In the recent Case AT. 40433 – Film merchandise involving the legality of licensing agreements covering trade marks and other IP rights under Art. 101 TFEU, the European Commission stated the following:
‘In Consten and Grundig, the Court established a distinction between the existence and the exercise of intellectual property rights with regard to an agreement for the assignment of a trade mark aimed at partitioning the internal market. The Court held that rights under national trade mark law, such as the right to assign the trade mark, cannot be exercised so as “to frustrate the Community’s law on cartels”’.
(European Commission, Case AT. 40433 – Film merchandise, C(2020) 359 final, para. 90)
Critically discuss this statement, reflecting upon the functions of trade marks and the interaction between trade mark law and EU competition law. Please address in your discussion the following points:
– When are trade mark protection and competition reinforcing and complementing each other? When are both in tension with each other?
– How do trade mark and EU competition law address and resolve these tensions?
What is the role of the distinction between the existence and the exercise of the trade mark rights in this respect?
– Is the case law of the EU courts and the European Commission drawing the right balance between trade mark protection, innovation and competition?
Support your discussion with concrete examples from the relevant case law, legal guidance papers and academic literature.
