Honda v Patmanidi: CJEU quietly gives a reasoned order

 The Monomeles Protodikeio: an insider's view

Last December the IPKat reported on Case C-535/13 Honda Giken Kogyo Kabushiki Kaisha v Maria Patmanidi SA, a request by a Greek court, the Monomeles Protodikeio Athinon, for a preliminary ruling from the Court of Justice of the European Union (CJEU). The underlying dispute involved the importation of parallel imports from outside EEA into Greece and more specifically to international exhaustion under the General Agreement on Tariffs and Trade (GATT: the fore-runner of the World Trade Organization, WTO) and TRIPS and competition law under Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU). In that reference the Greek court asked

What is the scope of ... Article 7 of Directive 89/104 (now Article 7 of Directive 2008/95 [the Trade Mark Directive] and of Article 13 of Regulation 40/94 (now Article 13 of Regulation 207/2009 [the Community Trade Mark Regulation]) in relation to the right of a trade mark proprietor to prohibit parallel imports into the EU and the EEA of its products which were first supplied or put on the market in a country outside the EU and the EEA, especially in the case of products with a large profit margin and price squeezing, as evidenced by large fluctuations in pricing policy, and/or where parallel imports may result in considerable reductions in prices to end consumers, for their benefit and the benefit of competition, as in the case of all types of spare parts for motor vehicles, in light of the effect, in isolation or combination, of: (a) the provisions of Articles 101 and 102 TFEU; (b) the provisions of Articles I, XI.1, ΙΙΙ.4 and XX(d) and GATT 1994 law in general; and (c) Articles I and [Χ]XIV GΑΤΤ 1994, especially as they extend the scope of the provisions of Article 7(1) of Directive 2008/95 and of Article 13(1) of Regulation 207/2009 to products put on the market in contracting parties of the GΑΤΤ 1994 and reciprocity issues arise between them?

"This is a rather unreported case", truthfully says Katfriend and Greek attorney Maria Kilimiris (Patronos & Kilimiris, Athens), adding that on 17 July the CJEU issued a reasoned order. While this order is available only in Greek and French, Maria's linguistic talents have been utilised in order to enrich the understanding of all readers of this weblog (thanks, Maria, take a katpat).  Explains Maria (who acted for trade mark owners Honda):

Articles 101 and 102 TFEU do not affect the content of the existing case law. When, as in the present case, the proprietor of a trade mark prohibits the importation of products which bear his trade mark from a country outside the European Union and the European Economic Area, without his consent, this act, considered individually, cannot be regarded as an “agreement” or as “concerted practice” liable to affect trade between Member States and having as its object or as effect the prevention, restriction or distortion of competition within the internal market, within the meaning of Article 101 TFEU or as “abuse of position“ within the meaning of Article 102 TFEU [indeed, it's difficult how the CJEU could say anything else -- but Merpel wants to know why the referring court wasn't confident enough to reach this conclusion without feeling that it was necessary to get this guidance].

Finally, as regards the GATT 1994 Agreement and the TRIPS Agreement, which constitute an integral part of the WTO Agreement, it is sufficient to note that the contracting parties did not settle the issue of exhaustion of IP rights, as is apparent in particular from Article 6 of TRIPS, according to which 

“ for the purposes of dispute settlement under this Agreement, subject to the provisions of Articles 3 and 4 nothing in this Agreement shall be used to address the issue of the exhaustion of intellectual property rights”. 

Under these circumstances, Directive 89/104 and Regulation 40/94 cannot reasonably be interpreted under the WTO Agreement as to the exhaustion of rights conferred by a trade mark.

Given the above considerations, the answer to the question referred must be that Articles 5 and 7 of Directive 89/104, as well as Articles 9 and 13 of Regulation 40/94, have the meaning that the proprietor of a trade mark may prohibit the first supply on the market within the EU and the EEA, without his consent, of genuine products bearing its trade mark.

Says Maria "I will be happy to provide more information on this case". To contact her, just email here.

Honda: the Cog here
Honda: the Dog here