CJEC, November 6, 1984, No 177-83

THE COURT

1 By an order of 11 august 1983, which was received at the court on 16 august 1983, the landgericht München i (regional court, munich i) referred to the court of justice for a preliminary ruling under article 177 of the eec treaty a question on the interpretation of article 30 of the treaty, so as to enable it to reach a decision on the compatibility with that article of a provision of german law regarding unfair competition.

2 Paragraph 3 of the german law on unfair competition (gesetz gegen den unlauteren wettbewerb) prohibits ' ' misleading statements regarding... The origin... Of specific goods... Or their source... ' '. Whosoever makes such statements in the conduct of business for purposes of competition may be sued for an injunction restraining him from making such statements.

3 That provision was relied on by an undertaking specializing in the manufacture and installation of pharmaceutical equipment, theodor Kohl kg, of regensburg in the federal republic of Germany, in an action to restrain a french undertaking which distributes on the german market the same equipment as itself from using a distinctive symbol formerly used by a group of undertakings controlled by the german company ringelhan & rennett.

4 The french company Ringelhan & Rennett SA of Annecy, France, was founded in 1971 as a subsidiary of the german company ringelhan & rennett. The group thus formed used the symbol ' ' r + r ' ', in white letters on a contrasting background, to distinguish the undertakings belonging to the group. After the insolvency and liquidation of the german company Ringelhan & Rennett in 1982, the french company, which had in the meantime been sold to a third party, continued to use the distinctive symbol, having been authorized to do so by the liquidator of the german company. For the distribution of the equipment in question on the german market the french company used its new representative in the federal republic of Germany, the german company Ringelhan Einrichtungs GmbH, of oberhausen.

5 The gravamen of Kohl ' s complaint is that Ringelhan & Rennett SA (the french company) and Ringelhan Einrichtungs GmbH (the new german company) refer in their business correspondence and advertisements on the german market to the ' ' r + r ' ' symbol without indicating that there is no longer any legal or economic connection with the old Ringelhan & Rennett company, which formerly had a considerable reputation in the sector in question. Thus, according to Kohl, the two existing ringelhan companies have misled the german public.

6 Kohl ' s contention was upheld in interlocutory proceedings before the german courts on the ground that the advertising of the two existing ringelhan companies could, in the absence of any indication that there was no connection with the old german company, give the impression that the goods came from the old campany and not from a foreign undertaking. Interlocutory injunctions were granted prohibiting the two companies from using the distinctive symbol.

7 The case before the landgericht München i, which took the view that the use of the distinctive symbol in the federal republic of Germany by the french firm was prohibited by german competition law even though the symbol was lawfully used in France, since the relevant business sector in Germany might regard the symbol as a reference to the defunct german undertaking or, in any event, to the group of undertakings, which had also ceased to exist, and that such use might therefore be misleading, contrary to article 3 of the law on unfair competition.

8 The national court therefore referred to the court of justice for a preliminary ruling the questions whether under community law, in particular article 30 of the eec treaty, it is permissible to prohibit the french undertaking from using the distinctive symbol in question on german territory, and whether the degree to which such use is misleading has any relevance.

9 The purpose of those questions is to establish whether a member state ' s legislation on unfair competition must be regarded as a measure equivalent in effect to a quantitative restriction within the meaning of article 30 of the treaty if it makes it possible to prohibit the use, by an undertaking established in another member state, of a distinctive symbol lawfully used in that other member state, on the sole ground that the symbol was formerly used by a group of undertakings to which it belonged, in common with an undertaking established in the first member state which has since been wound up, and that the symbol might therefore be regarded by the public as a reference to the defunct undertaking or group.

10 It should first be pointed out that in this case the undertaking seeking to restrain the use in the federal republic of Germany of the distinctive symbol in question does not rely on the fact that it is itself the proprietor of a similar distinctive symbol or of another industrial property right, such as a trade mark, and that the use of the symbol in question by the french undertaking might interfere with those rights or cause confusion in the mind of the german public between its own products and those of the french undertaking. It simply argues that the use of the symbol in question is misleading on the sole ground that it might be regarded by the german public as a reference to another german undertaking which has since been wound up.

