HEI Research in the Three Countries and EU Competition Law

The analysis of the different systems has been offered in order to better assess the relevance of EU competition law for research in HEIs in the three countries under investigation. The interim conclusions allow the following provisional assessment, which will form the starting point for the qualitative empirical study conducted in Chap. 5. As stated in more detail in Chap. 3, EU competition law only applies to ‘undertakings’ a notion that has been defined as ‘every entity engaged in an economic activity, regardless of the legal status of the entity and the way in which it is financed’.[1] To examine whether or not the research activities of HEIs are within the scope of application of EU competition law, an assessment of whether HEIs qualify as undertakings for (parts of) their activities thus needs to be made. This seems unlikely when it comes to research financed through public generic funding. According to the Research Framework,[2] ‘independent R&D for more knowledge and better understanding’ is a non-economic activity. Under generically funded research, the researchers are free to decide what they research and there is not generally any requirement that it has any practical uses or immediate impacts. Even in England where generic funding does dependent on, amongst other factors, impact, the researcher is still free to decide the directions of research and the impact does not have to be immediate or economically relevant.[3] A service is not defined, but instead it is generally assessed if the HEI in question generates impact at all. It is, therefore, hard to imagine how to conduct such research under market conditions. Instead it can be assumed that the noneconomic research definition of the Research Framework is being fulfilled here.

Research financed through competitive public, international and third sector funding, on the other hand, may have to be regarded in a differentiated way. If such funding is provided merely on academic merit and researchers can decide freely about the directions of research as in German DFG funding and under the Dutch Vernieuwingsimpuls scheme, the assessment would probably have to be the same as with public generic funding. Even if the calls broadly pre-define a topic area, this is still unlikely to amount to an activity that could be conducted under market conditions. However, the more pre-set the conditions, the more practical the research and the more identifiable potential users become, the more it is possible to argue that this could be conducted by commercial entities in a market. Actual contract research for these funders, in particular, would clearly be an economic activity.

As regards collaboration with the private sector, this can more easily come into the ambit of competition law. The fact that the private sector is interested in the research area in the first place already indicates a certain economic relevance. Nevertheless, collaborative forms differ. Contract research, consultancy[4] and the renting out of infrastructure are activities that could and partly are taking place on a market where competitors operate. IPR exploitation is, according to the Research Framework, a non-economic activity if the exploitation takes place internally and all income is reinvested into the non-economic research areas. It has been argued above[5] that, in addition, the Commission’s assessment in the Issue Paper[6] that to be non-economic knowledge transfer should also be non-exclusive and have arisen in an area of non-economic research should be the guiding principle for assessing the economic nature of IPR exploitation. In any case, if external investors are brought on-board as happens in England, IPR exploitation is to be considered as an economic activity. In clusters/science parks, the individual undertakings remain separated and this collaborative form would, therefore, probably not constitute an economic activity as such, rather it provides a geographical location for undertakings. Start-ups, spin-offs and German An- Institute are separate entities despite HEIs holding shares in them or being affiliated with them. The determination of whether any interaction is an economic activity for the HEI would probably depend on the activities these entities conduct, perhaps together with the HEI and the exact ties of ownership.

The determination might be more complicated when it comes to the more blurred forms of collaboration such as research co-operations, longer term PPPs, common centres, staff exchanges or research clubs/networks. It would also here depend on the question whether, in the individual case, the research is independent and ‘for more knowledge and better understanding’ or if particular pieces of research are in fact a research service conducted for another party. Private funding for a chair, lectureship or PhD which, aside from a pre-set subject area, does not have any conditions attached to it as well as purely charitable private sector donations are likely to be considered as non-economic activities. If the conditions are too defined and the funded researcher is essentially conducting a research service for another party which could take place on a market, the activity might well be economic in nature. These cases, therefore, often need to be assessed on an activity by activity basis.

  • [1] C-41/90 Hofner (Judgment of 23 April 1991, EU:C:1991:161) para 21. On the notion seeChap. 3 Sect. 3.2.1 above.
  • [2] Research Framework (n 162) Sect. 3.1.1.
  • [3] Indeed, the recent Stern Review suggested broadening the notion of impact under the REF(Stern 2016, p. 34).
  • [4] On a discussion of the ambivalence of certain forms of knowledge exchange includingconsultancy in the new Research Framework see Chap. 3 Sects. and above.
  • [5] Ibid.
  • [6] European Commission 2012.
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