Hoffman-La Roche v Centrafarm: ECJ 23 May 1978

ECJ (Judgement) 1. It is clear from article 36 of the EEC treaty, in particular its second sentence, as well as from the context, that whilst the treaty does not affect the existence of rights recognized by the laws of a member state in matters of industrial and commercial property, yet the exercise of those rights may nevertheless, depending on the circumstances, be restricted by the prohibitions contained in the treaty.
Inasmuch as it creates an exception to one of the fundamental principles of the common market, article 36 in fact admits of derogations from the free movement of goods only to the extent to which such exceptions are justified for the purpose of safeguarding the rights which constitute the specific subject-matter of that property.
2. In order to answer the question whether that exclusive right involves the right to prevent the trade-mark being affixed by a third person after the product has been repackaged, regard must be had to the essential function of the trade-mark, which is to guarantee the identity of the origin of the trade-marked product to the consumer or ultimate user, by enabling him without any possibility of confusion to distinguish that product from products which have another origin.
This guarantee of origin means that the consumer or ultimate user can be certain that a trade-marked product which is sold to him has not been subject at a previous stage of marketing to interference by a third person, without the authorization of the proprietor of the trade-mark, such as to affect the original condition of the product.
The proprietor of a trade-mark right which is protected in two member states at the same time is justified pursuant to the first sentence of article 36 of the treaty in preventing a product to which the trade-mark has lawfully been applied in one of those states from being marketed in the other member state after it has been repacked in new packaging to which the trade-mark has been affixed by a third party.
However, such prevention of marketing constitutes a disguised restriction on trade between member states within the meaning of the second sentence of article 36 of the treaty where;
– it is established that the use of the trade-mark right by the proprietor, having regard to the marketing system which he has adopted, will contribute to the artificial partitioning of the markets between member states;
– it is shown that repackaging cannot adversely affect the original condition of the product;
– the proprietor of the mark receives prior notice of the marketing of the repackaged product; and
– it is stated on the new packaging by whom the product has been repackaged.
3. To the extent to which the exercise of a trade-mark right is lawful in accordance with the provisions of article 36 of the treaty, such exercise is not contrary to article 86 of the treaty on the sole ground that it is the act of an undertaking occupying a dominant position on the market if the trade-mark right has not been used as an instrument for the abuse of such a position.
[1978] ECR 1139, [1978] 3 CMLR 217, [1978] FSR 598, [1978] ECR I-1139, C-102/77, R-102/77, [1978] EUECJ R-102/77
Bailii
EEC Treaty 36 86
Cited by:
CitedOracle America Inc v M-Tech Data Ltd SC 27-Jun-2012
The appellant complained that the respondent had imported into the European Economic Area disk drives bearing its trade marks in breach of the appellant’s rights. The respondent had argued that the appellant had abused its position by withholding . .
[2012] UKSC 27, [2012] 1 WLR 2026, UKSC 2010/0203, [2012] ETMR 43, [2012] Bus LR 1631, [2012] 1 WLR 2026, [2012] 3 CMLR 28, [2012] 4 All ER 338, [2012] ECC 27, [2012] Eu LR 727

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Updated: 20 December 2020; Ref: scu.132530