11 Thus the question raised concerns the compatibility with the treaty of a legal provision in one member state making it possible to prohibit the use of a distinctive symbol by an undertaking established in another member state where its use is lawful in that other member state and was also lawful in the first member state until the dissolution of the group which associated the undertaking in question with a company established in the first member state.

12 Theodor Kohl kg, the plaintiff in the main proceedings, and the government of the federal republic of Germany pointed out in that regard that the court has held in previous judgments that, in the absence of common rules, obstacles to intra-community trade resulting from disparities between national legislation must be accepted in so far as such legislation, being applicable to domestic products and imported products without distinction, is necessary in order to satisfy imperative requirements relating inter alia to consumer protection and fair trading.

13 According to the ringelhan companies, the defendants in the main proceedings, the government of the french republic and the commission, that principle does not apply to a case such as this, where the obstacle to trade created by the application of national legislation is a result of the liquidation of a german company and the dissolution of the group composed of it and a french undertaking. It is contended that such circumstances cannot have the result of allowing a competitor on the german market to invoke consumer protection where he could not do so before the dissolution of the group.

14 It must first be considered whether national legislation of the type concerned in this case may be regarded, from the point of view of its effect on trade between member states, as being applicable without distinction to domestic and imported products. That is in fact a precondition for the application of the principle laid down in the judgments cited by Kohl and by the german government, as the court explained in particular in its judgment of 17 june 1981 (case 113-80, commission v ireland, (1981) ecr 1625).

15 The facts established by the national court and set out in its order show that that condition is not fulfilled in a case such as the present. Even though a provision of national legislation on unfair competition applies without distinction to the marketing of domestic and imported goods, it cannot fulfil the condition referred to above if it is interpreted in such a way that it becomes possible to prohibit the use of a distinctive symbol for the sole reason that the public may be misled as to the domestic or foreign origin of the goods, without its being necessary to adduce evidence of other specific factors establishing the existence of unfair competition. In such a case, the provision in question in fact applies only to the marketing of imported products.

16 To the extent to which it makes it possible to impose such a prohibition, a provision of national law cannot be regarded as legislation applying in a uniform manner to the marketing of domestic products and imported products.

17 Such a provision makes it possible to erect barriers within the common market, amounting to a restriction on intra-community trade prohibited by article 30 of the treaty.

18 The german government further argued that even if the provision of national law in question was contrary to article 30 it could be justified by reference to article 36 of the treaty, since consumer protection falls within a broad interpretation of the concept of public policy referred to in that article.

19 That argument cannot be accepted. Whatever interpretation is to be given to the term ' ' public policy ' ', it cannot be extended so as to include considerations of consumer protection. According to the aforesaid judgment of 17 june 1981, such considerations may in certain circumstances be taken into account in establishing whether national measures applicable without distinction to domestic and imported products are caught by the prohibitions laid down in article 30; they cannot, however, serve to justify restrictions on imports under article 36.

20 The answer to the question raised must therefore be that article 30 of the eec treaty must be interpreted to mean that the prohibitions laid down therein apply to a member state ' s legislation on unfair competition in so far as it makes it possible to prohibit the use, by an undertaking established in another member state, of a distinctive symbol lawfully used in that other member state, on the sole ground that the symbol was formerly used by a group of undertakings to which it belonged, in common with an undertaking established in the first member state which has since been wound up, and that the symbol might therefore be regarded by the public as a reference to the defunct undertaking or group.

Costs

21 The costs incurred by the government of the federal republic of Germany, the government of the french republic and the commission of the european communities, which submitted observations to the court, are not recoverable. As these proceedings are, in so far as the parties to the main proceedings are concernd, in the nature of a step in the action pending before the national court, the decision on costs is a matter for that court.

On those grounds,

The court,

In answer to the question referred to it by the landgericht München i by order of 9 june 1983, hereby rules:

The prohibitions laid down in article 30 of the eec treaty apply to a member state ' s legislation on unfair competition in so far as it makes it possible to prohibit the use, by an undertaking established in another member state, of a distinctive symbol lawfully used in that other member state, on the sole ground that the symbol was formerly used by a group of undertakings to which it belonged, in common with an under taking established in the first member state which has since been wound up, and that the symbol might therefore be regarded by the public as a reference to the defunct undertaking or group.