Concerning intellectual property rights and the right of parallel imports exhaustion: China's choice
Limit parallel imports and support the exhaustion of rights theory is contemporary international trade law and intellectual property is one of the problems of fierce debate. The interests of all countries according to their different starting point to a different strategy and position. The wto's "the intellectual property rights and trade agreement (TRIPSAgreement) no clear-cut and unified principle, but for various countries with different position provides room for play. In the current world trade legal framework, it is argued, the limit of parallel import a party and ideas right in the theory of exhaustion party can find the need of legal basis. In a certain extent, the existing international rules, including the trade agreement with the intellectual property rights "and special knowledge property rights treaty, are to be the two questions to countries or regions to deal with. So, how should China according to the existing the wto rules and other treaties deal with this problem? This is to be discussed in this paper.
A parallel import restrictions and legal basis
Parallel imports generally refers to a separate importers, to sell or profit for the purpose, from a foreign area to buy in the area of legal for the product, and who will buy products imported to another area behavior. Such purchase and import the main motives and behavior reason is the same products in one region of the price difference between sales. The same products in different regions of the sales price difference in parallel to the importer to provide basic profits, and the import of the region to provide more affordable consumer spending choices. The public interest, that is, product market prices for consumers and the rationality of the fair and reasonable protection is intellectual property law shall consider the question. Prevent intellectual property owner or authorized person is not reasonable to corner the market, price controls in effective and reasonable to promote social productivity development and protection of the interests of consumers, it is in the world recognized as one of the principle of intellectual property law. Moreover, parallel imports concept with free trade principle, namely the goods and services products shall, in countries or between economies freely. So, parallel imports concept not only by many developing countries to accept or default, and also for some developed countries in part to accept. For example, the Swedish government in drug protection to the exhaustion of the world right principle that allows parallel imports has in any country in the world of legitimate sales of drugs. This approach is called the "international consumer" principle. Obvious and protect the interests of consumers about.
Parallel imports behavior mainly involves two legal questions: first, the product of intellectual property all agree and authorized the export and import behavior; Second, parallel imports to be imported products infringement in a particular regions have a unique and the interests of the people JinKouQuan monopolies. In a particular area import and sales of the product is a product of intellectual property rights of all outspread. So, two legal problems can actually be a, namely constitution on intellectual rights all exclusive rights and the violation of monopoly. And intellectual property rights to the product of all people, especially the patent holder and the copyright owner of the exclusive right of protection, is the basic theories of parallel import restrictions.
Because all of intellectual property rights are restricted parallel imports of legal theory, many common law countries court by study and analysis for a product in a particular area is authorized to manufacture and sales of specific conditions, to determine whether or not a infringe intellectual property rights of all right. In Britain, the limit of parallel import rules most is through the case law way to create. British court for the first time in allow the holder of the manufacturing and sales by its intellectual property rights protection products, made it clear that any unauthorized limit sales and use behavior. Such restrictions to be explained, is to the unauthorized export and import restrictions. If the importer to know this limitation parallel existence, and continue to be engaged in parallel imports of words, he will be regarded as infringing the original of the holder of the interest. At the same time, the court also through the analysis of the JinKouQuan enjoy a unique authorized by the holder of the right and the between the assignment contract, determine whether the parallel imports violated a certain regions have a unique JinKouQuan people's interests and rights. In Australia case: AvelPtyLtdvMulticoinA musementsPtyLtd case, the Supreme Court ruled that Australia authorized import a certain us WanJuShang enjoy exclusive products of Australia authorized person, has no right to limit Australia another importers from the United States imports to buy peace did Australia used toys. This conclusion is the main reason, licensor and the copyright owner of the right transfer signed contract includes only the copyright owner of the Australian market specifically for the manufacture of the products, not including the American market for manufacturing, second-hand goods to the sale of toys. This shows, even in the limit of parallel import country, restrictions also not be misused.
