Boehringer Ingelheim KG and Others v Swingward Ltd and Dowelhurst Ltd.
Date: 2007-04-26
14. It must be borne in mind that the specific subject-matter of a mark is to guarantee the origin of the product bearing that mark and that repackaging of that product by a third party without the authorisation of the proprietor is likely to create real risks for that guarantee of origin (see Boehringer Ingelheim and Others , paragraph 29).
15. According to the case-law of the Court, it is the repackaging of the trade-marked pharmaceutical products in itself which is prejudicial to the specific subject-matter of the mark, and it is not necessary in that context to assess the actual effects of the repackaging by the parallel importer (see Boehringer Ingelheim and Others , paragraph 30).
16. Under Article 7(2) of Directive 89/104, the trade mark proprietor’s opposition to repackaging, in that it constitutes a derogation from free movement of goods, cannot be accepted if the proprietor’s exercise of that right constitutes a disguised restriction on trade between Member States within the meaning of the second sentence of Article 30 EC (see, to that effect, Boehringer Ingelheim and Others , paragraphs 18 and 31).
17. A disguised restriction within the meaning of that provision will exist where the exercise by a trade mark proprietor of its right to oppose repackaging contributes to artificial partitioning of the markets between Member States and where, in addition, the repackaging is done in such a way that the legitimate interests of the proprietor are respected. This means, in particular, that the repackaging must not adversely affect the original condition of the product and must not be such as to harm the reputation of the mark (see Boehringer Ingelheim and Others , paragraph 32).
18. A trade mark proprietor’s opposition to repackaging of pharmaceutical products contributes to artificial partitioning of the markets between Member States where the repackaging is necessary in order to enable the product imported in parallel to be marketed in the importing State ( Boehringer Ingelheim and Others , paragraph 33).
19. Thus it is clear from settled case-law that the change brought about by any repackaging of a trade-marked pharmaceutical product – creating by its very nature the risk of interference with the original condition of the product – may be prohibited by the trade mark proprietor unless the repackaging is necessary in order to enable the marketing of the products imported in parallel and the legitimate interests of the proprietor are also safeguarded ( Bristol-Myers Squibb and Others , paragraph 57, and Boehringer Ingelheim and Others , paragraph 34).
20. Moreover, according to the Court’s case-law, a parallel importer which repackages a trade-marked pharmaceutical product must give prior notice to the trade mark proprietor that the repackaged product is being put on sale. At the request of the trade mark proprietor, the importer must also supply it with a sample of the repackaged product before it goes on sale. That requirement enables the proprietor to check that the repackaging is not carried out in such a way as directly or indirectly to affect the original condition of the product and that the presentation after repackaging is not such as to damage the reputation of the trade mark. It also affords the trade mark proprietor a better possibility of protecting himself against counterfeiting (see Bristol-Myers Squibb and Others , paragraph 78, and Boehringer Ingelheim and Others , paragraph 61).
21. Thus, the Court held, in paragraph 79 of Bristol-Myers Squibb and Others :
‘… Article 7(2) of Directive [89/104] is to be interpreted as meaning that the trade mark owner may legitimately oppose the further marketing of a pharmaceutical product where the importer has repackaged the product and reaffixed the trade mark unless
– it is established that reliance on trade mark rights by the owner in order to oppose the marketing of repackaged products under that trade mark would contribute to the artificial partitioning of the markets between Member States; such is the case, in particular, where the owner has put an identical pharmaceutical product on the market in several Member States in various forms of packaging, and the repackaging carried out by the importer is necessary in order to market the product in the Member State of importation, and also carried out in such conditions that the original condition of the product cannot be affected by it. …
– it is shown that the repackaging cannot affect the original condition of the product inside the packaging. …
– the new packaging clearly states who repackaged the product and the name of the manufacturer …
– the presentation of the repackaged product is not such as to be liable to damage the reputation of the trade mark and of its owner; thus, the packaging must not be defective, of poor quality, or untidy; and
– the importer gives notice to the trade mark owner before the repackaged product is put on sale, and, on demand, supplies him with a specimen of the repackaged product.’
Question 2(a): the concept of ‘repackaging’
23. In paragraph 6 of Boehringer Ingelheim and Others , the Court stated that the packaging of each of the pharmaceutical products concerned by the main proceedings, and the instruction leaflets going with them, had been to some extent altered for the purposes of importation into the United Kingdom.
