Encyclopedia of Private International Law
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Encyclopedia of Private International Law

Edited by Jürgen Basedow, Giesela Rühl, Franco Ferrari and Pedro de Miguel Asensio

The role and character of Private International Law has changed tremendously over the past decades. With the steady increase of global and regional inter-connectedness the practical significance of the discipline has grown. Equally, so has the number of legislative activities on the national, international and, most importantly, the European level. With a world-class editor team, 500 content items and authorship from almost 200 of the world’s foremost scholars, the Encyclopedia of Private International Law is the definitive reference work in the field. 57 different countries are represented by authors who shed light on the current state of Private International Law around the globe, providing unique insights into the discipline and how it is affected by globalization and increased regional integration. The Encyclopedia consists of three inter-linked pillars, enhanced by sophisticated search and cross-linking functionality. The first pillar consists of A-Z coverage of the scope and substance of Private International Law in the form of 247 entries. The second pillar comprises detailed overviews of the Private International Law regimes of 80 countries. The third pillar presents valuable, and often unique, English language translations of the national codifications and Private International Law provisions of those countries. This invaluable combination represents a powerful research tool and an indispensable reference resource.
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Chapter C.16: CLIP

Pedro de Miguel Asensio

I. Foundation, background and context

The European Max Planck Group on Conflict of Laws in Intellectual Property (CLIP) was established in 2004 on the joint initiative of the Max Planck Institute for Comparative and International Private Law in Hamburg and the Max Planck Institute for Intellectual Property and Competition Law in Munich. The Group was composed of researchers of the two Max Planck institutes and other European scholars in the fields of intellectual property and private international law. The activities of the Group were funded by the Max Planck Society. The basic goal of CLIP was to draft a set of model principles on jurisdiction, applicable law and recognition and enforcement of judgments in intellectual property matters (→Intellectual property, applicable law; →Intellectual property, jurisdiction). This task was carried out without any official mandate and completed at the end of 2011, when the final text of the CLIP Principles was made public. Between 2004 and 2011 the Group acted also as a forum for the discussion of developments concerning intellectual property and private international law and provided independent advice to lawmakers in particular the European legislator.

The basic multilateral treaties on intellectual property – including those administered by WIPO and the TRIPS Agreement (Agreement of 15 April 1994 on Trade-Related Aspects of Intellectual Property Rights, 1869 UNTS 299) (→WIPO and private international law; →TRIPS) – devote little or no attention to private international law aspects of intellectual property disputes, such as those arising in connection with jurisdiction over multistate infringements. This situation contrasted at the end of the 20th century with the increasing awareness about the importance of establishing international standards better adapted to the needs of international litigation in this field. Such standards would contribute to overcoming the risks and drawbacks resulting from the restrictive position traditionally prevailing in most jurisdictions with regard to the cross-border adjudication of intellectual property claims. Moreover, the information technologies and the significance of digital networks in the global exploitation and use of contents protected by intellectual property pose extraordinary challenges to the coordination between the territorial nature of intellectual property rights and the increasing multinational and global scope of relevant activities.

Against this background, the first decade of the 21st century witnessed the development in different regions of the world of projects led by academics aimed at establishing model provisions with a view to contribute to law reform and foster a more efficient and fair regime for international disputes in civil matters involving intellectual property rights. Among the factors that influenced the appearance of those projects special attention should be afforded to the lack of progress in the development of international conventions in this area, as shown by the failure of the →Hague Conference on private international law to adopt an international convention on jurisdiction and foreign judgments in →civil and commercial matters. The failed negotiations at The Hague in connection with the 1999 p. 366Preliminary Draft Convention on Jurisdiction and the Effects of Judgments (HC Prel. Doc. No 11, available at <www.hcch.net>) and the particular controversy surrounding its provisions related to intellectual property made clear the difficulties that any project, seeking to establish a set of binding rules on international jurisdiction over intellectual property claims, would face at that stage.