Think parallel imports of intellectual property infringement countries generally by legislative ways banned parallel imports. For example, Australia's "copyright" method stipulated in article 37: if someone without permission from the copyright owner, and in order to sell, lease, tried to sell or rent for the purpose, or in the trade or violate copyright person interest for import any works is a purpose of the literature, drama, music, or art in copyright infringement. The scope of application of this clause is very wide. The key lies in whether the import get the permission of the copyright owner. The general parallel imports are without the permission of the intellectual property right owner behavior. So, this clause forbids to protected by copyright works of parallel imports. But, front mention AvelPtyLtdvMulticoinAmusementsPtyLtd case shows that even the limit of parallel imports, Australian court also is met with case analysis confirm a parallel imports behavior are the copyright owner get permission, or a related JinKouQuan exclusive contract if it's really limit to a particular parallel imports behavior. In AvelPtyLtdvMulticoinAmusementsPtyLtd case, the high court judge that most American copyright (that is, the toy manufacturer) no limit of parallel import in secondhand toys will. This will related rights transfer contract is (copyright owners and import license contract between) and the copyright owner and parallel imports of communication between people determine content. In other words, the court by comparing the plaintiff (authorized import new toys imported) and the U.S. toy manufacturers of between contract and to compare the defendant (engaged in the import, second-hand toys or deemed to be engaged in of parallel import party) and the U.S. toy manufacturer of communication between the decision, the United States toy manufacturers in and the plaintiff to sign the contract without limit others to Australia's imported second-hand toys will.
Comprehensive discussed above, can think of parallel imports are generally believed to all of the intellectual property rights violations and people would be banned. But, banned at the same time must also think free trade, goods and products circulate the principles of liberty, should also consider the interests of the consumer and the exclusive right of the holder of the exercise of a specific market and economic impact. In September 2001, the United States and Brazil reached a consensus. The United States agreed to some kind of special drug, for example, on a cure for AIDS drugs and spread the disease, use agile attitude, acknowledged that Brazil in the law the parallel imports and compulsory license applicable necessary, but not questioned whether such rules with the wto agreements. This concession is part of Brazil and South American countries domestic market demand and the economic reality admitted, also reflects the parallel import restrictions to consider the factors. In November 2001 the world trade organization doha conference on the eve of the upcoming conference, South Africa the newspapers reported the United States is ready to give up on the part of the poor countries selectively shall be investigated for drug patent infringement litigation. The United States to Brazil and part of the poor countries to give up the practice of medicine for infringement, is to avoid the doha conference in Brazil and South Africa, poor countries want to discuss pharmaceutical parallel imports and a compulsory license to use a special case of the problem, and avoid the requirements by other wto members support awkward situation. The practice of the United States from certain angles reflects parallel imports and rights of the complexity of the debate and debate the exhaustion of the conflict of interest.
In parallel import restrictions, foreign court most of the time the contract and the parties through the analysis will say, to determine whether it shall be restricted or allow a particular "parallel imports" behavior. The discussion above case proved this conclusion. Japanese court in July 1997 in the case of the decision to BBS, has taken a similar approach allows parallel imports have at the same time in Germany and Japan, but a patent protection in Germany the wheel of manufacturing. In this case, the Supreme Court found that in Japan and Germany sellers of parallel the sale and purchase of goods, no it is not allowed to be imported products to Japan market restrictions. At the same time, even if this limitation really exist in other words of files, Japan's parallel importers also don't know the existence of this limitation. Parallel importers in terms of "international exhaustion" theory support his import behavior. Japanese court without clear to "international exhaustion" principle comment, but think that when the patent holder on the market sell patent product, the right holder is free to use and resale rights transfer together to the buyer. The court said that the transfer of such rights is the expectation of the international trade rules. Japan's Supreme Court ruled that, only when the patent holder to sell products in the explicit ban products into the Japanese market, parallel imports from this limit the constraints of the talents. Moreover, the court said that when parallel imports have made the product sells to the third person, the third person only in know in advance of the presence of such restrictions, such restrictions to be the constraint. In other words, if parallel imports illegal to import products sold to a third person, the goodwill of the interests of a third person would be protected. And as the Australian case discussion, compared AvelPtyLtdvMulticoinAmusementsPtyLtd, different is, in Australia, the court said the cases in the United States and Australia's unique JinKouQuan copyright between whether contract terms can limit parallel imports about second-hand products; But in Japan in the case, the court emphasize parallel imports and foreign patent whether a limit order between parallel imports to the terms of the problem. Two of the case is the same, the court is to explain the contract terms by content to determine whether the way parallel imports legal problems. Japanese courts take the reasoning of the way with a controversial shall be parallel imports (wheel) and at the same time by Germany and Japan patent protection on the facts. In the case of Japan, expect import restrictions one party is Japan patent holders, and not JinKouQuan enjoy unique.