24. In paragraph 7 of the judgment, it was observed that the manner in which the different products concerned had been repackaged varied. In some cases, a label setting out certain critical information, such as the name of the parallel importer and its parallel import licence number, had been attached to the original package. On such packages, wording in languages other than English therefore remained visible and the trade mark was not covered up. In other cases, the product had been repackaged in boxes designed by the parallel importer on which the trade mark was reproduced. Finally, in some cases, the product had been repackaged in boxes designed by the parallel importer which did not bear the trade mark. Instead, the generic name of the product had been marked on the box. Inside this box, the inner packaging bore the original trade mark but was overstickered with a label which indicated the generic name of the product as well as the identity of the manufacturer and of the parallel import licence holder. In all these cases of repackaging, the boxes contained an information leaflet for the patient written in English which bore the trade mark.
26. The Court stated in paragraph 55 of Boehringer Ingelheim and Others  that, by its fifth to seventh questions, the national court was seeking to obtain clarification of the requirement that the parallel importer must give advance notice to the trade mark proprietor that the repackaged product is to be put on sale.
28. It follows from the foregoing that in Boehringer Ingelheim and Others  the Court included in the concept of repackaging the relabelling which was undoubtedly one of the forms envisaged by the referring court in which the packaging of the medicinal products in question was altered.
32. Accordingly, the answer to Question 2(a) must be that Article 7(2) of Directive 89/104 must be construed as meaning that the proprietor may legitimately oppose further commercialisation of a pharmaceutical product imported from another Member State in its original internal and external packaging with an additional external label applied by the importer, unless
– it is established that reliance on trade mark rights by the proprietor in order to oppose the marketing of the overstickered product under that trade mark would contribute to the artificial partitioning of the markets between Member States;
– it is shown that the new label cannot affect the original condition of the product inside the packaging;
– the packaging clearly states who overstickered the product and the name of the manufacturer;
– the presentation of the overstickered product is not such as to be liable to damage the reputation of the trade mark and of its proprietor; thus, the label must not be defective, of poor quality, or untidy; and
– the importer gives notice to the trade mark proprietor before the overstickered product is put on sale, and, on demand, supplies him with a specimen of that product.’
Questions 1(b) and 2(c): the application, as regards the manner and style of repackaging, of the condition that there be a need to repackage the product
36. That condition that repackaging be necessary is fulfilled if the rules or practices in the importing Member State prevent the product in question from being marketed in that State in the same packaging as that in which those products are marketed in the exporting Member State (see, to that effect, Upjohn , paragraphs 37 to 39 and 43).
37. Conversely, the condition that it be necessary is not fulfilled if repackaging of the product is explicable solely by the parallel importer’s attempt to secure a commercial advantage (see Upjohn , paragraph 44).
38. Therefore, the condition that packaging be necessary is directed only at the fact of repackaging the product – and the choice between a new carton and oversticking – for the purposes of allowing that product to be marketed in the importing State and not at the manner or style in which it has been repackaged (see also the judgment of the EFTA Court in Case E‑3/02 Paranova  v Merck  [2003] EFTA Court Report 2004, p. 1, paragraphs 41 to 45).
39. The answer to Questions 1(b) and 2(c) must therefore be that the condition that the repackaging of the pharmaceutical product, either by reboxing the product and re-applying the trade mark or by applying a label to the packaging containing the product, be necessary for its further commercialisation in the importing Member State, as one of the conditions which, if fulfilled, prevent the proprietor under Article 7(2) of Directive 89/104 from opposing such commercialisation, is directed solely at the fact of repackaging and not at the manner and style of the repackaging.
Questions 1(c) and 2(d): the condition that the presentation of the repackaged product must not be such as to be liable to damage the reputation of the trade mark
42. The Court, in holding in paragraph 76 of the judgment in Bristol-Myers Squibb and Others  that defective, poor quality or untidy packaging could damage the trade mark’s reputation, merely referred to certain cases in which inappropriate presentation of the repackaged product is liable to damage the reputation of the trade mark and of its proprietor.
43. Accordingly, a repackaged pharmaceutical product could be presented inappropriately and, therefore, damage the trade mark’s reputation in particular where the carton or label, while not being defective, of poor quality or untidy, are such as to affect the trade mark’s value by detracting from the image of reliability and quality attaching to such a product and the confidence it is capable of inspiring in the public concerned (see, to that effect, Bristol-Myers Squibb and Others , paragraph 76, and Case C-337/95 Parfums Christian Dior  [1997] ECR I-6013, paragraph 45).
45. As the Commission correctly argues in its written observations, the fact that a parallel importer does not affix the trade mark to the new exterior carton (‘de-branding’) or applies either his own logo or a house-style or get-up or a get-up used for a number of different products (‘co-branding’), or positions the additional label so as wholly or partially to obscure the proprietor’s trade mark, or fails to state on the additional label that the trade mark in question belongs to the proprietor, or prints the name of the parallel importer in capital letters is, in principle, liable to damage the trade mark’s reputation.
