Judgment;Summary — ECLI:EU:C:2023:791
Date: 2023-10-19
Language of the case: Bulgarian
Court formation: Fourth Chamber
Subject matter: Intellectual, industrial and commercial property;Approximation of laws;Fundamental rights;Charter of Fundamental Rights
Procedure: Reference for a preliminary ruling;Reference for a preliminary ruling - inadmissible
Origin: Bulgaria

Summary C-655/21 – 1 
Case C-655/21 
Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged:  
27 October 2021 
Referring court:  
Rayonen sad Nesebar (Bulgaria) 
Date of the decision to refer:  
14 October 2021 
Accused person:  
G. ST. T. 
Prosecuting authority:  
Rayonna prokuratura Burgas, TO Nesebar 
  
Subject matter of the main proceedings 
(Judicial) criminal proceedings concerning an offence under Article 172b of the 
Nakazatelen kodeks (Criminal Code; ‘the NK’) – Use of a trade mark by the 
accused person in the course of trade without the trade mark proprietor’s consent 
Subject matter and legal basis of the request 
The referring court seeks to ascertain, on the basis of Article 267 TFEU, whether 
Directive 2004/48 permits national legislation and case-law in accordance with 
which the harm suffered by the trade mark proprietor is part of the constituent 
elements of the offences referred to in Article 172b(1) and (2) of the NK and, if 
so, whether the automatic presumption, introduced by national case-law, for 
determining the extent of that harm is permissible under that directive. 
Furthermore, the question arises as to whether Article 49 of the Charter of 
Fundamental Rights of the European Union permits penalties such as those 
provided for in Article 172b(2) of the NK and the lack of a distinction between the 
EN 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-655/21 
 
2  
offences under Article 172b of the NK and the corresponding administrative 
offence.  
Questions referred for a preliminary ruling 
1. Are the legislation and case-law in accordance with which the harm suffered 
by the trade mark proprietor forms part of the constituent elements of the 
offences referred to in Article 172b(1) and (2) of the NK consistent with the 
standards introduced by Directive 2004/48/EC of the European Parliament 
and of the Council of 29 April 2004 in relation to harm caused by the 
unlawful exercise of intellectual property rights? 
2. If the first question is answered in the affirmative, is the automatic 
presumption, introduced by case-law in the Republic of Bulgaria, for 
determining the harm – in the amount of the value of the goods offered for 
sale, calculated on the basis of the retail prices of lawfully manufactured 
goods – consistent with the standards of Directive 2004/48/EC of the 
European Parliament and of the Council of 29 April 2004? 
3. Is legislation which does not distinguish between an administrative offence 
(Article 127(1) of the Zakon za markite i geografskite oznacheniya (Law on 
trade marks and geographical indications; ‘the ZMGO’) currently in force 
and Article 81(1) of the ZMGO in force in 2016), the criminal offence under 
Article 172b(1) of the NK and, if the first question is answered in the 
negative, the criminal offence under Article 172b(2) of the NK compatible 
with the principle of legality of criminal offences, as enshrined in Article 49 
of the Charter of Fundamental Rights of the European Union? 
4. Are the penalties provided for in Article 172b(2) of the NK (custodial 
sentence of 5 to 8 years and a fine of BGN 5 000 to 8 000) consistent with 
the principle established in Article 49(3) of the Charter of Fundamental 
Rights of the European Union (the severity of penalties must not be 
disproportionate to the criminal offence)? 
Provisions of European Union law and case-law relied on 
Directive 2004/48/EC of the European Parliament and of the Council of 29 April 
2004 on the enforcement of intellectual property rights – recitals 26 and 28, 
Article 13 
Treaty on the functioning of the European Union – Articles 34-36 
Charter of Fundamental Rights of the European Union (‘the Charter’) – Article 49 
Judgment of 29 May 1997, Kremzow, C-299/95, EU:C:1997:254. 
G. ST. T. 
 
