Research Handbook on Intellectual Property Exhaustion and Parallel Imports
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Research Handbook on Intellectual Property Exhaustion and Parallel Imports

  • Research Handbooks in Intellectual Property series

Edited by Irene Calboli and Edward Lee

From the Americas to the European Union, Asia-Pacific and Africa, countries around the world are facing increased pressure to clarify the application of intellectual property exhaustion. This wide-ranging Research Handbook explores the questions that pose themselves as a result. Should exhaustion apply at the national, regional, or international level? Should parallel imports be considered lawful imports? Should copyright, patent, and trademark laws follow the same regime? Should countries attempt to harmonize their approaches? To what extent should living matters and self-replicating technologies be subject to the principle of exhaustion? To what extent have the rise of digital goods and the “Internet of things” redefined the concept of exhaustion in cyberspace? The Handbook offers insights to the challenges surrounding these questions and highlights how one answer does not fit all.
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Chapter 18: Trademark exhaustion and its interface with EU competition law

Apostolos G. Chronopoulos and Spyros M. Maniatis

Extract

The exhaustion doctrine moulds trademarks into legal rights of exclusion, which are, in principle, solely pertaining to the initial commercialization of the trademarked good.1 Mirroring the common law principle against the imposition of restrictions on the alienation of chattels, the doctrine of exhaustion creates alternative commercial sources for commodities outside the trademark proprietor’s control and opens up collateral markets, all to the benefit of consumers. For the rights holder, there remains a single opportunity to devise a strategy for extracting revenue from the commercialization of the trademarked good when setting the price for the initial sale. This legal construct reflects the archetypical form of the doctrine. A more functional approach was dictated by the need to promote the proper functioning of the common market. Territorial trademark exhaustion has been qualified so that it may only be triggered by sales within the European Union (EU) or European Economic Area (EEA) market.2 Therein lies a decision of economic policy to protect the integration of the single market and incentivize European undertakings to exploit rent-seeking opportunities through price discrimination in international markets. The exhaustion doctrine is further mandated by EU primary law forbidding the partitioning of the internal market, in particular Articles 34 and 36 of the Treaty on the Functioning of the European Union (TFEU),3 which is a goal shared by EU competition law.

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