Also it must be pointed out that international trade can appear sometimes by all of the intellectual property allowed "parallel imports" problem, namely foreign intellectual property all allow parallel imports, and such parallel imports harm a certain unique JinKouQuan the interests of the people. This kind of parallel imports is not the general sense of the parallel imports, but is only relative to the interests of the people enjoy exclusive JinKouQuan "parallel import". In such cases, enjoy the so-called exclusive JinKouQuan one party, which is not mutually exclusive of parallel imports products JinKouQuan. If he thought that his interests infringed words, he can only prosecution of the intellectual property violation of all people between their right transfer the terms of the contract.
Second, the reason for the exhaustion of claims
The exhaustion of intellectual property rights is one of the basic concept. The holder of the intellectual property law, protect the exclusive rights and exclusive rights. The right to use, from manufacturing, sales, to import and export and to rental is everywhere. But any rights must also have certain scope and duration. Rights holder of exhaustion principle is as the reasonable principle limit right there. Generally speaking, the exhaustion of the right holder of the principle is said that when a particular region authorized production, sale and use of intellectual property protection after a product, the right holder of the product in this particular region is sort of right has been "exhaustion", that is exhausted. The right to the protection of exhaustion doctrine normal economic order, protection during the transfer process of the interests of all parties and protect the legitimate interests of the consumers is very important. Developing countries more welcome the exhaustion of the extensive use of the right principle, because this principle can make these national consumer and users get cheap products. For example, in 1997, the South African government amended "drug and related products of aliens, allow parallel imports drugs and through the" compulsory license "means a forced production need drugs, in order to make the poor and AIDS patients were able to afford drug. Foreign companies in South Africa court questioned the legality of the law, but in April 2001 when court decided to withdraw. The spread of AIDS by South Africa caused the disaster, is forcing foreign companies accept parallel imports and compulsory licensing pharmaceutical production necessary moral and practical reasons. Consider to their economic and political reasons, rich countries are common, but there are conditions to accept the exhaustion of the right principle, that is, the application of the principle of the make various restrictions. For example, the European Union rules, within the European Union in sales of products applicable right principle of exhaustion.
In the common law countries, the holder of the reserves have clear unless, the holder of the first sale allowed when a product, he for this product in a particular country or region right namely "the exhaustion". But it must be pointed out that common law countries court of the "right" no unified recognition range. Be the exhaustion is part of the right, but not all be regarded as "rights" content. Developed countries such as Germany, France, etc, also in the 1980 Helsinki copyright meeting, just agree on parts of the right of exhaustion. In Britain, the patent holder has the right to agree with the first sales in patent products, to further set up sales and use restrictions. Such restrictions are generally will be the execution. But, if the user and sellers after to prove they did not know, or they may not know the presence of constraints, the court may refuse to carry out originally established constraints.
