The Intellectual Property Office (IPO) has this month launched a consultation seeking views on the UK’s future regime for the exhaustion of intellectual property rights.
The consultation comes after the UK left the European Union this year, paving the way to create an independent intellectual property system.
Luke Morgan, a Director with Palmers who specialises in Intellectual Property matters, explained: “The exhaustion of IP rights are the laws that govern parallel trade between two jurisdictions – ‘exhaustion’ is defined as rights that cannot be used to stop the further distribution or resale of those goods.
“Any business that moves, sells or relies on goods – such as literature, automobile parts or cleaning products – that have already been first placed on the market in another territory will be affected by any potential changes to the rules.”
Prior to the end of the transition period, parallel goods were able to move freely in both directions between the UK and the European Economic Area (EEA).
But since 01 January 2021, the UK no longer participates in EU legislature and has reverted to the legal default.
The IPO warned businesses exporting protected goods from the UK to the EEA to check the new rules for parallel exporting to avoid infringing on other’s rights.
According to the regulator, IP rights in goods placed on the UK market by – or with the consent of the right holder – after 31 December 2020 may no longer be considered “exhausted” in the EEA.
In practice, it means that businesses parallel exporting these IP-protected goods from the UK to the EEA “might need the rights holder’s consent”.
The IPO said businesses affected by these changes should “check whether they currently export legitimate, IP-protected goods to the EEA” and contact the rights holder to “get permission to continue exporting these goods after 01 January 2021”.
It has been confirmed, however, that goods placed on the EEA market after the transition period will “continue to be considered exhausted in the UK” – meaning parallel imports into the UK from the EEA will be unaffected.
Luke added: “Regardless of the outcome of the consultation, businesses should continue to take all necessary steps to protect their intellectual property rights by seeking expert legal advice.”
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