46. However, precisely as with the question whether advertising is liable to create the impression that there is a commercial connection between the reseller and the trade mark proprietor and, therefore, constitute a legitimate reason within the meaning of Article 7(2) of Directive 89/104 (see Case C-63/97 BMW  [1999] ECR I-905, paragraphs 51 and 55), the question whether the circumstances referred to in the previous paragraph of the present judgment are liable to damage the trade mark’s reputation is a question of fact for the national court to decide in the light of the circumstances of each case.
51. If it were a matter for the national law of the Member States to determine the question of the onus of proving the existence of those conditions, which, if fulfilled, would prevent the proprietor from opposing further commercialisation of a repackaged pharmaceutical product, the consequence for trade mark proprietors could be that protection would vary according to the legal system concerned. The objective of ‘the same protection under the legal systems of all the Member States’ set out in the ninth recital in the preamble to Directive 89/104, and described as ‘fundamental’, would not be attained (see, to that effect, Case C‑405/03 Class International  [2005] ECR I-8735, paragraph 73).
52. In the light of the foregoing, it must be stated that, in situations such as those in the main proceedings, where it is established that the medicinal products which are the subject of parallel importation have been repackaged, it is for the parallel importers to prove the existence of the conditions referred to in paragraph 32 of the present judgment which, if fulfilled, would prevent the proprietors from lawfully opposing further commercialisation of those medicinal products (see, by analogy, Class International , cited above, paragraph 74).
54. The answer to Questions 1(a) and (e) and 2(b) must therefore be that, in situations such as those in the main proceedings, it is for the parallel importers to prove the existence of the conditions that:
– reliance on trade mark rights by the proprietor in order to oppose the marketing of repackaged products under that trade mark would contribute to the artificial partitioning of the markets between Member States;
– the repackaging cannot affect the original condition of the product inside the packaging;
– the new packaging clearly states who repackaged the product and the name of the manufacturer;
– the presentation of the repackaged product is not such as to be liable to damage the reputation of the trade mark and of its proprietor; thus, the repackaging must not be defective, of poor quality, or untidy; and
– the importer must give notice to the trade mark proprietor before the repackaged product is put on sale and, on demand, supply him with a specimen of the repackaged product,
and which, if fulfilled, would prevent the proprietor from lawfully opposing the further commercialisation of a repackaged pharmaceutical product.
As regards the condition that it must be shown that the repackaging cannot affect the original condition of the product inside the packaging, it is sufficient that the parallel importer furnishes evidence that leads to the reasonable presumption that that condition has been fulfilled. This applies a fortiori also to the condition that the presentation of the repackaged product must not be such as to be liable to damage the reputation of the trade mark and of its proprietor. Where the importer furnishes such initial evidence that the latter condition has been fulfilled, it will then be for the proprietor of the trade mark, who is best placed to assess whether the repackaging is liable to damage his reputation and that of the trade mark, to prove that they have been damaged.
The third question: the consequences of the absence of prior notice
55. According to the case-law of the Court, a parallel importer must, in any event, in order to be entitled to repackage trade-marked pharmaceutical products, fulfil the requirement of prior notice. If the parallel importer does not satisfy that requirement, the trade mark proprietor may oppose the marketing of the repackaged pharmaceutical product. It is incumbent on the parallel importer itself to give notice to the trade mark proprietor of the intended repackaging. It is not sufficient that the proprietor be notified by other sources, such as the authority which issues a parallel import licence to the importer ( Boehringer Ingelheim and Others , paragraphs 63 and 64).
58. In that respect, it must be borne in mind that the Member States are required, within the bounds of the freedom left to them by the third paragraph of Article 249 EC, to choose the most appropriate forms and methods to ensure the effectiveness of directives, in the light of their objective (see Case 48/75 Royer  [1976] ECR 497, paragraph 75, and Joined Cases C-58/95, C-75/95, C-112/95, C‑119/95, C-123/95, C‑135/95, C‑140/95, C-141/95, C-154/95 and C‑157/95 Gallotti and Others  [1996] ECR I-4345, paragraph 14, and Case C‑212/04 Adeneler and Others  [2006] ECR I-6057, paragraph 93).
59. Accordingly, where, as in the case in the main proceedings, Community law does not lay down any specific sanctions where infringements have been committed, it is incumbent on the national authorities to adopt appropriate measures to deal with such a situation. Those measures must be not only proportionate, but also sufficiently effective and a sufficient deterrent to ensure that Directive 89/104 is fully effective (see, to that effect, Adeneler and Others , cited above, paragraph 94).
60. It should be recalled, as is clear, in particular, from paragraph 21 of the present judgment, that for the trade mark proprietor to be able lawfully to oppose further marketing of a repackaged pharmaceutical product it is sufficient that one of the conditions set out in paragraph 79 of Bristol-Myers Squibb and Others  is not fulfilled.