moreover, the outlined recommendations and prospective research agenda provide a roadmap for our future endeavors aimed at advancing data governance in emerging economies, aligning with the vision of the UN AI Advisory Board to govern AI for humanity.
• Le présent rapport propose une analyse approfondie du cadre réglementaire relatif à la gouvernance des données au Sénégal dans l’optique d’atteindre les Objectifs de Développement Durable des Nations Unies (ODD). Il tire parti des informations et données recueillies lors d'un atelier multipartite de deux jours tenu à Dakar. Cet atelier s'inscrivait dans le cadre du projet international plus large intitulé "Gouvernance des données dans les économies émergentes pour atteindre les Objectifs de développement durable (ODD) ». Le projet met en exergue la reconnaissance croissante du rôle crucial de la gouvernance des données dans la réalisation des ODD à l'échelle mondiale.
  Structuré en quatre parties distinctes, le rapport offre une évaluation approfondie du cadre réglementaire du Sénégal en ce qui concerne l'accès et le partage des données (Partie I), posant ainsi les bases pour un examen détaillé de l'alignement des dispositions légales avec les ODD. Il se concentre ensuite sur les pratiques de partage de données dans le secteur agricole et leur contribution potentielle à la croissance économique et au développement durable (Partie II), suivi d'une exploration des défis et des opportunités de la gouvernance des données pour les services financiers à l'ère numérique (Partie III). La Partie IV synthétise les discussions de l'atelier, offrant des perspectives, des conclusions et des recommandations prospectives.
  Cette étude apporte une contribution significative au débat en cours sur la gouvernance des données et son rôle central dans la réalisation des ODD. L'analyse détaillée et les perspectives présentées ici sont une ressource pour les décideurs, les universitaires et les praticiens qui travaillent sur l'intersection entre la gouvernance des données, le développement et la durabilité. De plus, les recommandations formulées et le programme de recherche prospectif offrent une feuille de route pour les initiatives futures visant à faire progresser la gouvernance des données dans les économies émergentes, s'alignant ainsi sur la vision du Groupe consultatif sur l'IA des Nations unies pour une gouvernance de l’IA au service de l'humanité.
• Available at SSRN

Setting the Right Innovation Incentives for Europe’s Green Transition (Max Planck Institute for Innovation & Competition Research Paper, No. 23-13), 2023, 31 pp. DOI

• Climate change poses a significant challenge to humanity. Building cleantech innovation systems and spurring innovation in Europe is critical to the revitalisation of the European economy to create long-term sustainable prosperity. Providing incentives for innovation is one of the key priorities of the EU climate policy. Yet, it is crucial to determine, which legal measures provide the right incentives for developing climate change technology. Market-based incentive mechanisms enabled by patent law and maintained by competition law may foster innovation. Does this hold true for a required green transition of the European economy currently proclaimed under the EU climate policy? What are the drawbacks and the limits? What guideposts should the EU follow in order to meet its climate goals? This contribution sheds light on those questions. It argues that the reasons that hold back patent and competition laws’ potential in accelerating “green” innovation are rather old wine in new bottles. The multiple crises do not require a specific redesign of patent and competition law and its dogmatic foundations in order to attain the European climate goals. One needs action and must address the still existing legal issues. This contribution outlines specific recommendations in this regard.

Technical Aspects of Artificial Intelligence: An Understanding from an Intellectual Property Law Perspective (Max Planck Institute for Innovation & Competition Research Paper, No. 19-13), 2019, 15 pp. (together with Josef Drexl et al.).

• The present Q&A paper aims at providing an overview of artificial intelligence with a special focus on machine learning as a currently predominant subfield thereof. Machine learning-based applications have been discussed intensely in legal scholarship, including in the field of intellectual property law, while many technical aspects remain ambiguous and often cause confusion.
  This text was drafted by the Research Group on the Regulation of the Digital Economy of the Max Planck Institute for Innovation and Competition in the pursuit of understanding the fundamental characteristics of artificial intelligence, and machine learning in particular, that could potentially have an impact on intellectual property law. As a background paper, it provides the technological basis for the Group’s ongoing research relating thereto. The current version summarises insights gained from background literature research, interviews with practitioners and a workshop conducted in June 2019 in which experts in the field of artificial intelligence participated.
• Available at SSRN

EU-Merger Control in Big Data-Related Mergers (Max Planck Institute for Innovation & Competition Research Paper, No. 19-05), 2019, 74 pp. (together with Germán Oscar Johannsen).