Generally speaking, in certain first sold by a intellectual property protection products or works, the products and the circulation work will no longer restricted. According to the current eu law, a work in the European Union or products for the first time after sales, the work and the product can free circulation, the right holder namely lose in the eu limit the scope of the right to use the circulation,. In the case of ParfumsChristianDiorvEvora, a supermarket in the European Union without authorization purchase of the Dior brand perfume, and ads with other ordinary trademark perfume sold together. Dior trademark all think that such ads have lower Dior brand perfume behavior class too, want to through the court banned the supermarket advertising. The eu court think unless all people can prove trademark supermarket behavior the product credit damage, or the supermarket sales have for trademark infringement of all the trademark rights. So, the court said that the plaintiff has no right to limit the accused of product advertising and sales action. In another case, BMW manufacturers think through the court in a limit to sell BMW used parts and repair second-hand car XiuLiShang use of BMW BMW logo. The European court in accordance with the principle that the exhaustion of rights, the manufacturer shall have the right to limit XiuLiShang use BMW logo. The court said that the XiuLiShang declare that he engaged in BMW car maintenance, and no claims to be the WeiXiuShang authorized specialized BMW. The court's opinion is, unless XiuLiShang by the manufacturer of the XiuLiShang pretend to be authorized, manufacturers have no right to interfere with XiuLiShang use BMW signs to show that its business and BMW car relevant. Such reasoning is the right way to the exhaustion of the theory of recognition.
Even if admitted the exhaustion of the holder of the right to the principle and lose the right products limited circulation, the right holder still retain many other rights. Meanwhile, in the European Union within the scope of the right is not equal to the exhaustion from the eu to other countries outside areas used parallel imports without authorization by the way the import protection products. In this case, the eu members have the right to use their own legal limit outside input from the eu parallel import products. Also, the exhaustion of rights is not equal to the people have the right to import any change of the original trademark. In the European Union range, replace the trademark and repacking and after the replacement of the trademark act, are generally believed to the original trademark rights infringement. Ought to point out, the eu, the court also allow in special circumstances, the manufacturer or authorized persons according to different market need, and replace the same product trademark legitimacy. But, generally think such exceptions range is not clear, when use often cause controversy.
To sum up, the right principle of exhaustion has its positive role and status. It is to the right holder of the exclusive right of a reasonable restrictions, stable business order and protection of the interests of consumers have positive effect, there are limits on the holder of the means of unfair competition monopoly the role of the market. But, right principle must by law and the exhaustion of encouraging and protecting the exclusive right of the holder of the monopoly, to maintain a reasonable balance. In order to carry out the protection of the right holder, the exhaustion of the scope of the right principle must be limited. So, most developed countries in the legal right to admit the exhaustion after principle, and the right to limit the exhaustion of the application of the principle. This practice has become the modern world legislation trend. For example, the international rights for Austria exhaustion principle, namely whether foreign sales or domestic sales, right at the first sales exhaustion after. According to the European Union in the European Union about right for the first time after the principle of sales exhaustion, Austrian law was for amendment. Also, the European Union to product packaging and to court to change the behavior of the new trademark limit, also forms the exhaustion of the applicable to the right principle limit. But, for the exhaustion of the consequences of limited right principle is the developed countries benefit considerably more than the developing countries to benefit. So, many developing nations don't support to the right more than the exhaustion of the limits of the principle.
Three, the tri agreement cause controversy
The trade agreement with the intellectual property rights of parallel imports and opposition is support parallel imports, is also support the use of rights and opposed to the use of the exhaustion of the exhaustion of the right principle two view of compromise. The compromise in the trade with the intellectual property rights agreement article 6 and 11, 26, 28, and 36.
"The intellectual property rights and trade agreement, the provisions of article 6: in order for the purpose of solving disputes, in addition to the relevant provisions of article 3 and 4, outside of this agreement other terms the rights and exhaustion doctrine have nothing to do. This clause show that disputes, in addition to debate whether the parties had carried out article 3 of the national treatment principle and article 4 of the most-favoured-nation treatment principle, the trade agreement with the intellectual property rights of any terms do not constitute the rights of the principle of how to treat the exhaustion of foundation. It must be pointed out that national treatment and the most-favoured-nation treatment are and whether they should apply the principle of exhaustion not right or no direct relation. The two principles at most wto members in the applicable requirements or not apply equally to the exhaustion of rights principles, not right on the principle of the legitimacy of exhaustion. So, article 6 become part of the wto members insist the principle for the exhaustion of the legalization of right main legal basis.
