Parallel Importer

Parallel Importer – Parallel imports of goods within the European Union – how useful is a trademark?

Parallel importer – the European Pharma Case. It’s been a long time coming, but I’ve finally got round to reviewing this important appeal judgment for parallel importers. I had actually prepared the notes for this article at the beginning of March 2015, however being gratefully inundated with work, I’ve only found the time, on a Saturday in April to finish the job. So here goes! The judgment this article reviews is in the case of – Speciality European Pharma Ltd Claimant/Respondent v. (1) Doncaster Pharmaceutical Comp Ltd (2) Madaus GMBH Defendant/Respondent – Appeal Judgment 06/02/2015. The case concerns the free movement of goods and services within the European Union (EU) and the potential of brand owners to use trade mark law to prohibit imports.

The judgment arises from an appeal from the lower court judgment in favour of Speciality European Pharma Ltd. In a nutshell, the important issue was where a pharmaceutical manufacturer markets the same product in an EU member state as in another EU member state but under different marks, can a parallel importer take the goods in one of those member states and re-brand them in the other member state with that different brand?

The law covered in the judgment are:

1. Necessity to replace the trade mark was the overriding test to be decided on a case-by-case basis. The condition of necessity is satisfied if, in a specific case, the prohibition imposed on the importer against replacing the trade mark hinders effective access to the market of the importing member state.

2. Article 34 and 36 of Treaty on the furthering of the European Union (TFEU); Article 7 of Directive 89/104/EEC (now Article 7 of Directive 2008/95/EC); and case law.

LJ Floyd concluded:-

i) If it is established that it is necessary to re-brand then the trade mark owner may not enforce its mark against parallel imported goods.

ii) Effective access to the market is not obstructed by being able to place some goods on the market.

iii) It may be necessary to re-brand where the parallel importer is excluded from a substantial part of the market or from a significant proportion of consumers.

iv) The court must decide what alternatives are available for the parallel importer and whether they are realistic.

v) Necessity to re-brand is decided by national courts on a case by case basis.

The appeal was denied on the basis that the enforcement of the trade mark did not create an artificial position in the market in a way which was unlawful on the facts of this particular case.

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