3 
Judgment of 6 October 2016, Procura della Repubblica (C-218/15, 
EU:C:2016:748) 
Judgment of 16 September 2013, Dornbracht v Commission, T-386/10, 
EU:T:2013:450 
Judgment of 12 December 2018, Biogaran v Commission, T-677/14, 
EU:T:2018:910. 
Provisions of national law and case-law relied on 
Zakon za markite i geografskite oznacheniya (Law on trade marks and 
geographical indications; ‘the ZMGO’) – Articles 13, 119 and 127 
Zakon za markite i geografskite oznacheniya (Law on trade marks and 
geographical indications, repealed, in force on 22 June 2016) – Articles 13, 76b 
and 81 
Nakazatelen kodeks (Criminal Code) – Articles 55, 66 and 172b, the latter of 
which reads as follows: 
(1) A person who, without the consent of the holder of the exclusive right, uses in 
the course of trade a trade mark, design, plant variety or animal breed which is the 
subject of that exclusive right, or uses a geographical indication or an imitation 
thereof without a legal basis, shall be punished by a term of imprisonment not 
exceeding five years and a fine not exceeding five thousand BGN. 
(2) If the act referred to in paragraph 1 is repeated or causes significant harmful 
effects, it shall be punishable by a term of imprisonment of five to eight years and 
a fine of five thousand to eight thousand BGN. 
(3) The object of the offence shall be confiscated and destroyed irrespective of 
whose property it is. 
Nakazatelno-protsesualen kodeks (Code of Criminal Procedure) – Articles 84-88 
and Article 247c 
Interpretative judgment No 1 of 31 May 2013 of the VKS (Supreme Court of 
Cassation) in interpretative case No 1/2013, OSNK (Plenum of the College of 
Criminal Judges) – point III.1  
Succinct presentation of the facts and procedure in the main proceedings 
1 The accused person G. ST. T. is the owner of ET ‘Silvia – G. T.’ ([registered] sole 
trader ‘Silvia – G. T.’). In the summer, the trader carries on the business of selling 
clothing in, inter alia, the ‘Slanchev briag’ (Sunny Beach) holiday resort in the 
territory of the municipality of Nesebar. In 2016, the [registered] sole trader rented 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-655/21 
 
4  
business premises located in the ‘Slanchev briag’ holiday resort. G. SТ. Т. 
purchased, from persons not identified in the case, wholesale clothing for the 
shop, bearing signs that resembled the trade marks ‘Armani’, ‘Armani Jeans’, 
‘Polo’, ‘Tommy Hilfiger’, ‘DSQUARED’, ‘DSQ’, ‘Calvin Klein’, ‘Boss’, ‘Hugo 
Boss’, ‘Gucci’, ‘D&G’, ‘Dolce & Gabanna’, ‘Adidas’, ‘Chanel’, ‘Paul & Shark’, 
‘LV’S’, ‘Levi’s’, ‘Burberry’, ‘Lacoste’, ‘Versace’, ‘Louis Vuitton’, ‘G Star’, 
‘Diesel’, ‘Holister’, ‘Yves Saint Laurent’, ‘YSL’, ‘Valentino’, ‘Philipp Plein’, 
‘Guess’, ‘Moschino’, ‘Pepe Jeans’, ‘Cerruti’, ‘Bershka’, ‘Paul Smith’, ‘Roberto 
Geissini’ and ‘Gap’. 
2 On 22 June 2016, police officers conducted an inspection of various commercial 
establishments, including the one run by G. ST. S. It was established on-site that 
the commercial establishment was open to customers and that a large number of 
items of clothing of various trade marks were offered for sale on the shelves. On 
the same day, the items bearing trade marks were seized. 
3 In the course of the preliminary investigation, expert reports on the seized goods 
were prepared, according to which the total value of the goods offered for sale 
amounted to BGN 1 404 590.00 in the case of the original clothing and 
BGN 80 201.00 in the case of the counterfeit clothing. According to the 
conclusions of the expert reports, there is similarity between the signs on the 
physical evidence and the registered trade marks, and complete identity between 
the physical evidence itself and the goods in respect of which the trade marks are 
registered. The similarity of the signs compared may lead to confusion on the part 
of consumers, which includes the possibility that the signs depicted on the 
physical evidence may be associated with the corresponding registered trade 
marks. 
4 In those circumstances, the indictment of the Public Prosecutor’s Office is based 
on the assumption that, without the consent of the owner of the exclusive right, 
G. ST. T. (in her capacity as a natural person carrying on business in the name of a 
[registered] sole trader) used, in the course of trade, trade marks which are the 
subject of that exclusive right by offering for sale, without any legal basis, goods 
bearing signs that were similar to the abovementioned trade marks. The Public 
Prosecutor’s Office proceeded on the assumption that the act caused ‘significant 
harmful consequences’, with the result that G. ST. T. was charged with an offence 
under Article 172b(2) of the NK. 
5 In the court proceedings, representatives of all the legal persons harmed (including 
those who have no representation in the territory of the Republic of Bulgaria) that 
had not asserted claims against the accused person and had not participated in the 
criminal proceedings as independent civil claimants were summoned on the basis 
of Article 247c(2) of the NPK (Criminal Code). 
G. ST. T. 
 
