FREE CIRCULATION OF GOODS

With trade-marks as for patents, there is a fundamental principle, which is that sole rights have a limitation.
This principle means that if a product with a particular trade-mark is put on the market in another EU country by the proprietor of the trade-mark or another entity with his consent, this product from that moment on can circulate freely within any other country in the Union. To be more exact, anyone who has bought the product can export it freely into another country and without any restriction with regard to the proprietor of the trade-mark.

Therefore, in the field of trade-marks too, parallel imports are considered lawful.
No obstacle to free circulation is admissible, nor can one speak of breach or infringement of a trade-mark when the product has been properly sold on the market of the member country from which it is imported, by the proprietor of the trade-mark himself or with his agreement.
For if the proprietor of the trade-mark could oppose the import of products bearing his trade-mark, he would be impeding the free circulation of goods within the common market (Centrofarm B.V. and Adrian de Peijper/Winthrop b.v., GADI, 1974, No 671; Dansk Supermarked A.S./Imerco A.S., GADI, 1981, No 1462).
It has happened on occasions that the author of a parallel import not only re-sold the product in another country, but also re-packaged it.
The Court declared that if the proprietor of a trade-mark put the same product on the market in several member states in different packages and asserted the rights of the trade-mark in order to prevent re-packaging by third parties, this behaviour could be considered a restriction, according to Art. 36 of the EEC Treaty.
The Court made it clear that, in this case, it is not possible to guarantee that the product, distributed in the member states in different packages, would be re-packaged without altering the product itself and at the same time guarantee the essential function of the trade-mark and the common origin of the product (Hoffmann-La Roche/Centrafarm, GADI, 1978, No 1112).

There are problems closely connected with those of parallel imports when the ownership of the same trade-mark, originally belonging to a single subject, is then split up among several subjects inside the Community.
One of the principal disputes is the Sirena case, for which please refer to:

• Sirena Srl/E.D.A., GADI, 1973, No 334;
• Novimpex Srl/Sirena Srl, GADI, 1983, No 1598;
• The impact of the “Sirena” decision on national trade-mark rights, IIC, 1972, 193.

In the Sirena case, the Court had already examined the following question: must Articles 85 and 86 of the EC Treaty be interpreted to mean that they prevent the proprietor of a trade-mark, legally filed in a member country, from asserting his right to prohibit products with the same trade-mark legally attached at the origin from being imported from other countries of the Community? The Court replied that although the trade-mark, “as a legal statute”, may not be subject to the concentration restrictions as per Art. 85, para. 1, however exercising the trade-mark may come within these restrictions if it is clear that by assigning the trade-mark on several occasions there has been an attempt to create closed frontiers between the member countries and to hinder inter-Community trade.
In the case in point, a question was raised by the Court of Milan, when an Italian Company which had bought from an American Company all the rights for Italy of the Prep trade-mark, tried to oppose the introduction into Italy by a German manufacturer who had stipulated a similar convention for Germany with the same American Company.

The typical hypothesis of parallel imports occurs when the trade-mark belongs to the same proprietor both in the country of origin of the products and in the country of destination. In such cases it may be that someone buys the original products in the first country and re-sells them in the second, without authorisation from the proprietor and in competition with his importer or exclusive licensee. Often the products imported in this way have extremely competitive prices.
Community rules on the free circulation of goods do not apply to imports from third countries outside the Community; these situations are not governed by Community law and are subject exclusively to national law.