Malaysian laws generally do not prohibit the importation and sale of parallel goods.
What is prohibited are counterfeit or ‘pirated’ goods. Counterfeit goods are essentially fake and unauthorized replication of the original products not originating from the trade mark proprietor.
We are not going to discuss further about counterfeit goods and will focus on the issues relating to parallel imports. One has to note that section 35(1) of the Trade Mark Acts 1976 (“the Act”) expressly states that the registered proprietor shall have the exclusive right to the use of the trade mark in relation to the goods/services applied for. On the contrary, you may recall that a parallel importer, even though he is not the registered proprietor of the trade mark, may import and sell products bearing the trade mark. In such a case, is there any infringement of trade mark committed by the parallel importer?
Section 40(1) deals with acts not constituting infringement. The provision that we would want to look at is section 40(1)(d) where it ‘legalizes’ parallel importation. This section is closely related to the principle of exhaustion of intellectual property rights. Once a particular product has been sold by the trade mark proprietor or his registered user, his trade mark rights are said to be exhausted. In other words, where the registered proprietor of a trade mark or his registered user has placed his mark on the goods which are then marketed, the registered proprietor loses all rights to control subsequent dealings with the goods. To illustrate, if a trader obtains a trade mark registration, he will have exclusive rights over the use of the mark and he can legally prohibit anyone from using and selling products bearing his mark. However, he cannot prohibit customers who have bought the products from reselling to third parties.
It is not an act of passing-off to import genuine goods from overseas and sell them here under their respective trade marks because there is no misrepresentation as to the origin of the goods.
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Sole distributor for brand, other trading import different packing
Aug 11 2020, 05:49 PM
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