(Yicai) Dec. 14 -- A court in China has become the first in the world to specify a limit on the royalty rate that phone makers pay to use patented fifth-generation wireless technologies.

The court in Chongqing set the fair, reasonable, and non-discriminatory royalty rate for essential 5G patents in China at between 4.341 percent and 5.273 percent, according to the first-instance ruling it made public today following a lawsuit that Oppo Mobile Telecommunications brought against Finnish telecoms giant Nokia.

Nokia has been charging 6.82 percent. 

The court’s ruling means that for a 5G handset priced at USD200, the manufacturer will not have to pay more than USD10.55 in 5G royalties, a cap that should lift their profits and accelerate the development of the Internet of Things.

Oppo will comply with the ruling and hopes to actively resolve the licensing fee dispute with Nokia, the Dongguan-based firm said, adding that it had received prior notice last week.

“We note that its impact is limited to China’s jurisdiction and thus represents only one view,” Nokia said in response to the ruling.

“Courts outside of China have confirmed that Oppo is violating its commitments as a user of Nokia technology in open standards.” it added. “Courts outside of China have also confirmed that Nokia has made fair offers to Oppo, while Oppo has not made fair offers and is delaying.”

The two companies have been locked in legal battles since July 2021 as they have failed to agree new FRAND licensing fees for Nokia’s 5G patents. Nokia has sued Oppo in more than 10 countries, including the United Kingdom, the Netherlands, France, Sweden, and Finland, with mixed results.

The Chongqing court also decided on acceptable licensing fees for Nokia's patent packages for second- to fifth-generation wireless communications in several regions. The fee in the first global zone is USD1.151 per 5G phone, while that in the second zone (which includes China) and the third zone is 70.7 US cents.

For 4G phones, the fee is capped at 77.7 US cents per handset in the first zone, while in the second and third zones its is 47.7 US cents.

Editor: Emmi Laine