As a reaction to those developments, two parallel initiatives led to the drafting of academic proposals in the USA (Rochelle Dreyfuss and Jane Ginsburg, ‘Draft Convention on Jurisdiction and Recognition of Judgments in Intellectual Property Matters’ (2002) 77 Chi-Kent L.Rev. 1065) and the EU (Josef Drexl and Annette Kur (eds), Intellectual Property and Private International Law: Heading for the Future (Hart 2005) 309–34), regarding provisions on jurisdiction in intellectual property intended to be adopted in international conventions. These two initiatives later developed into more ambitious projects to draft soft law principles covering not only jurisdiction, but also applicable law and recognition and enforcement in intellectual property matters. Mutual influence and inspiration were significant between these two projects. In the USA the American Law Institute (ALI) between 2003 and 2008 drafted and finally adopted its Principles Governing Jurisdiction, Choice of Law and Judgments in Transnational Disputes (American Law Institute, Intellectual Property: Principles Governing Jurisdiction, Choice of Law and Judgments in Transnational Disputes). In Europe the initiative started at the Munich Max Planck Institute was transformed in a different institutional setting. In 2004 it became a joint project of the two Max Planck Institutes in Hamburg and Munich named European Max Planck Group on Conflict of Laws in Intellectual Property (CLIP) including directors and members of both institutes and other European scholars. Influenced by these developments two additional projects developed since 2007 in Asia also aimed at drafting model provisions on private international law and intellectual property. The Japanese Transparency Proposal on Jurisdiction, Choice of Law, Recognition and Enforcement of Foreign Judgments in Intellectual Property was adopted in October 2009 (Jürgen Basedow, Toshiyuki Kono and Axel Metzger (eds), Intellectual Property in the Global Area: Jurisdiction, Applicable Law, and the Recognition of Judgments in Europe, Japan and the US (Mohr Siebeck 2012) 394–402). An initiative started at the Waseda University led to the adoption in October 2010 of an additional set of Principles as a ‘Joint Proposal’ drafted by members of the Private International Law Association of →Korea and →Japan (printed in [2011] The Quarterly Review of Corporation Law and Society 112–63).

II. Contribution to private international law

The main contribution by CLIP has been the drafting of a complete set of Principles covering international jurisdiction, the applicable law and recognition and enforcement of foreign judgments in the field of intellectual property. The final text of the CLIP Principles on Conflict of Laws in Intellectual Property was published in 2011 and the complete outcome of the project was made available in early 2013 when the Commentary to the Principles was published (CLIP, Conflict of Laws in Intellectual Property: The CLIP Principles and Commentary (OUP 2013)). The Commentary includes an article-by-article analysis structured in Comments and Notes, that explain each provision, its practical application with hypothetical illustrations, the interaction between the different articles, and provides a comparative analysis of the options preferred by the Group in light of the situation in national laws and European and international instruments and of the proposals made in the other parallel initiatives drafting model principles in the field. The authors of the Commentary were Jürgen Basedow, Pedro de Miguel Asensio, Josef Drexl, Graeme Dinwoodie, Christian Heinze, Annette Kur, Axel Metzger, Alexander Peukert, Paul Torremans and Mireille van Eechoud.

Preceding the adoption of the final text, CLIP made available three preliminary drafts and a draft of the Principles between April 2009 and March 2011. These texts rapidly became a basic reference in the legal literature in the field and the first draft significantly influenced the parallel projects in Asia. The Group also drafted recommendations to the European legislator in the process of reform of basic EU legislation on private international law. Such recommendations included comments on the Proposal and the Parliament report on the Rome I Regulation p. 367on the Law Applicable to Contractual Obligations (Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations (Rome I), [2008] OJ L 177/6) (→Rome Convention and Rome I Regulation) and suggestions for the amendment of the Brussels I Regulation (Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, [2001] OJ L 12/1) (→Brussels I (Convention and Regulation)) in particular with regard to the scope of exclusive jurisdiction in cross-border patent infringement disputes and to disputes regarding multiple defendants (CLIP ‘Exclusive Jurisdiction and Cross Border IP (Patent) Infringement: Suggestions for Amendment of the Brussels I Regulation’ [2007] EIPR 195 and CLIP ‘Intellectual Property and the Reform of Private International Law: Sparks from a Difficult Relationship’ [2007] IIC 471).

