Due to the Protocol on Ireland and Northern Ireland, Northern Ireland is in the unique position of having access to both the United Kingdom (UK) and European Union (EU) markets, but is our access to the EU market as “unfettered“ as some may suggest?
Current goods placed on the market anywhere in the United Kingdom can be moved freely around the European Union. One thing which makes this possible is the concept of “exhaustion of rights” in regards to Intellectual Property Rights (IPRs). Goods placed on the market anywhere in the EU including the UK by the owner of the IPRs, or with their consent, “exhausts” the IPR rights in those goods. This means that the purchaser of the goods can move them anywhere within the EU and further deal with them without, except in very specific circumstances, interference by the IPR owner.
The IPR in any goods placed on the market within the UK or EU before 01st January 2021 will continue to be exhausted in both the UK and EU however then, as with so many other things, the situation changes.
While unlikely to be the long-term position, the UK government have stated that after 01st January 2021, goods placed on the market in the EU will continue to exhaust rights in the UK.
The EU have not reciprocated. Goods placed in the market in the UK after 01st January 2021 will not exhaust rights in the EU. Those who wish to bring goods from the UK onto the market in the EU will require the consent of the IPR owner.
What does this mean for goods places on the market in Northern Ireland which has a ‘special’ relationship with the EU and the common market?
The EU Commission states: –
“While the Protocol on Ireland/Northern Ireland provides that certain rules of the EU acquis in respect of goods apply to and in the United Kingdom in respect of Northern Ireland, it does not provide for the exhaustion of intellectual property rights in the EU (emphasis added) in cases where a good has been legally put on the market of Northern Ireland” .
The consequences of this is that goods placed on the market by the owner of IPRs, or with their consent, in Northern Ireland after 01st January 2021 will not be exhausted in the EU therefore the owner of an IPR in goods put on the market in Northern Ireland can prevent the import of those goods into the EU, including into Ireland.
Those who import such goods without the consent of the owner of the IP rights may potentially face infringement action.
We recommend that you review your supply chain. Are you obtaining goods from the United Kingdom? Do you, or your supplier, have the consent of the owner of those rights to bring those goods into the EU after 01st January 2020?
If you own Intellectual Property Rights, consider whether you wish to allow the import of those goods from the UK into the EU? If not, what action can you take to prevent it?
If you would like to arrange a consultation with one of our IP experts please contact us.