CELEX: 62002CJ0100
Directive 89/104/EEC
Limitation of the effects of a trade mark in relation to indications concerning geographical origin
Use of a geographical indication as a trade mark as an element of use in accordance with honest practices in industrial or commercial matters

By order of 7 February 2002, received at the Court on 18 March 2002, the Bundesgerichtshof (Federal Court of Justice) referred
to the Court for a preliminary ruling under Article 234 EC two questions on the interpretation of Article 6(1)(b) of First
Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks (OJ
1989 L 40, p. 1).
Those questions were raised in proceedings between Gerolsteiner Brunnen GmbH & Co. (
Gerolsteiner Brunnen) and Putsch GmbH (
Putsch) concerning the alleged infringement of Gerolsteiner Brunnen's trade mark rights by Putsch's use of the term
KERRY Spring on labels on soft drinks marketed by Putsch.
Legal background
According to the first recital in the preamble to Directive 89/104, the purpose of that directive is to abolish existing disparities
which may impede the free movement of goods and freedom to provide services and may distort competition within the common
market.
Article 6(1)(b) of that directive, entitled
Limitation of the effects of a trade mark, provides:
1.
The trade mark shall not entitle the proprietor to prohibit a third party from using, in the course of trade,
...
(b)
indications concerning the kind, quality, quantity, intended purpose, value, geographical origin, the time of production of
goods or of rendering of the service, or other characteristics of goods or services;
...provided he uses them in accordance with honest practices in industrial or commercial matters.
The Gesetz über den Schutz von Marken und sonstigen Kennzeichen (German law on the protection of trade marks and other distinctive
signs) of 25 October 1994 (BGBl. 1994 I, p. 3082, 1995 I, p. 156;
the Markengesetz) transposed Directive 89/104 into German law.
Paragraph 23 of the Markengesetz, entitled
Use of names and descriptive indications; Trade in spare parts, provides: The proprietor of a trade mark or a commercial name shall not be entitled to prevent a third party from using, in the course
of trade,...
2.
a sign identical or similar to the trade mark or commercial name as an indication concerning characteristics or particularities
of goods or services such as, in particular, their kind, quality, intended purpose, value, geographical origin or time of
production or rendering,
...provided that that use is not contrary to honest practices.
The dispute in the main proceedings and the questions referred for a preliminary ruling
Gerolsteiner Brunnen bottles mineral water and produces soft drinks with a mineral water base and markets them in Germany.
It is the proprietor of word mark No 1100746
Gerri, registered in Germany with priority dated 21 December 1985, and of German word/figurative marks Nos 2010618, 2059923, 2059924
and 2059925, which contain the word
GERRI. Those trade marks cover mineral water, non-alcoholic beverages, fruit-juice based drinks and lemonades.
Since the mid-1990s Putsch has marketed soft drinks in Germany bearing labels including the words
KERRY Spring. Those drinks are manufactured and bottled in Ballyferriter in County Kerry, Ireland, by the Irish company Kerry Spring Water
using water from a spring called
Kerry Spring.
Gerolsteiner Brunnen commenced proceedings against Putsch in the German courts for infringement of its trade mark rights.
At first instance, the Landgericht München (Munich Regional Court) essentially found for Gerolsteiner Brunnen and restrained
Putsch from using the distinctive sign
KERRY Spring for mineral water or soft drinks. On appeal by Putsch, however, the Oberlandesgericht München (Munich Higher Regional Court)
dismissed Gerolsteiner Brunnen's claims. Gerolsteiner Brunnen then brought an appeal on a point of law (
Revision) before the Bundesgerichtshof.
The Bundesgerichtshof considers that the conditions for the likelihood of aural confusion for the purposes of Article 5(1)(b)
of Directive 89/104 are met in the main proceedings. In those circumstances, the outcome of the appeal on a point of law depends
on the interpretation of Article 6(1)(b) of Directive 89/104 and, more particularly, on whether use
as a trade mark excludes the applicability of that provision.
In those circumstances, by order of 7 February 2002, the Bundesgerichtshof decided to stay proceedings and to refer the following
questions to the Court for a preliminary ruling:
1.
Is Article 6(1)(b) of the First Trade Mark Directive also applicable if a third party uses the indications referred to therein
as a trade mark (markenmässig)?
2.
If so, must that use as a trade mark be taken into account when considering, pursuant to the final clause of Article 6(1)
of the First Trade Mark Directive, whether use has been in accordance with
honest practices in industrial or commercial matters?
The questions referred for a preliminary ruling
By the questions referred for a preliminary ruling, which will be taken together, the referring court asks the Court about
the scope of Article 6(1) of Directive 89/104 in a situation such as that in the main proceedings.
The referring court notes that there are differing views on whether the use of a geographical indication to distinguish goods
and identify their origin, which it describes as use
as a trade mark (
markenmässig), means that Article 6(1) of Directive 89/104 does not apply.
The Commission pointed out by reference to the drafting history of Directive 89/104 that Article 5 of the proposal for a first
Council Directive to approximate the laws of the Member States relating to trade marks (OJ 1980 C 351, p. 1) (which became
Article 6 of Directive 89/104) laid down the formula
provided he does not use them as a trade mark. However, that formula was replaced in the amended proposal (COM (85) 793 final (OJ 1985 C 351, p. 4)) by the words
provided he uses them in accordance with honest industrial or commercial practice. The Commission adds that it is apparent from the statement of reasons for the amended proposal that that substitution was
made in the interests of greater clarity.