5 
Essential arguments of the parties in the main proceedings 
6 The referring court does not state what the position of the parties is on the 
questions referred. 
Succinct presentation of the reasoning in the request for a preliminary ruling 
First and second questions referred 
7 First, the referring court states that Article 13 of Directive 2004/48 provides 
judicial authorities with guidance for setting the damages for harm caused by an 
infringement of intellectual property rights, whereby those authorities are to take 
into account (1) the amount of lost profits, (2) the amount of the unfair profits 
made by the infringer, (3) moral prejudice (if any) and (4) the amount of royalties 
which would have been due if authorisation to use the trade mark in question had 
been requested. 
8 The referring court states that the offences referred to in Article 172b(1) and (2) of 
the NK were introduced in the Republic of Bulgaria within the scope of the 
discretion conferred by recital 28 of Directive 2004/48. There is also an 
administrative offence with similar constituent elements – see Article 81(1) of the 
ZMGO in force in 2016 and Article 127(1) of the ZMGO currently in force (an 
administrative penalty is to be imposed on a person who in the course of trade 
uses goods or services bearing a sign which is identical with or similar to a 
registered trade mark without the consent of its proprietor, within the meaning of 
Article 13 of the ZMGO).  
9 Next, the referring court refers to national case-law on the determination of the 
amount of harm caused by the offence under Article 172b of the NK and the 
relevance of that harm to the correct [criminal] categorisation of the act. Section 
III.1 of interpretative judgment No 1 of the VKS of 31 May 2013 states: ‘The use 
of the trade mark in the sale of goods is the result of expenditure and time invested 
in the creation of the trade mark proprietor’s commercial image. The negative 
economic consequences of its impairment are real and varied, but difficult to 
quantify using the known mechanisms of tort law. In point 2 of Article 76b(1) of 
the ZMGO [(repealed), point 2 of Article 119(1) of the ZGMO currently in force], 
the national legislature … created a legal presumption for assessing harm in the 
event of a trade mark infringement. If the claim [for damages] has been 
established as well founded, but insufficient information as to its amount has been 
provided, the claimant may claim as damages the equivalent of the retail prices of 
lawfully manufactured goods which are identical or similar to the infringing 
goods. That legal presumption is in line with the rule in criminal proceedings 
according to which only the harm suffered and not the lost profit is to be 
determined, and with the postulate that legal persons do not suffer non-material 
damage. Having regard to the specific nature of the right infringed under 
Article 172b of the NK, that view reflects the presumed economic consequences 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-655/21 
 
6  
of the impairment of an inherently intangible asset. The absolute amount of the 
harm thus determined serves as a practical guide for the correct categorisation as 
an offence under Article 172b of the NK and its distinction from administrative 
offences.’ 
10 The referring court concludes from the foregoing that Bulgarian legislation and 
case-law provide for an additional automatic presumption (beyond that provided 
for in Directive 2004/48) for establishing the amount of harm suffered as a result 
of the offence under Article 172b of the NK. The referring court states that a 
presumption that the harm caused by the offence under Article 172b of the NK 
corresponds to the equivalent of the retail prices of lawfully manufactured goods 
which are identical or similar to the infringing goods has been de facto introduced.  
11 However, the referring court takes the view that Directive 2004/48 does not 
provide for such an automatic presumption for the determination of the harm 
resulting from unlawful acts relating to industrial property, but allows for the four 
possibilities referred to in paragraph 7 above. However, all four of those 
possibilities are outside the scope of the constituent elements of the offence within 
the meaning of Article 172b of the NK. Accordingly, interpretive judgment No 1 
of 31 May 2013 expressly states that non-material damage cannot be included 
among the damage caused by the offence under Article 172b of the NK. It is also 
stated in that judgment that only the damage suffered, but not also the lost profit 
is determined in criminal proceedings. Those views correspond to Article 84(1) of 
the NPK, according to which injured legal persons may be constituted as civil 
claimants, but only in respect of the damage suffered by them as a result of the 
offence. 
12 The profit unfairly made by the infringer is outside the scope of the constituent 
elements of the offence under Article 172b of the NK, since the latter is a (formal) 
offence for which mere commission is sufficient and which materialises through 
the offering of goods for sale. In the present case, the accused person is charged 
with offering for sale specific goods which were secured in the commercial 
establishment, but is not additionally charged with selling such goods. The goods 
secured at the commercial establishment have been seized, and will subsequently 
be confiscated and destroyed. According to the interpretative judgment cited 
above, the value of those seized goods (in the amount of the retail prices of 
lawfully produced goods) also serves, in particular, to quantify the damage caused 
by the offence under Article 172b of the NK. 
13 The amount of the royalties or fees which would have been due if the infringer 
had requested authorisation to use the intellectual property right in question is also 
outside the scope of the constituent elements of the offence under Article 172b of 
the NK, because that amount is to be understood as being attributable to ‘lost 
profit’, that is to say, the amounts which were not received by the holders of the 
exclusive right but should have been received in the context of a normal 
commercial relationship. 
G. ST. T. 
 