The documents produced by the Group rapidly came to the centre of the academic work and law reform debates in Europe and other regions and also influenced judicial practice in this area in Europe. The result was not only an increased awareness of possible options to achieve a more efficient adjudication of international disputes on intellectual property claims but also the direct impact of some of the proposals by the Group in order to transform previous practices by the national and European judiciaries in this area. Even before the final text of the Principles was adopted, proposals made by the Group were referred to expressly by the judiciary as foundation of progressive interpretations of national or EU law. Among such examples reference can be made to the important judgment of the UK Supreme Court in Lucasfilm (Lucasfilm Limited and others v Ainsworth and another [2011] UKSC 39) and to the Opinion of 12 April 2011 of Advocate General Trstenjak in Painer (Case C-145/10 Eva-Maria Painer v Standard VerlagsGmbH and others [2011] ECR I-12594). However, to assess the lasting contribution of CLIP to private international law the focus has to turn to the content of the CLIP Principles and Commentary.

III. CLIP Principles

1. Purpose, scope and structure

The structure of the CLIP Principles consists of a Preamble and 73 articles divided into four parts. Part 1 deals with the purpose and scope of the Principles. The remaining three parts are devoted to jurisdiction (part 2), applicable law (part 3) and recognition and enforcement (part 4).

The Preamble identifies the basic goals of the Principles: to reduce distortions and impediments to international trade and facilitate the cross-border flow of information and cultural exchange; to promote international judicial cooperation; and to improve the legal situation of plaintiffs and defendants involved in international litigation concerning intellectual property. It also stresses that the Principles are intended to provide legal certainty and predictability as basic elements to achieve the proposed goals. Moreover, the Preamble acknowledges as foundations of the Principles: a comprehensive interest analysis (→Interest and policy analysis in private international law), the territorial nature of intellectual property rights and →party autonomy in international situations.

The legal nature and possible uses of the Principles are made explicit in the introductory sentences to part 1 which are influenced by other international instruments containing model rules, in particular the UNIDROIT Principles (International Institute for the Unification of Private Law / Institut international pour l’unification du droit privé, UNIDROIT Principles of International Commercial Contracts 2010 (3rd edn, UNIDROIT 2010) (→UNIDROIT). The CLIP Principles are an instrument of soft law emanating from a private group that deals with a field of the law in which national systems and European and international instruments often lack proper special provisions that may result in increased uncertainty. It is noteworthy that the Principles are model provisions and recommendations addressed not only to legislators but also to judges in order to interpret or supplement international and domestic law, to arbitrators that may find guidance in general principles when resolving disputes, and to private parties that may consider them when shaping their contractual and extra-contractual dealings.

Because the Principles cover only conflict-of-laws issues, domestic situations are excluded from the scope of application. As stated in art 1:101 CLIP Principles the scope of the Principles is restricted to the private international law aspects of intellectual property (→Intellectual property, applicable law; →Intellectual property, jurisdiction). The Principles rely on a flexible and broad concept of intellectual property that encompasses p. 368copyrights, neighbouring rights, patents, marks, industrial design rights and similar exclusive rights. However, the notion is not broad enough to cover other forms of protection such as the protection of undisclosed information or geographical indications and unfair competition disputes (→Competition, unfair). Due to the close connection of the conflict-of-laws issues that may arise in these areas with those included within the scope of application of the CLIP Principles, art 1:101 envisages the possibility to apply mutatis mutandis the Principles to some disputes regarding undisclosed information, geographical indications and unfair competition allegations. By contrast, the ALI Principles cover unfair competition claims within their scope of application.

