Business Alert - EU
Business Alert - EU |
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ECJ rules that trade mark protection does not apply to goods in transit On 9 November 2006, the European Court of Justice (ECJ) handed down a ruling on trade marks in the case of Montex Holdings Ltd v Diesel SpA. The provisions of the ruling can have implications for Hong Kong traders of textiles and clothing, and the free movement of such articles within the European Union. The ECJ's ruling was in response to three questions referred from a German court in the context of a dispute between Diesel and Montex. The dispute concerned the transit through German territory of goods belonging to Montex, a company of Irish origin, which was producing jeans in Poland before transporting them to Ireland. The jeans in question bear a sign identical to the registered trade mark of which Diesel is the proprietor in Germany. Hong Kong's clothing manufacturers will be well aware of the Diesel label, which purportedly caters for the more "trendy" among us. However, Diesel does not own a trade mark in Ireland and so cannot stop the sale of the jeans in that Member State. Instead Montex owns a registered "Diesel" mark in Ireland. On 31 December 2000, German Customs stopped a delivery, intended for Montex, of 5,076 pairs of women's trousers, bearing the name "Diesel". The trousers were to be transported uninterrupted from the Polish customs office to the customs office in Dublin, and were protected against removal in transit by a customs seal. Diesel claimed that the goods could have been put on the market in Germany and therefore infringed its trade mark. Montex objected to the seizing of the goods, claiming that mere transit was not an infringement of Diesel's trade mark and that the goods could not have been put on the market in the transit Member State as they were protected by a customs seal and it was therefore clearly indicated that they were just being transported through that Member State. The German Court of Instance ruled in favour of Diesel. Montex appealed and the appeal court referred its questions to the ECJ. The ECJ ruled that a trade mark holder can only prohibit the transit of goods through a Member State in which that trade mark is protected if it can demonstrate that the goods in question are at risk of being on the market in that Member State of transit. The ECJ further stated that, for the purposes of the question referred to it, it is not relevant whether goods whose destination is a Member State come from within or from outside the European Economic Area and it is also irrelevant whether or not the goods have been manufactured in infringement of existing trade mark rights. This ruling is interesting for Hong Kong traders as it both clarifies the issue of trade mark protection in the EU and the parameters set for that protection. Producers will be interested in ensuring that their brands are protected in all Member States. Where a trade mark is protected in some Member States and not others, there is nothing to stop importers shipping their products through a Member State where such protection is not in force, provided they have clear proof that there is no risk of the goods concerned being put on the market in transit Member States. However, if a producer could prove that there was evidence of a significant threat that the owner of the goods might have put the goods on the market in the Member State of transit, the ECJ might well have ruled against Montex. Factors, such as infringements by the owner of the goods relating to the trade mark, even in a third country, might have provided an indication of an intention on its part to put the goods on the market in the country of transit. | ||||||||||||||||||||||||||||||||||
