Principle of Exhausting Trademark Rights: Challenges and Prospects

Igor V. Matveev, Rimma Sh. Rakhmatulina, Ekaterina A. Sviridova and Galina N. Chernichkina

The exhaustion of trademark rights should be recognized as a special case of the free use of a trademark and a peculiar restriction of the trademark holder’s monopoly with respect to the already sold goods. However, the use of a trademark should be restricted in accordance with the requirements of strict necessity, avoiding the deception of consumers regarding the legal and economic relations between the parallel importer and the trademark holder. Based on analyzing the European judicial practice, it has been concluded about limiting the principle of the trademark rights exhaustion in order to prevent unfair competition in the goods market. The holder’s right to prohibit the sale of goods this holder entered into the civil circulation and marked with their trademark, if this happens for legitimate reasons, in particular, when changes are made to the goods and cause the quality deterioration or a risk of deceiving the consumer, has been proved. The use of this approach is explained by the need to maintain the business reputation of the rights holder. After putting the original goods into civil circulation by the rights holder, the parallel importer has the right to resell them, but does not have the right to impersonate the holder of the trademark that individualizes the goods entered into circulation. In order to maintain the balance of rights and legitimate interests of rights holders and parallel importers, it has been suggested to prohibit the parallel import of goods to a certain country if the rights holder has entered into a license agreement under the exclusive license with a specific business entity in that country.

Volume 11 | 12-Special Issue

Pages: 1321-1329

DOI: 10.5373/JARDCS/V11SP12/20193342