2. Jurisdiction

a) General jurisdiction and prorogation

Part 2 of the CLIP Principles starts with the provision on general jurisdiction or jurisdiction not limited to a specific subject (→Jurisdiction, foundations; →Intellectual property, jurisdiction). Under art 2:101 CLIP Principles general jurisdiction is granted to the courts of any state in which the defendant is habitually resident. The plaintiff has the option to choose between the courts having general jurisdiction and those having special jurisdiction in accordance with section 2 of part 2 (art 2:201–2:209), subject to the provisions on exclusive jurisdiction and prorogation. The courts of the defendant’s domicile (→Domicile, habitual residence and establishment) lack jurisdiction in disputes that fall within the exclusive jurisdiction of the courts of the state where the right has been registered (art 2:401) and also if the parties have agreed in a choice of court agreement that the courts of another state have (exclusive) jurisdiction (art 2:301). The CLIP Principles recognize the freedom of the parties to choose a forum for their disputes subject to the rules on exclusive jurisdiction and the specific jurisdictional rules of the forum protecting consumers and employees (art 2:603) (→Consumer contracts; →Employment contracts, jurisdiction). Although these provisions are in line with the model of the Brussels I Regulation (→Brussels I (Convention and Regulation)), differences can be identified. The Principles use the defendant’s ‘habitual residence’ instead of the ‘domicile’ to establish the general forum. More significant is that in comparison with the situation under the Brussels I Regulation, the restrictive approach of the CLIP Principles with regard to the scope of exclusive jurisdiction broadens the efficacy of prorogation agreements and the possibility to concentrate in the defendant’s habitual residence claims concerning intellectual property rights of countries other than the forum.

b) Exclusive jurisdiction

Exclusive grounds of jurisdiction restrict cross-border litigation concerning industrial property rights subject to registration because such rules exclude the possibility to bring certain claims before courts other than those of the state in which the registration has been applied for, has taken place or is deemed to have taken place. The CLIP Principles advocate in this area a strict understanding of the scope of exclusive jurisdiction. The starting point is similar to that of art 22(4) Brussels I Regulation, since art 2:401 CLIP Principles grants exclusive jurisdiction to the courts of the state of registration in disputes having as their object a judgment on the grant, registration, validity, abandonment or revocation of an industrial property right protected on the basis of registration. Moreover, exclusive jurisdiction is mandatory and any court seized of a claim falling within the scope of the exclusive jurisdiction of the courts of another state is obliged to declare that it has no jurisdiction (art 2:402).

However, the scope of art 22(4) Brussels I Regulation has traditionally been marked by controversy, especially its application to cases in which the issue of the validity of an industrial property right arises as an incidental question (→Incidental (preliminary) question) or as a defence. In its GAT judgment of 13 July 2006 (Case C-4/03 Gesellschaft für Antriebstechnik mbH & Co. KA (GAT) v Lamellen und Kupplungsbau Beteilgungs KG (LuK) [2006] ECR I-6509), the ECJ adopted an interpretation that broadened the scope of exclusive jurisdiction. In GAT the ECJ held that the exclusive jurisdiction should apply regardless of the form of proceedings in which the issue of a patent’s validity is raised, be it by way of an action or a plea in objection. By contrast, under the CLIP model exclusive jurisdiction does not apply to disputes where validity or registration arises in a context other than by principal claim or counterclaim (art 2:401(2) CLIP Principles). To ensure an appropriate balance, decisions p. 369resulting from disputes where validity or registration arises in a context other than by principal claim or counterclaim do not affect the validity or registration of those rights as against third parties (art 2:401(2)). This progressive approach is in line with the position adopted in § 211 ALI Intellectual Property Principles. More recently in its Solvay judgment of 12 July 2012 (Case C-616/10 Solvay SA v Honeywell Fluorine Products Europe BV, et al [2012] OJ C 287/7), the ECJ introduced some flexibility when considering that the exclusive jurisdiction granted under art 22(4) Brussels I Regulation is not applicable in certain proceedings seeking provisional relief on the basis of a foreign patent even if the defendants in the main proceedings argue by way of defence that the patent invoked is invalid.

