CJEC, July 3, 1974, No 192-73

THE COURT,

1. By judgment dated 31 October 1973, lodged at the registry on 28 December 1973, the Tribunal d'Arrondissement of Luxembourg has referred to the Court, under Article 177 of the EEC Treaty, two questions for a preliminary ruling, on the interpretation of Articles 5, 30, 36 and 85 of the Treaty, in relation to trade mark law.

2. The first question asks whether the Community rules on competition or those relating to the free movement of goods prohibit the holder of a trade mark enjoying legal protection in a Member State from opposing the importation of products that legally bear 'the same trade mark' in another Member State, where at the outset the two marks belonged to the same holder.

3. The file shows that the original holder, carrying on business in Germany, had assigned his trade mark as regards Belgium to a subsidiary established and controlled by him, but which became independent as a result of an act by a public authority.

4. As it is expressed in the question, there exists between the two present holders 'no legal, financial, technical or economic link '.

5. Article 85 not being in these circumstances applicable, the question must be examined by reference only to the rules relating to the free movement of goods.

6. As a result of the provisions in the Treaty relating to the free movement of goods and in particular of Article 30, quantitative restrictions on imports and all measures having equivalent effect are prohibited between Member States.

7. By Article 36 these provisions shall nevertheless not preclude prohibitions or restrictions on imports justified on grounds of the protection of industrial or commercial property.

8. Nevertheless, it is shown by this very Article, in particular its second sentence, as well as by the context, that whilst the Treaty does not affect the existence of rights recognized by the legislation of a Member State in matters of industrial and commercial property, yet the exercise of these rights may nevertheless, depending on the circumstances, be affected by the prohibitions in the Treaty.

9. Inasmuch as it provides an exception to one of the fundamental principles of the common market, Article 36 in fact only admits derogations from the free movement of goods to the extent that such derogations are justified for the purpose of safeguarding rights that constitute the specific subject matter of this property.

10. Thus the application of the legislation relating to the protection of trade marks at any rate protects the legitimate holder of the trade mark against infringement on the part of persons who lack any legal title.

11. The exercise of a trade mark right tends to contribute to the partitioning off of the markets and thus to affect the free movement of goods between Member States, all the more so since - unlike other rights of industrial and commercial property - it is not subject to limitations in point of time.

12. Accordingly, one cannot allow the holder of a trade mark to rely upon the exclusiveness of a trade mark right - which may be the consequence of the territorial limitation of national legislations - with a view to prohibiting the marketing in a Member State of goods legally produced in another Member State under an identical trade mark having the same origin.

13. Such a prohibition, which would legitimize the isolation of national markets, would collide with one of the essential objects of the Treaty, which is to unite national markets in a single market.

14. Whilst in such a market the indication of origin of a product covered by a trade mark is useful, information to consumers on this point may be ensured by means other than such as would affect the free movement of goods.

15. Accordingly, to prohibit the marketing in a Member State of a product legally bearing a trade mark in another Member State, for the sole reason that an identical trade mark having the same origin exists in the first State, is incompatible with the provisions providing for free movement of goods within the common market.

16. The second question asks whether the same would be the case if the marketing of the product covered by the trade mark were effected not by the holder of the trade mark in the other Member State but by a third party, who has duly acquired the product in that State.

17. If the holder of a trade mark in one Member State may himself market the product covered by the trade mark in another Member State, then this also applies to a third party who has duly acquired this product in the first State.

18. The costs incurred by the government of the united kingdom and by the Commission of the European Communities, which have submitted observations to the Court, are not recoverable, and as these proceedings are, in so far as the parties to the main action are concerned, a step in the action pending before the national Court, costs are a matter for that Court.

On those grounds,

THE COURT,

In answer to the questions referred to it by the Tribunal d'Arrondissement of Luxembourg by judgment of that Court dated 31 October 1973, hereby rules:

1. To prohibit the marketing in one Member State of a product legally bearing a trade mark in another Member State for the sole reason that an identical trade mark, having the same origin, exists in the first State, is incompatible with the provisions for the free movement of goods within the common market.

2. If the holder of a trade mark in a Member State may himself market the product bearing that trade mark in another Member State, then the same applies to a third party who has duly acquired this product in the first-named State.