Australia: The Case Of The Polo Player – Labels, Parallel Importation And The Copyright Act

If you've ever travelled and shopped, you'll know that it is often cheaper to buy that irresistible Chanel handbag overseas and bring it back with you, than it is to buy it at home. But what's stopping a wholesaler or retailer from doing the same thing in bulk?

The Polo/Ralph Lauren Company v Ziliani Holdings

In the recent case of The Polo/Ralph Lauren Company v Ziliani Holdings, Ziliani travelled to the US and purchased genuine Polo/Ralph Lauren clothing bearing the famous embroidered polo player logo, which he intended for resale in Australia. The Polo/Ralph Lauren company, as copyright owner, had not licensed or consented to the importation or sale of the clothing bearing the logo.

The company commenced proceedings against Ziliani, alleging that it had infringed the copyright in the logo, a well established argument which, prior to 2000, had been extensively relied upon to prevent parallel importation of goods into Australia.

The non-infringing accessory defence

As part of its defence, Ziliani claimed that the polo player logo embroidered on the clothing was a 'label' and, therefore, a 'non-infringing accessory' - the importation of which escaped liability under the Copyright Act.

The defence, introduced in 2000, permits the commercial importation of 'non-infringing accessories' with articles, even if those accessories are copyright protected. Relevantly, a non-infringing accessory includes copyright protected labels affixed to, displayed on, or incorporated into the surface of an article as long as the labels were made in an authorised country and with the consent of the copyright owner.

Although it had been made in an authorised country and with the consent of the copyright owner, the question before the court was whether the embroidered polo player logo, itself, could constitute a 'label' within the meaning of the Act. Polo argued that it wasn't just a label. The court held that it was, and the claim against Ziliani failed.

Some important issues

The Polo case underlines the reality that the owners of designer labels don't have the legal means they once had to protect their local monopolies. Polo or Chanel can exclusively license the sale of their brands in Australia, but they cannot use the fact that they own the copyright in their distinctive logos as a way of preventing the importation by others of genuine articles.

From the consumer's point of view, that has to be a good thing.

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