c) Special jurisdiction: infringement, contracts and multiple defendants

The special jurisdiction provision regarding infringement claims in the CLIP Principles grants jurisdiction over such claims to the courts of the state where the alleged infringement occurs or may occur (art 2:202). However, in order to achieve a reasonable balance, in particular in connection with Internet activities (→Internet, jurisdiction), the provision excludes those situations in which the alleged infringer has not acted in that state to initiate or further the infringement and when the activity cannot reasonably be seen as having been directed at that state. Because only intellectual property rights of the forum can be infringed in the forum state, art 2:203(1) CLIP Principles limits the extent of jurisdiction resulting from this special ground of jurisdiction to infringements that occur, or could potentially occur, within the territory of the forum. This approach is in line with the traditional interpretation of art 5(3) Brussels I Regulation by the ECJ in its Shevill judgment of 7 March 1995 (Case C-68/93 Shevill v Presse Alliance SA [1995] ECR-I 415) and more recently in its Wintersteiger judgment of 19 April 2012 (Case C-523/10 Wintersteiger AG v Products 4U Sondermaschinenbau GmbH [2012] OJ C 165/5) (→Jurisdiction, contracts and torts). Later, in its Hejduk judgment of 22 January 2015 (Case C-441/13 Pez Hejduk v EnergieAgentur EU:C:2015:28) on copyright infringement the, ECJ held that Article 5(3) Brussels I Regulation does not require that the activity concerned be ‘directed to’ the Member State in which the court seized is situated, and that the occurrence of damage may arise from the accessibility of the content in the forum p. 370provided that the right whose infringement is alleged is protected in that Member State. With a view to limiting, in certain situations, the negative consequences of territorial fragmentation in the global context of the Internet, art 2:203(2) CLIP Principles allows a worldwide concentration of all infringement actions in one forum competent under art 2:202, provided that substantial activities in furtherance of the infringement in its entirety have been carried out within the territory of the forum, or the harm caused by the infringement in that state is substantial in relation to the infringement in its entirety.

With regard to contractual disputes art 2:201 CLIP Principles introduces a special jurisdiction ground based on the same approach as art 5(1)(a) Brussels I Regulation: a person may be sued in the courts of the state where the obligation in question is to be performed (→Place of performance). As a significant innovation art 2:201(2) provides a uniform definition of place of performance applicable to all contracts having as their main object the transfer or licence of an intellectual property right. For the purposes of this ground of jurisdiction the place of performance of such contracts is deemed to be the state for which the licence is granted or the right is transferred. However, when this provision offers the sole basis of jurisdiction, this provision grants jurisdiction only with respect to activities relating to the licence or transfer of the intellectual property right for the forum.

The provision on multiple defendants (→Multiple defendants and joint liability) of art 2:206 CLIP Principles was drafted with a view to facilitate cross-border adjudication of disputes and to prevent certain obstacles resulting from the interpretation of art 6(1) Brussels I Regulation by the ECJ, in particular, in its Roche Nederland judgment of 13 July 2006 (Case C-539/03 Roche Nederland BV, et al v Frederick Primus, Milton Goldenberg [2006] ECR I-6535) later supplemented with some flexibility by ECJ judgments of 1 December 2011, Painer, and 12 July 2012, Solvay. Article 2:206(2) CLIP Principles advocates for a progressive approach that facilitates the recourse to this forum. Article 2:206(2)(b) considers that the condition that disputes involve essentially the same legal situation may be satisfied even if different national laws are applicable to the claims against the different defendants, provided that the relevant national laws are harmonized to a significant degree by rules of a regional organization such as the EU or by international conventions.

d) Other issues

The CLIP Principles grant jurisdiction to adopt →provisional measures to the courts competent over the merits but also to the courts of a state where the measure is to be enforced, or for which protection is sought. Therefore, in comparison with the Brussels I Regulation the Principles clarify the connection required for a court to be competent to grant provisional measures but also provide an autonomous definition of provisional measures in art 2:501(3) CLIP Principles and lists examples of such measures.

The jurisdictional part of the CLIP Principles includes a section on ‘Coordination of proceedings’ intended mainly to reduce the negative consequences of situations in which the same or related disputes are being adjudicated before the courts of different states. The provisions on congruent proceedings (art 2:701) and related proceedings (art 2:701) give priority to proceedings in the court first seized and represent a significant progress with respect to the situation in most national systems (→Lis alibi pendens). Other provisions of this section establish mechanisms of cooperation between courts of different states. In particular, art 2:704 CLIP Principles refers to cooperation in multistate proceedings in situations where congruent or related proceedings are or have been pending in different states. In a comparative perspective, it can be noted that in the ALI Principles coordination between courts receives additional attention – including the possibility for courts seized with related claims to negotiate who is in the best position to adjudicate the case in its entirety; such an approach goes far beyond current practices of coordination between courts in international civil litigation.

