Analysis And Comments On The Problem Of Parallel Importation In Respect Of International Protection Of Intellectual Property Rights

This article had explored the controversy over parallel importation in respect of international protection of trademark, patent and copyright, by comparing the legislation and precedents of the United States, European Union, Japan etc, and so on. Relevant provisions of the TRIPS Agreement and other treaties (such as the WIPO Copyright Treaty and Performance Treaty adopted in 1996) have also been analyzed. It has three parts: preface, main text and conclusion, with about 39,000 words in all. There are five chapters in the text of this article.Chapter one mainly summarizes the basic theories with respect to parallel importing. Parallel importing which is also called "gray markets", are not generally considered illegal, in contrast to the "black" markets of stolen or counterfeit goods. Rather, "gray goods" are genuine in terms of their manufacturer, but their distribution is "unauthorized" by the holder of intellectual property right after their lawful first sale (note: "parallel importing" and "gray market" used in this article shall be deemed fungible). There are distinct scenarios gray market may occur. Section two analyzes the causes for gray markets, and briefly introduces the arguments for and against parallel importing. Section three deals with the theoretical dilemmas encountered in addressing problems on parallel importing, including but not limited to: the conflict between worldwide free trade and the protection of intellectual property rights, universal principle vs. territorial principle, national, regional and international exhaustion doctrines adopted by different countries. More and more countries have amended their laws to allow parallel importing by adopting international exhaustion doctrine. So territoriality of intellectual property rights has softened up. Chapter two discusses the complicated and vacillating U.S. policy on parallel importing. U.S. Congress and the courts had shifted from universal doctrine to territorial principle with certain exceptions since 1923, even though it actively advocates free trade principle within WTO scheme. Currently, parallel importing into U.S. can be prohibited based on material difference and likelihood of consumer confusion under Lanham Act and enforced by the Customs Service pursuant to §526 of the Tariff Act. Copyright owners can exercise their importing right under the Copyright Act to combat parallel importing. Chapter three focuses on the "community exhaustion" adopted by the European Union. In the Silhouette case the European Court of Justice ("ECJ") ruled that community wide exhaustion is the proper interpretation in light of the 1989 Trademark Directive. The judgement precludes Member States from adopting an exhaustion regime wider than community exhaustion, though it does not extend to those EEA member states who are not EU member states. But the English high court adopted international exhaustion doctrine on the basis of implied consent, rather than following the community exhaustion doctrine, in adjudicating a trademark parallel importing case. So the effectiveness of the Silhouette ruling is pending. This situation demonstrates that EU member states don't expect the ECJ's ruling to interfere with their trade relationship with non-member states. Chapter four deals with the international exhaustion adopted by Japan, and legislation reforms made by other states or territories. In BBS parallel importing case in respect of patented products, what is noteworthy is the reasoning of Japan Supreme Court that an opportunity is guaranteed for him to recover compensation for public disclosure of his patented invention. Legislation or law changes in Australia, China Taiwan, and other territories demonstrate that international exhaustion doctrine is accepted by more countries.In chapter five, the author holds that, even though TRIPS Agreement and other treaties haven't settled the exhaustion problem, WTO wide exhaustion is possible to be put forward in the future accompanied by the development of free trade, by comparison of respective provisions of...