On the other hand, "trade related intellectual property" agreement, 26, 11 28 and article 36 gifted to the holder of the intellectual property right of the right to the exclusive rights. The exclusive right to the exclusive extending to unauthorized import and parallel import restrictions. Part of the clause to make clear a regulation, without the right holder agree, shall not be imported, sales and use by the intellectual property protection products. Such items is a part of the wto members, especially the developed country members insist that parallel import in violation of the basis of the wto rules. So, the current world trade rules seem contradictory, or pregnant with the potential contradictions.
To stop in October 2001, the wto dispute settlement mechanism of experts group has completed the program of 53 case report. No one is about parallel imports and rights of the principle of exhaustion. "The intellectual property rights and the trade agreement between the terms of potential not coordination, are the wto members will dispute submitted to the wto expert group processing of obstacles. According to the general principles of the treaty accept explanation, the author thinks that, the panel of experts is likely to right concept is different from the exhaustion of unauthorized import restrictions based upon the concepts, demonstrates the consistency of the relevant principles, and only the relevant intellectual property rights and trade agreement expressly limits behavior concluded. In fact, the trade agreement with the intellectual property rights of article 6 that most of the agreement only terms not be used as a support and restricted rights the theoretical basis of the principles of exhaustion. But, this clause does not explain what is the "right of exhaustion", no "right of exhaustion" peace do import equals or together. Also, about the terms of the exclusive rights to protect the owners have limited unauthorized import role, but not directly or indirectly, to show that the "right of exhaustion" principle is also for effective and legal principle. Special should be noted that copyright and trademark protection character, "the intellectual property rights and trade agreement does not expressly limits unauthorized imports. These terms and conditions show that the trade related intellectual property agreement limit some cases of parallel imports, but for some cases of parallel imports on the fence. So, the expert group probably find that without the authorization of the intellectual property rights of all, the protection of patent, industrial design and integrated circuit product "parallel imports" is a violation of the wto rules. And for protected by copyright and trademark protection works parallel imports products that opinion. To the trade related intellectual property agreement just literally explain, can maintain the consistency of the agreement. But, to a different intellectual property rights of the different protection suggest that different countries and economies to the right of the principle of the exhaustion of different understanding.
Four, China's choice
China's theoretical circles on the parallel imports know no unified. Think parallel into shall allow point of view to notice more consumer interests and consumer products to the protection of the option of free trade and the circulation of commodities protection of freedom. And think parallel imports illegal view it emphasizes the important protection of intellectual property rights, protect the interests of the right holder unique licensing rationality (for example, the right holder cost money and energy development of domestic market), and protect the quality of products of the necessary to wait for a reason. As China has become a member of the wto fact, most of the ideas that China should have restrictions on parallel imports. However, the government in the legislation must be considered when parallel import restrictions on China's economy and industrial the full effect. South American and African countries need for emergency medicine parallel imports and forced open for the workmanship of the permit, shall be China's legislature considered. Of course should also be admitted that China's status as a member of the wto, and many of the most poor countries different. China's development of China in the wto can reasonable and legitimate in the policies of the influence, is also the problem of must study.
Mainland China in December 2001 to join the world trade organization. The trade agreement with the intellectual property rights of China has to take effect. Before this, China has modified the patent law, the copyright law and the trademark law. Modification of the law is and the trade agreement with the intellectual property rights of the relevant rules consistent is the concern about.
The patent law clearly stipulated in article 11 of the patentee, may not sell and import patent products. This position and the related intellectual property rights and trade agreement in article 28 principle, has limitations of parallel import role. The patent law article 63 allows the manufacture, import or the patent holder licensing and manufacture, import products after use, offer to sell the sales and marketing. This clause in the Chinese range admit right principle of exhaustion, but will not extend to the exhaustion of the right principle of parallel imports.