3. Applicable law

a) Initial ownership

The law applicable to initial ownership remains especially controversial. This issue is subject to significant differences between national systems both on the substantive law level and regarding the conflict of laws. Even within the EU there are no uniform rules on the law applicable to initial ownership and differences remain between Member States. Although most states adopt an approach based on the application of the lex loci protectionis in line with the territorial nature of the rights others opt for the application of the lex originis. The ALI Principles also endorse the lex originis approach in this respect. Recourse to the lex originis seems to have the advantage of leading to the application of a single law favouring the same solution as to who owns the copyright in all countries. However, such an approach also raises significant difficulties with regard to its coordination with the territorial nature of such rights and because p. 371the determination of the country of origin can be particularly problematic.

Article 3:201 CLIP Principles opts for a territorial approach and also the application of the lex loci protectionis to initial ownership. To mitigate the problems resulting from the copyright being initially owned by different persons in different countries in particular in situations in which the work is created in the framework of an employment relationship or a service contract art 3:201(2) provides a rule of contract interpretation. According to this provision, if a situation has a close connection with another state that has a work made for hire provision or deems a transfer or exclusive licence of all economic rights in the work to have taken place by virtue of a contract, effect may be given to such rules by construing the parties’ relationship under the law of the country of protection as involving a transfer or exclusive licence of all economic rights in the work. Additionally, art 3:201(3) contains an exception to the application of the law of protection establishing that in the framework of a contract – such as an employment or a research and development contract – the law applicable to the contract will also govern the entitlement to claim the registered right.

b) Contracts

In the field of contracts the most significant contribution of the CLIP Principles may be found in its provision on the law applicable in the absence of choice (art 3:502 CLIP Principles). This is a particularly complex issue where high uncertainty remains even within the EU due to the lack of reference to these contracts in art 4 Rome I Regulation (→Rome Convention and Rome I Regulation (contractual obligations)) and because of the controversy concerning the determination of the characteristic performance and the closest connection in many of these contracts.

Article 3:502 CLIP Principles is based on the closest connection test. Under this provision contracts having the creation of protectable subject matter or the transfer or licence of intellectual property rights as their main object are deemed to be in the typical situations most closely connected to either the state of the habitual residence of the licensor or transferor or the state of the habitual residence of the licensee or transferee at the time of conclusion of the contract. Article 3:502(2) contains two lists of factors that should be considered by the courts when determining the country with the closest connection to the contract. The catalogue of factors tending to the law of the state in which the transferee or licensee has their habitual residence are: the contract concerns rights granted for the state of the transferee’s or licensee’s habitual residence; the transferee or licensee has the duty to exploit the right; the money consideration is expressed as a percentage of the sales price; and the licensee or transferee has a duty to report about his efforts to exploit the rights. The factors listed as tending to the law of the state in which the creator, transferor or licensor has their habitual residence are: the contract concerns rights granted for the state of the transferor’s or licensor’s habitual residence; the transferee or licensee has no other duty but to pay a flat sum as money consideration; the licence is for a single use; and the creator of the protectable subject matter has the duty to create that matter. Finally, if in the light of those factors no clear decision can be made as to the closest connection, art 3:502(2) establishes that for contracts concerning intellectual property rights for only one state, it shall be presumed that the contract is most closely connected with that country. If the transfer or licence concerns rights for multiple states, it is presumed that the state with which the contract is most closely connected shall be the state in which the creator, transferor or licensor has their habitual residence.

The law applicable to employment contracts (→Employment contracts, applicable law) is dealt with in art 3:503 CLIP Principles that is determinative with regard to the legal questions concerning a work created or an invention made pursuant to an employment relationship. The content of this provision is similar to art 8 Rome I Regulation. The law applicable to the contract is the law chosen by the parties, subject to the protection afforded to the employee by the state where he habitually carries out his work. In the absence of choice, the law of the state where the employee habitually carries out his work is applicable.

c) Infringement

According to art 3:601 CLIP Principles the basic rule is that the law applicable to the infringement is the law of each state for which protection is sought. This provision is in line with art 8(1) Rome II Regulation (→Rome II Regulation). However, the CLIP Principles contain a number of deviations from this rule in contrast with the situation under the Rome II Regulation. In this connection it is significant that art 3:606 allows for →party autonomy with respect to the law applicable to the remedies claimed for the infringement.

