Achievements and New Perspectives
- European Intellectual Property Institutes Network series
Edited by Christophe Geiger
Chapter 15: Unfair competition: complementary or alternative to intellectual property in the EU?
The law of unfair competition can be characterized in that, unlike intellectual property rights, the scope of the legislation encompasses the functioning of the free market as a whole. The purpose of the law of unfair competition is to ensure that free and fair competition is maintained. Fair competition in a free market economy can be characterized by the fact that demand and supply determine the price of a product. This basic economic rationale that underlies a market economy requires that as a matter of principle there is freedom for competitors to copy and build upon the achievements of other market participants. Intellectual property rights can be justified as exclusive rights in relation to intellectual and industrial creativity only on the basis of the fact that they address specific instances of market failure in a market for original expressive works. In order to ensure a transparent and diversified market for products or services, the protection of trademarks or other badges of trade against confusing uses can equally be justified. Even the patent monopoly can be justified in the free market economy as it does not take away from the public something that existed before, but rather creates a competitive market in disclosed and novel inventive ideas themselves. In all instances public welfare is increased as more creative works will be produced, market transparency facilitates consumer choice, and technology can be incorporated in products, while disclosure opens claimed inventions up to scrutiny for improvement or alternatives.
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