Nokia, the Finnish telecommunications equipment manufacturer, announced on Thursday that it had finalized a 5G patent agreement with Honor, a leading smartphone maker in China. Nevertheless, the company continues its legal fights with other Chinese firms over patent issues.

Once the top mobile phone producer globally, Nokia possesses an ample patent portfolio, consisting of critical technologies required for mobile phone production. This portfolio generated considerable licensing revenue, accounting for 39% of the operating profit in 2022.

Since 2021, Nokia has been embroiled in legal disputes with Chinese device producers, Oppo and Vivo, concerning the usage of 4G and 5G patents; these dispute are yet to be resolved.

The Finnish company expressed its satisfaction over the amicable treaty with Honor, formally a division of the US-sanctioned Huawei Technologies. This satisfaction persists despite a recent setback in a Chinese court which ruled in favor of Oppo, supporting their call for reduced royalty rates for Nokia's technologies.

Referring to the agreement with Honor, Suanna Martikainen, Nokia’s Chief Licensing Officer, stated, This is the fourth litigation-free smartphone agreement that Nokia has concluded in the past twelve months.

Throughout the initial three quarters of 2023, licensing income formed over half of Nokia's operating profit, as its network infrastructure and mobile network sales saw a decline.

Chinese BBK Electronics owns Oppo and Vivo, whereas Huawei sold Honor to a consortium made up of over 30 agents and dealers in November 2020. During the third-quarter, Honor led the world’s largest smartphone market, China, in terms of handset shipments, selling 11.8 million units as reported by research firm Canalys.