The provisions designed to cope with the challenges posed by the digital environment are of great importance to assess the potential impact of the CLIP Principles. Since the laws applicable to multinational infringements are those of each of the states for which protection is sought, concentration of infringement actions raises the significant procedural problem of ascertaining the national laws applicable. The lex loci protectionis rule leads usually to the distributive application of a plurality of laws with respect to activities performed through the Internet. The law of each protecting country is typically applicable insofar as the activity produces effects in its respective territory (mosaic approach) (→Intellectual property, applicable law).

First, an interpretative de minimis rule is introduced in art 3:602 CLIP Principles. It is not a choice-of-law provision but a rule of interpretation of the applicable substantive law to determine to what extent it is possible to establish infringement in multistate situations or infringements allegedly committed in many jurisdictions. According to art 3:602(2) a finding of infringement should be limited to states where the alleged infringer has acted to initiate or further the infringement and to states where the activity is directed to or where the activity causes substantial effect. A precedent of this approach may be found in the WIPO Joint Recommendation Concerning Provisions on the Protection of Marks, and Other Industrial Property Rights in Signs, on the Internet of 2001 (adopted by the Assembly of p. 372the Paris Union and the General Assembly of WIPO September 24 to October 3, 2001, WIPO Publication No 845, available at <www.wipo.int/edocs/pubdocs/en/marks/845/pub845.pdf>) (→WIPO and private international law).

The provision on ubiquitous infringement deserves particular attention. Article 3:603 CLIP Principles allows derogation of the general lex loci protectionis rule to replace the application of a multitude of laws by the law of closest connection. A special conflict-of-laws provision for ubiquitous infringement is based on the idea that although such infringements are multinational it is appropriate to single out one or several countries having the closest connection with the infringement in order to avoid the complexity resulting from the distributive application of the law of each country for which protection is claimed. Under the CLIP Principles the exceptional provision on ubiquitous infringement that allows derogation from the general lex loci protectionis rule has a much more restrictive scope of application than the similar provision contained in § 321 ALI Principles. The CLIP approach is related to the idea that even in the context of digital networks the lex protectionis remains a basic principle necessary to ensure that the territorial nature of intellectual property rights and its policy foundations are respected internationally. Additionally, although the ALI and CLIP Principles share a flexible recourse to the proximity principle as a method of simplification that may lead to the application of a single law to some situations, significant differences appear when comparing the factors used to determine the country with the closest connection in the two sets of Principles.

As an innovation, the CLIP Principles introduce a specific choice-of-law provision for secondary liability. Although art 3:604(1) CLIP Principles reaffirms the basic rule by establishing that ‘the law applicable to liability based upon acts or conduct that induce, contribute to or further an infringement is the same as the law applicable to that infringement’, under art 3:604(2) exceptionally one single law may be applied to certain types of secondary infringements. Only neutral and fully automated processes or services in which the provider exercises no control over the specific activities of the alleged direct infringer are covered by this exceptional provision. Additionally, art 3:604(3) establishes a unique minimum substantive standard. The single law determined in accordance with paragraph 2 is only applicable if it provides liability for failure to act in case of actual knowledge of a primary infringement or in case of a manifest infringement and liability for active inducement. The exceptional provision of paragraph 2 leading to the application of a single law does not cover claims relating to information on the identity and the activities of primary infringers.

d) Other issues

Among the other questions addressed in part 3 of the CLIP Principles, reference can be made, because of their novelty and increasing significance for financing, to the provisions on the law applicable to security rights in intellectual property. Article 3:802 CLIP Principles refers to the law applicable to the proprietary side of the transaction, while the mutual rights and obligations of the parties pursuant to the underlying agreement are covered by art 3:801. These provisions were drafted in close interaction with the discussions at →UNCITRAL regarding security rights in intellectual property.