In those circumstances, an expression such as
as a trade mark cannot be regarded as appropriate for determining the scope of Article 6 of Directive 89/104.
In order better to define its scope in circumstances such as those in the main proceedings it should be borne in mind that,
by a limitation of the effects of the rights derived from Article 5 of Directive 89/104 by the proprietor of a trade mark,
Article 6 of that directive seeks to reconcile the fundamental interests of trade-mark protection with those of free movement
of goods and freedom to provide services in the common market in such a way that trade mark rights are able to fulfil their
essential role in the system of undistorted competition which the Treaty seeks to establish and maintain (see,
inter alia
, Case C-63/97
BMW
[1999] ECR I-905, paragraph 62).
Article 5(1) of Directive 89/104 allows the proprietor of a trade mark to prevent all third parties from using, in the course
of trade, any sign which is identical with the trade mark in relation to goods which are identical with those for which the
trade mark is registered (Article 5(1)(a)) and any sign where, because of its identity with, or similarity to, the trade mark
and the identity or similarity of the goods in question, there exists a likelihood of confusion on the part of the public
(Article 5(1)(b)).
Article 6(1)(b) of Directive 89/104 provides that the proprietor of the trade mark may not prohibit a third party from using,
in the course of trade, indications concerning,
inter alia
, the geographical origin of goods provided the third party uses them in accordance with honest practices in industrial or
commercial matters.
It should be noted that that provision draws no distinction between the possible uses of the indications referred to in Article
6(1)(b) of Directive 89/104. For such an indication to fall within the scope of that article, it suffices that it is an indication
concerning one of the characteristics set out therein, like geographical origin.
The main proceedings in the present case concern, first, the trade mark
GERRI, which has no geographical connotation and, second, the sign
KERRY Spring, which refers to the geographical origin of the water used in the manufacture of the product in question, the place where
the product is bottled and the place where the producer is established.
The Commission emphasised the geographical nature of the expression
KERRY Spring by noting that
Kerry Spring is expressly included in the list of mineral waters recognised by Ireland for the purposes of Council Directive 80/777/EEC
of 15 July 1980 on the approximation of the laws of the Member States relating to the exploitation and marketing of natural
mineral waters (OJ 1980 L 229, p. 1) (see the list of natural mineral waters recognised by the Member States published by
the Commission in OJ 2002 C 41, p. 1).
The referring court finds that there exists a likelihood of aural confusion for the purposes of Article 5(1)(b) of Directive
89/104 between
GERRI and
KERRY since experience shows that, when ordering orally, customers shorten
KERRY Spring to
KERRY.
The question therefore arises whether such a likelihood of confusion between a word mark and an indication of geographical
origin entitles the proprietor of the trade mark to rely upon Article 5(1)(b) of Directive 89/104 to prevent a third party
from using the indication of geographical origin.
In answering that question, the only test mentioned in Article 6(1) of Directive 89/104 is whether the indication of geographical
origin is used in accordance with honest practices in industrial or commercial matters. The condition of
honest practice constitutes in substance the expression of a duty to act fairly in relation to the legitimate interests of the trade mark
owner (
BMW
, cited above, paragraph 61).
The mere fact that there exists a likelihood of aural confusion between a word mark registered in one Member State and an
indication of geographical origin from another Member State is therefore insufficient to conclude that the use of that indication
in the course of trade is not in accordance with honest practices. In a Community of 15 Member States, with great linguistic
diversity, the chance that there exists some phonetic similarity between a trade mark registered in one Member State and an
indication of geographical origin from another Member State is already substantial and will be even greater after the impending
enlargement.
It follows that, in a case such as that in the main proceedings, it is for the national court to carry out an overall assessment
of all the relevant circumstances. Since the case concerns bottled drinks, the circumstances to be taken into account by that
court would include in particular the shape and labelling of the bottle in order to assess, more particularly, whether the
producer of the drink bearing the indication of geographical origin might be regarded as unfairly competing with the proprietor
of the trade mark.
The answer to the questions referred for a preliminary ruling must therefore be that Article 6(1)(b) of Directive 89/104 is
to be interpreted as meaning that, where there exists a likelihood of aural confusion between a word mark registered in one
Member State and an indication, in the course of trade, of the geographical origin of a product originating in another Member
State, the proprietor of the trade mark may, pursuant to Article 5 of Directive 89/104, prevent the use of the indication
of geographical origin only if that use is not in accordance with honest practices in industrial or commercial matters. It
is for the national court to carry out an overall assessment of all the circumstances of the particular case in that regard.
Costs
The costs incurred by the Greek and United Kingdom Governments and the Commission, which have submitted observations to the
Court, are not recoverable. Since these proceedings are, for the parties to the main action, a step in the proceedings pending
before the national court, the decision on costs is a matter for that court.
On those grounds,
THE COURT (Fifth Chamber),
in answer to the questions referred to it by the Bundesgerichtshof by order of 7 February 2002, hereby rules:
Article 6(1)(b) of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating
to trade marks is to be interpreted as meaning that, where there exists a likelihood of aural confusion between a word mark
registered in one Member State and an indication, in the course of trade, of the geographical origin of a product originating
in another Member State, the proprietor of the trade mark may, pursuant to Article 5 of Directive 89/104,
prevent the use of the indication of geographical origin only if that use is not in accordance with honest practices in industrial
or commercial matters. It is for the national court to carry out an overall assessment of all the circumstances of the particular
case in that regard.
Jann
Timmermans
Edward
Delivered in open court in Luxembourg on 7 January 2004.
R. Grass
V. Skouris
Registrar
President
–
Language of the case: German.