Exhaustion of IP: can patents and trademarks be enforced against parallel imports or are they exhausted?

18 minute read
16 March 2022

Are you familiar with what the 'exhaustion' of intellectual property rights means? Or that the law in this area governs whether the import of genuine IP-protected goods is lawful or not? If your business is involved in or interested in the movement across international borders of genuine goods protected by an intellectual property right, then you need to understand what the law on the 'exhaustion' of the relevant right is in the country of import.

Explore patent and trademark exhaustion internationally with our map

Launch the map via the 'View map' button for more detailed commentary.


View map


What is exhaustion?

What is meant by the 'exhaustion' of intellectual property? Well, in many countries the law provides that the owner of an intellectual property right cannot enforce its right (for example to prevent import into or sale in the country concerned) against genuine goods in certain circumstances: the rights of the IP owner are then 'exhausted'. The law on 'exhaustion' therefore governs when IP rights are enforceable against genuine goods and when they are not.

However, exactly how and in what circumstances IP rights are considered exhausted differs in different legal systems. Some countries provide in their legislation for a statutory exhaustion defence. In some countries an exhaustion defence is provided by judge-made law. In some countries the question of whether an IP right can be enforced against genuine goods is assessed by the courts without using the term 'exhaustion' but through the application of licensing concepts. Although much international agreement has been reached harmonising the types of IP protection available in different countries and how they are obtained, principles of exhaustion have not been harmonised in the same way.

Depending on the law in the country concerned, the answer to a question about whether an IP right is enforceable against particular genuine goods may depend upon the type of intellectual property right concerned, where the genuine goods concerned were first placed on the market, and the conditions of the first sale or marketing of the goods.

Note that when considering principles of exhaustion, there is an important distinction to be appreciated between 'genuine goods' and 'infringing goods'. Genuine goods are those manufactured and placed on the market (somewhere) by the owner of the relevant IP (in the country of import). Infringing goods are those manufactured and placed on the market (somewhere) by a person or entity unrelated to the owner (in a broad sense) of the relevant IP and which impinge upon that IP. Exhaustion principles concern genuine goods only.

Headline points on the law regarding exhaustion, for patents and trademarks, may be explored in our 'IP exhaustion map' above for Canada, the UK, France, Germany, UAE, Singapore and China.

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