"The intellectual property rights and trade agreement not expressly limits sales, use, and import protected by copyright works of terms. But, article 11 introduced "rent right" concept. This concept banned unauthorized rent protected by copyright works, it is a kind of rights to exhaustion doctrine restrictions. The copyright law has on October 27, 2001 published modification. Modification of the provisions of article 10 rent right is one of the copyright owner of the right, and protected. But, the copyright law in terms of parallel import no limits. Because the trade related intellectual property agreement didn't ask the wto members limit unauthorized use, sale and import protected by copyright works, China's copyright law does not violate wto rules. Copyright protection look, China still continue the rights of the generalized principles of exhaustion. In contrast, front mention of Australian case, AvelPtyLtdvMulticoinAmusementsPtyLtd, if there's a word in mainland China, not cause to the copyright law breach, but by other legal jurisdiction over whether, when when. By December 2001 check, China still nothing about parallel imports protected by copyright works cases reported./
"The intellectual property rights and trade agreement and no clear restrictions registered trademark protection products by the parallel imports. On October 27, 2001 modification of the trademark law, no specific provisions of parallel imports. But, it must be pointed out that the trademark law article 52, the first (4) of the specified: without a trademark registrant agree, and change its registered trademark and will replace trademark products sell behavior is after a tort. As mentioned in the discussion, the European Union will replace trademark and sell after the behavior of the product change as a "right of exhaustion" problem seriously. So, from now on sense, modification of the trademark law, the right of the practice of limit exhaustion. This limitation is not as directly with the trade and the intellectual property rights agreement on rules, but by the European Union practice influence. Moreover, the changes of the past is like Chinese judicial practice process this problem which different views of the argument a summary.
It is worth mentioning is that, in the trademark law before the change, China has a limit on the trademark protection products in the case of parallel imports. Guangzhou intermediate court in November of 1999, the ruling, Shanghai company company appeals to guangzhou economic and technology development zone in commodities import trade company case (hereinafter referred to as LUX case) involving LUX (has) brand of soap parallel imports. In June 1999, guangzhou the customs to detain the guangzhou economic and technology development zone in import and export company imported from Thailand LUX brand soaps 895 cases. The plaintiff Shanghai company and company in guangzhou intermediate court to attack the plaintiff an exclusive license on the right, sued the defendant import and export company. The court of an exclusive license to use extending to of parallel import restrictions, ruling the defendant to compensate the defendant about hk $80000 loss. The case is seen as China's first a limit of trademark protection products of parallel import case. At the same time, also for China to limit trademark protection products provide a precedent parallel imports. But, must be admitted that, after the modification of the trademark law of parallel import restrictions only an indirect regulations. Article 3 the trademark law, protect the trademark registrant to exclusive use of trademarks. Article 52 of the trademark law, paragraph 5 of banned "to others the exclusive use of a registered trademark cause other damage" behavior. According to the case of reasoning LUX, such provisions can be banned the basis of parallel imports. But, it must be pointed out that the full story LUX case in the ninety s and a lot of products to LUX smuggling, and this leads to loss of state tax has relationship. The court will be the same whether to logic applies to other trademark protection products of parallel imports is yet to be observed.
According to the current intellectual property law three main see, China to exhaustion and parallel import rights to the problems with the trade and the intellectual property rights agreement similar compromise position. Only the patent law expressly limits to is protected by patent product of parallel imports. The copyright law on the fence on this question. The advantages and disadvantages of this position must, in accordance with China's national conditions and the necessity to measure economic interests. Too wide and strict intellectual property protection will cause many terms to the Chinese enterprise development restrictions. China should also must accept accord with international standard rules and practice, but not necessary to the higher than normal standard rules. So, China's current position has certain rationality and practical. China's current position, especially the copyright law to the right attitude is in accordance with the principle of the exhaustion of China's economic development and the needs of the development of foreign trade, it must be the practice can prove by later.