WRITTEN QUESTION E-0219/97 by Klaus-Heiner Lehne (PPE) to the Commission (5 February 1997)

Subject: International exhaustion

The trade marks Directive (89/104/EEC ((OJ L 40, 11.2.1989, p. 1. ))) was adopted in 1989. Since then, the courts of the Member States have developed divergent case-law on the question of 'international exhaustion'.

In its judgment of 14 December 1995 in Case I ZR 210/93, the German Bundesgerichtshof expressly confirmed that international exhaustion no longer applied.

On the other hand, the Belgian Tribunal de Commerce de Bruxelles, Salle des Référés, came to the opposite conclusion in its judgment of 11 October 1996 (C-349/95).

Were these consequences foreseen when the 1989 trade marks Directive was adopted, and were they intended?

Will the Commission take steps to belatedly rectify this situation?

Answer given by Mr Monti on behalf of the Commission (19 March 1997)

With a view to avoiding unjustified segmentation of the internal market and ensuring the free movement of goods or services protected by a trade mark, the Council, acting on a proposal from the Commission, has harmonized, at Community level, those aspects of national legislation on trade marks which most directly affect the functioning of the internal market. The Court of Justice has developed the theory of Community exhaustion in the cases coming before it.

Article 7(1) of the Trade Marks Directive ((First Council Directive of 21 December 1988 to approximate the laws of the Member States relating to trade marks (89/104/EEC), OJ L 40, 11.2.1989. )) embodies the principle of Community exhaustion as opposed to international exhaustion. It states that 'the trade mark shall not entitle the proprietor to prohibit its use in relation to goods which have been put on the market in the Community under that trade mark by the proprietor or with his consent'. It should be noted that, following the entry into force of the Agreement on the European Economic Area (EEA), the term 'Community' is to be read as 'European Economic Area'. This Article 7(1) is a comprehensive statement of the rule which is to govern exhaustion: it does not establish a minimum arrangement providing for exhaustion at least within the EEA, with the option for the Member States of applying the principle of international exhaustion if they so wish. In respect of exhaustion of rights, the Trade Marks Directive (like the Regulation on the Community trade mark ((Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark, OJ L 11, 14.1.1994. ))) provides for total harmonization of the areas it covers, and does not have a minimal or optional character, because that could create a new danger of segmentation of the internal market. This position is supported by an examination of the preparatory work on the Directive, which shows that the initial version did make provision for international exhaustion. The Commission's proposal was subsequently amended to reflect the positions of the Council and Parliament, which explicitly called for Community exhaustion.

As regards the divergent case-law referred to by the Honourable Member, it follows from the above that it is the judgment of the German Bundesgerichtshof which is in line with Directive 89/104/EEC. That judgment, in what is known as the Gefärbte Jeans or Dyed Jeans case ((OJ C 340, 29.12.1994. )), stated that since the entry into force of the new German law on the protection of trade marks the principle of the international exhaustion of the rights conferred by a trade mark no longer applied, so that the import of branded articles from third countries was illegal and could be prohibited by the proprietor. The judgment of the Belgian Tribunal de Commerce de Bruxelles, Salle des Référés, which is quoted as reaching the opposite conclusion, is therefore contrary to the Directive.

It is also drawn to the Honourable Member's attention that the Court of Justice currently has before it a request for a preliminary ruling under Article 177 of the EC Treaty from the Austrian supreme court, the Oberster Gerichtshof, which is concerned in particular with the interpretation to be given to Article 7(1) of the Trade Marks Directive, and should result in the matter being clarified definitively ((Case I ZR210/93, GRUR 1996, 271. )).

The Honourable Member might also usefully consult the Commission's joint answer to Written Questions E-3482/93, E-3483-93 and E-3484-93 by Mr Hoon ((Case C-355/96 Silhouette v Hartlauer. )), in which the Commission likewise states that to maintain the principle of international exhaustion would not be compatible with the Directive.