• The main focus of the Commission’s last decade decisional practice in big data mergers has been on identifying possible harming effects of the control over exclusive information (absolute foreclosure scenario). Thereby it has centred its analysis on the assessment of the overall availability of data post-merger and thus mostly found no concerns due to the ubiquity and non-rivalrous nature of data. However these considerations were too short-sighted as additional competition concerns may arise when the accumulation of large piles of data from a huge multitude of sources by digital conglomerates leads to such an advantage that competitors will not be able to match anymore, increasing the likelihood of further anti-competitive strategies (relative foreclosure scenario). Accordingly, the paper firstly addresses the need for information centric reference points for the analysis of data induced significant impediments of competition (SIEC). It then analyses the approach taken by the Commission so far, identifies the shortcomings and establishes a theory of harm that takes the efficiency offense doctrine and the financial power and portfolio effect theories of harm as a reference point and relate it to a relative foreclosure strategy of the merged group that is specific to data induced SIEC. The distinction of these two foreclosure scenario levels serves as the basis for further discussion on adequate remedies to tackle the two types of data-induced harming effects. The paper then indulges into the intersection of competition law and data protection law and analyses the potential need for a distinction between personal and non-personal data due to the fact that data protection law might be considered a normative factual remedy that renders personal data specific competition concerns post-merger unnecessary. This is then followed by a parallel analysis related to ex-ante data access regimes being normative factual remedies, e.g. the access to account rule under the Payment Services Directive 2 (PSD2). It then stresses the need for considering formal elements such as conditional remedies that tackle potential issues of a lack of foreseeability due to high market dynamics before examining the efficiency and feasibility of a data sharing commitment for both absolute and relative foreclosure scenarios. As essential facility considerations cannot be analogously applied in relative foreclosure cases we take recourse to criteria that were established for measuring conglomerate power structures. Accordingly in relative foreclosure scenario cases we establish two requirements that need to be fulfilled by the undertaking seeking access to data in order to confine a potential erga omnes right and make data sharing legally obtainable.
• Available at SSRN

Digital Markets, Mobile Payments Systems and Development – Competition Policy Implications in Developing Countries in Light of the EU Experience (Max Planck Institute for Innovation & Competition Research Paper, No. 18-13), 2018, 43 pp. (together with Mor Bakhoum, Francisco Beneke).

• The digitization of economic activity has important socio-economic development implications and at the same time creates challenges for antitrust analysis. These implications and challenges have been met differently in jurisdictions around the world. In this paper we analyze the different experiences in the EU and developing countries, focusing on mobile payments. We find that this market exhibits special characteristics that need to be taken into account in the analysis of competition conditions. First, it is enabled by mobile telecommunications infrastructure and is offered by network operators, which causes competition in both markets to be closely linked. Second, there are factors, such as the lack of interoperability and geographical reach, that make network effects in this industry different from those present in other platforms. Third, since mobile payments in developing countries serve a niche—the population underserved by mainstream banking—the definition of the relevant market is not straightforward. We propose the criteria to be applied when making such definition. Finally, since mobile payments have associated financial services, there is an interaction between competition and financial stability that needs to be considered.
• Available at SSRN

Opinions

Position Statement of the Max Planck Institute for Innovation and Competition of 2 May 2023 on the Implementation of the Digital Markets Act (DMA), 2023, 33 pp. (together with Josef Drexl et al.).

• Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector (Digital Markets Act; DMA) entered into force on 1 November 2022 and applies from 2 May 2023. The DMA is a novel type of regulation laying down harmonised rules for core platform services provided or offered by gatekeepers to business users and end users established or located in the Union. It pursues the objective of achieving fairness and contestability in the digital sector across the Union where gatekeepers are present.
  In its position statement of 2 May 2023, the Institute acknowledges that uniform rules throughout the European Union and centralised enforcement are necessary to prevent internal market fragmentation and welcomes the first Commission Implementing Regulation for the DMA of 14 April 2023. However, it remains concerned by the DMA’s unique institutional design and its interaction with other laws as outlined under Articles 1(5), 1(6) and 1(7).
  In particular, the Institute raises awareness about the possible overly broad blocking effects of the DMA on national rules, which may have the unintended consequences of privileging gatekeepers by jeopardizing future national legislative initiatives. This ultimately obstructs the achievement of contestability and fairness in digital markets. A complementary application of the competition rules and effective enforcement of the DMA is, against this backdrop, crucial. Yet there is uncertainty over administrative enforcement mechanisms, and it is unclear what role private enforcement plays in the current legal design of the DMA. The position statement identifies and examines challenges in the implementation of the DMA, along with recommendations for overcoming them.
• Position_Statement_MPI_DMA.pdf
• Also published as: Max Planck Institute for Innovation & Competition Research Paper No. 23-11
• Also published in: GRUR International, Volume 72, Issue 9, September 2023, Pages 864–875

Position Statement of the Max Planck Institute for Innovation and Competition of 25 May 2022 on the Commission's Proposal of 23 February 2022 for a Regulation on Harmonised Rules on Fair Access to and Use of Data (Data Act), 2022, 124 pp. (together with Josef Drexl et al.).

• On 23 February 2022, the European Commission issued a Proposal for a Regulation on harmonised rules on fair access to and use of data (Data Act). The overarching objective of the Proposal is to ‘ensure fairness in the digital environment, stimulate a competitive data market, open opportunities for data-driven innovation and make data available for all’. The Institute hereby presents its Position Statement that features a comprehensive analysis of whether and to what extent the proposed rules might reach the envisaged objectives. It comments on all parts of the Proposal, including the new IoT data access and use right. Finally, the Institute offers a set of recommendations as to how the proposed provisions should be amended in the legislative process to align them better with the objectives of the Data Act.
• Position_Statement_MPI_Data_Act_Formal__13.06.2022.pdf
• Also published as: Max Planck Institute for Innovation & Competition Research Paper No. 22-05

Artificial Intelligence and Intellectual Property Law - Position Statement of the Max Planck Institute for Innovation and Competition of 9 April 2021 on the Current Debate, 2021, 26 pp. (together with Josef Drexl et al.).

• This Position Statement presents a broad overview of issues arising at the intersection of AI and IP law based on the work of the Max Planck Institute for Innovation and Competition research group on Regulation of the Digital Economy. While the analysis is approached mainly from a perspective de lege lata, it also identifies questions which require further reflection de lege ferenda supported by in-depth interdisciplinary research. The scope is confined to substantive European IP law, in particular, as regards copyright, patents, designs, databases and trade secrets. Specific AI-related issues are mapped out around the core questions of IP law, namely, the eligibility for protection under the respective IP regimes, allocation of rights and the scope of protection. The structure of the analysis reflects three key components of AI: inputs required for the development of AI systems, AI as a process and the output of AI applications. Overall, it is emphasised that, while recent legal and policy discussions have mostly focused on AI-aided and AI-generated output, a more holistic view that accounts for the role of IP law across the AI innovation cycle is indispensable.
• MPI_PositionPaper__SSRN_21-10.pdf
• Also published as Max Planck Institute for Innovation & Competition Research Paper No. 21-10

Comments of the Max Planck Institute for Innovation and Competition of 11 February 2020 on the Draft Issues Paper of the World Intellectual Property Organization on Intellectual Property Policy and Artificial Intelligence, 2020, 9 pp. (together with Josef Drexl et al.).

• WIPO AI Draft Issue Paper_Comments_Max Planck.pdf

Further Publications, Press Articles, Interviews

How to Implement the DMA in Order to Attain Its Goals of Contestability and Fair Digital Markets for Core Platform Services, Oxford Business Law Blog 2023.

• https://blogs.law.ox.ac.uk/oblb/blog-post/2023/07/how-implement-dma-order-attain-its-goals-contestability-and-fair-digital

German Legislators Dismiss E-Money Concerns Over 4th AMLD - Interview, Payments Compliance, Compliance Online 2017 24.05.2017.