7 
14 Therefore, the referring court takes the view that those inconsistencies give rise to 
a need for the provisions relating to damage in Directive 2004/48 to be interpreted 
from the point of view of the criminal liability introduced into Bulgarian law on 
the basis of recital 28 of that directive. 
Third question referred 
15 First, the referring court states that it is beyond dispute that the criminal offence 
under Article 172b of the NK and the administrative offence provided for in the 
ZMGO (with similar objective and subjective constituent elements) fall directly 
within the scope of EU law. This is because they are penalty-related provisions 
that are applicable to legal relationships that are substantively regulated in EU 
law. Directive 2004/48 expressly mentions the possibility (recital 28) of criminal 
sanctions as a means of ensuring the enforcement of intellectual property rights. 
The protection of trade mark rights is also enshrined in the Treaty on the 
Functioning of the European Union (Article 36).  
16 Next, the referring court refers to Article 49 of the Charter and emphasises that, in 
accordance with the case-law of the Court, the principle enshrined in Article 49(1) 
of the Charter is one of the general principles of EU law. That principle is 
inextricably linked to the need to establish a clear delimitation for the purpose of 
categorising certain conduct as an offence. In the present case, Bulgarian law does 
not contain a distinguishing criterion according to which an act can be categorised 
as either a criminal offence or administrative offence, since there are provisions in 
force which categorise the same conduct as an administrative offence 
(Article 127(1) of the ZMGO currently in force and Article 81(1) of the ZMGO in 
force in 2016) and as a criminal offence (Article 172b(1) of the NK). If it were to 
be assumed that, from the outset, the offence cannot cause harm establishing the 
constituent elements (that is to say, if the first question referred is answered in the 
negative), this would lead to the assumption that the offence described in 
Article 172b(2) also has constituent elements identical to those of the offence 
under Article 172b(1) of the NK and the administrative offence under the ZMGO.  
17 Therefore, the referring court asks its third question and states that the answer is 
of fundamental importance for the administration of justice in the Republic of 
Bulgaria, since the absence of a clear and precise distinguishing criterion leads to 
contradictory case-law and unequal treatment of legal persons which have 
committed virtually identical acts.  
Fourth question referred 
18 Article 49(3) of the Charter states: ‘The severity of penalties must not be 
disproportionate to the criminal offence.’ Article 172b(2) of the NK provides for 
custodial sentences of 5 to 8 years and a fine of five thousand to eight thousand 
BGN. That is a custodial sentence with a particularly high lower limit in terms of 
the sentencing range, and an upper limit that cannot be regarded as low either. It 
also provides for the cumulative imposition of heavy fines. The practical 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-655/21 
 
8  
possibilities for a reduction of the sentence (in the event of numerous mitigating 
circumstances) or for a stay of execution are limited to a minimum. This is 
because, on the one hand, the provision of point 1 of Article 55(1) of the NK 
allows only the imposition of a sentence below the lower limit of the sentencing 
range, but not the replacement of the custodial sentence, for example by a 
probationary period, and, on the other hand, the provision of Article 66(1) of the 
NK provides for the possibility of a stay only in respect of custodial sentences not 
exceeding three years.  
19 Moreover, according to the provision of Article 172b(3) of the NK, the object of 
the offence is confiscated and destroyed irrespective of whose property it is. 
Therefore, the perpetrator suffers the negative consequences of the destruction of 
all the goods, for the purchase of which he or she will have normally paid sums of 
money, plus a heavy fine, as well as a custodial sentence with a sentencing range 
which limits the possibilities of favourable treatment.  
20 In the light of the foregoing considerations, the referring court raises the question 
as to whether a penalty within that framework corresponds to the objective and 
subjective elements of the offence for which it is provided.