4. Recognition and enforcement

Part 4 of the CLIP Principles contains a comprehensive and systematic regulation on →recognition and enforcement of judgments on intellectual property rights. Provisions in this field are decisive to obtain effective cross-border relief when litigating multistate infringements in the courts of a single country and in general against infringers who are not domiciled in the forum country. With a view to favour recognition and enforcement, part 4 does not allow certain grounds of non-recognition used in some systems, such as the verification of differences in applicable law or a →reciprocity requirement. Part 4 intends to enhance legal certainty by providing – in conjunction with part 2 – reasonable standards for the verification of the jurisdiction of the rendering court. Moreover, the CLIP Principles offer standards ensuring a restrictive application of →public policy and a reasonable verification of the notification of the proceedings.

IV. Future developments

The comparison between the parallel projects in this area pursued in the USA, EU and Asia shows that although significant differences may be found as to the style, basic concepts, language and structure of the principles, there is a p. 373high level of coincidence between the projects as regards the policy objectives and the solutions adopted. With a view to facilitate the consolidation of truly international standards that could be implemented by multilateral organizations, such as WIPO (→WIPO and private international law) or the Hague Conference, it seems appropriate to bring more uniformity within the different academic proposals in this field. That is one of the main goals of the special committee on ‘Intellectual Property and Private International Law’ that was created in November 2010 by the International Law Association.

Literature

  • American Law Institute, Intellectual Property: Principles Governing Jurisdiction, Choice of Law and Judgments in Transnational Disputes (ALI Publishers 2008);

  • Stefania Bariatti (ed), Litigating Intellectual Property Rights Disputes Cross-Border: EU Regulations, ALI Principles, CLIP Project (CEDAM 2010);

  • Jürgen Basedow, Toshiyuki Kono and Axel Metzger (eds), Intellectual Property in the Global Arena: Jurisdiction, Applicable Law, and Recognition of Judgments in Europe, Japan and the US (Mohr Siebeck 2012);

  • CLIP, ‘Exclusive Jurisdiction and Cross Border IP (Patent) Infringement: Suggestions for Amendment of the Brussels I Regulation’ [2007] EIPR 195;

  • CLIP, ‘Intellectual Property and the Reform of Private International Law: Sparks from a Difficult Relationship’ [2007] IIC 471;

  • CLIP, Conflict of Laws in Intellectual Property (OUP 2013);

  • Josef Drexl and Annette Kur (eds), Intellectual Property and Private International Law: Heading for the Future (Hart 2005);

  • Rochelle Dreyfuss, ‘The ALI Principles on Transnational Intellectual Property Disputes: Why Invite Conflicts?’ (2005) 30 Brooklyn J.Int’l L. 819;

  • Rochelle Dreyfuss and Jane Ginsburg, ‘Draft Convention on Jurisdiction and Recognition of Judgments in Intellectual Property Matters’ (2002) 77 Chi-Kent L.Rev. 1065;

  • James Fawcett and Paul Torremans, Intellectual Property and Private International Law (2nd edn, OUP 2011);

  • Toshiyuki Kono (ed), Intellectual Property and Private International Law: Comparative Perspectives (Hart 2012); Annette Kur, ‘International Hague Convention on Jurisdiction and Foreign Judgments: A Way Forward for IP?’ [2002] EIPR 175;

  • Annette Kur, ‘Applicable Law: An Alternative Proposal for International Regulation – The Max Planck Project on International Jurisdiction and Choice of Law’ (2005) 30 Brooklyn J.Int’l L. 951;

  • Stefan Leible and Ansgar Ohly (eds), Intellectual Property and Private International Law (Mohr Siebeck 2009);

  • Rita Matulionytė, Law Applicable to Copyright: A Comparison to the ALI and CLIP Proposals (Edward Elgar 2011);

  • Private International Law Association of Korea and Japan, ‘Private International Law on Intellectual Property Rights’ [2011] The Quarterly Review of Corporation Law and Society 112; Special Issue on Private International Law and Intellectual Property in [2012] JIPITEC, 173 et seq.