UK: National Courts Can Apply TRIPs Directly

The European Court of Justice has ruled that national courts are free to decide whether or not to apply TRIPs (Trade-Related Aspects of Intellectual Property Rights Agreement) directly as long as doing so would not give rise to a conflict with Community law. The Article of TRIPs in question concerns the life of a patent and by applying TRIPs, the national Portuguese court could potentially extend that life to the full 20 year term.

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The European Court of Justice has ruled that national courts are free to decide whether or not to apply TRIPs (Trade-Related Aspects of Intellectual Property Rights Agreement) directly as long as doing so would not give rise to a conflict with Community law. The Article of TRIPs in question concerns the life of a patent and by applying TRIPs, the national Portuguese court could potentially extend that life to the full 20 year term.

The World Trade Organisation's (WTO) Trade Related aspects of Intellectual Property Rights Agreement was one of the major achievements of the Uruguay Round (the largest trade negotiation in history) which also created the WTO. It sets out minimum standards of intellectual property protection that WTO Members must provide.

The European Court (ECJ) received a reference from the Portuguese Supremo Tribunal de Justica regarding the case Merck Genéricos – Produtos Farmacêuticos Ldª v Merck & Co. Inc. and Merck Sharp & Dohme Ldª. The US pharmaceutical company Merck & Co. Inc. (Merck) owned a Portuguese process patent for preparing a pharmaceutical compound containing the active substance Enalapril. The patent was granted on 8th April 1981 and from 1985 was used to produce a product marketed as ‘Renitec’. Merck Sharp & Dohme (MSD) was granted the right to exploit the patent.

In 1996 Merck Genéricos put to market a pharmaceutical product under the trade mark ‘Enalapril Merck’, undercutting ‘Renitec’ in price and claiming it to be the same product as ‘Renitec’. Merck and MSD brought an action against Merck Genéricos who argued that the period of 15 years of patent protection provided for by Article 7 of Portugal’s 1940 Industrial Property Code had expired on 9th April 1996. Merck and MSD countered that, by virtue of Article 33 of the TRIPs Agreement (which provides for a minimum term of 20 years), the patent in question had not expired until 1999.

The Portuguese court referred two questions to the ECJ. Firstly it asked ‘Does the [ECJ] have jurisdiction to interpret Article 33 of the TRIPs Agreement?’ And if so, ‘must national courts apply that article, on their own initiative or at the request of one of the parties, in proceedings pending before them?’

The Court declared that as the TRIPs agreement was concluded by the Community and its Member States by virtue of joint competence, when hearing a case brought before it in accordance with EC Treaty provisions, it follows that the ECJ has jurisdiction to define the obligations the Community has thereby assumed and for that purpose, to interpret the provisions of the TRIPs agreement. The ECJ went on to rule that as Community legislation now stands in the sphere of patents, it is not contrary to Community law for Article 33 of TRIPs to be directly applied by a national court subject to any conditions provided for by national law. This matter will now go back to the national Portuguese court which, now armed with answers to its questions, will have to reach a decision on whether or not to apply Article 33 of TRIPs.

Click here to see the full ECJ judgement.

The effect of this decision is that it allows national courts to apply TRIPs directly thus potentially extending the life of patents in some jurisdictions such as Portugal. This of course will be welcome news to patent owners who thought their national protection was for a term of less than twenty years. The decision also serves as a reminder of the importance of TRIPs to intellectual property law in the European Union.

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq

The original publication date for this article was 02/10/2007.