Simont Braun assisted Rewe in one of the largest mergers in the European retail sector

Simont Braun has advised Rewe, the second largest German supermarket chain, on the Belgian legal aspects of the purchase of Lekkerland/Conway, a major wholesaler specialised in consumption on the go, supplying gas stations, kiosks, convenience stores, etc. The transaction was signed on 28 May 2019 and the parties are now waiting for clearance by the competition authorities.

As both Rewe Group and Lekkerland are active in several European countries, their merger implied substantial cross-border aspects and the active cooperation of several top tier law firms, principally in Germany (lead), Belgium, Switzerland, the Netherlands and Spain.

Simont Braun’s Corporate M&A team advised Rewe on the Belgian legal aspects of the transaction, in particular by carrying out a legal due diligence on the Belgian target companies and assisted on the related legal and regulatory questions surrounding the transaction.

Our team is delighted to have contributed to such a landmark European cross-border transaction, in close cooperation with Taylor Wessing Germany (lead firm). Our demonstrated capabilities to act in the framework of international transactions make us a go-to law firm for such matters on the Belgian market. Our integrated multidisciplinary structure and strong linguistic skills were clearly a plus,” highlights Axel Maeterlinck, partner in Simont Braun’s Corporate M&A department.

The Rewe Group generated a turnover over € 61 billion last year, courtesy of its 360,000 employees in 22 European countries. With the merger with Lekkerland, a new European powerhouse is born in the convenience segment. Lekkerland has about 4,900 employees in Europe and generated a turnover of € 12.4 billion euro last financial year. In Belgium, the group operates under the name Conway and its 400 people generate a turnover of € 1.5 billion (source: www.retaildetail.be).

The Simont Braun team was led by partner Axel Maeterlinck, together with partners Fernand de Visscher, Steven Callens and the assistance of counsel Pierre Van Achter and associates Tine Bauwens, Laura Grauer, Julie Kever and Peter Blomme.

Two Partners appointed in the Industrial property Section of the Council for Intellectual Property

The FPS Economy has just appointed, for their legal expertise, Fernand de Visscher as President and Emmanuel Cornu as a member of the Industrial Property section of the Council for Intellectual Property.

The Council for Intellectual Property is an advisory body made up of experts and representatives of various sectors concerned with the intellectual property. Its main mission is to provide the Minister responsible for intellectual property with advice on any matter relating to intellectual property, in particular in the law-making process.

Its president and members are appointed for a term of four years.

 

The Belgian tax treatment of income stemming from the assigment of license of copyrights

Simont Braun recently assisted one of its clients in obtaining a ruling from the Ruling Commission in which an extensive and refined application was made of the interesting Belgian tax treatment with respect to personal income received from the assignment or license of copyrights.

The distinction between the compensation received by an individual in exchange for professional services rendered and the compensation received for assigning or licensing copyrights is made on the basis of a flat percentage (ranging between 5 and 25%).

The specific percentages as accepted by the Ruling Commission for each specific job description are based on a factual analysis of the individual tasks and creativity required for the respective job descriptions, as well as on the market value of the creative results which are protected by copyright.

Full article available in French and Dutch

 

Simont Braun promotes Philippe Campolini to Partner

Simont Braun is delighted to announce that Philippe Campolini has been promoted to partner, effective may 1, 2017.

Philippe started his career 10 years ago with Simont Braun’s Intellectual Property department and has become an expert in patent law and copyright. “He has always been a key asset to our IP department, contributing to the high level of quality and professionalism, which characterizes the firm, as well as bringing contagious energy to the team,” says Fernand de Visscher, head of Simont Braun’s Intellectual Property practice.

Philippe Campolini advises major national and multinational companies active in various sectors, in particular the medical devices, life sciences, automotive, and IT sectors.

Philippe is appreciated for his tough analytical skills and perseverance in defending clients’ interests both in and out of court. He has significant experience in drafting cast-iron licensing, technology transfer and R&D cooperation agreements. Our clients can also count on Philippe’s in-depth knowledge of trade practices and unfair competition law, especially advertising and trade secrets law.

“With his sharp mind and pragmatism, Philippe is an excellent addition to our partnership,” says Managing Partner Vanessa Marquette. “Fluent in French, English, Dutch, German, Italian and Spanish, he will strengthen both the national and international development of our patent law and copyright practices.”

Contact: Philippe Campoliniphilippe.campolini@simontbraun.eu – +32 (0)2 533 17 17

Curing rules on parallel import of pharmaceuticals?

On 7 November 2016 the Belgian Supreme Court (Cour de cassation – Hof van cassatie) gave judgment in two cases regarding the repackaging of pharmaceuticals, wherein it ruled in favour of the parallel importer with respect to the exhaustion of trademark rights principle. Simont Braun represented with success the defendant in these two cases.

Just three days later, on November 10, 2016, the CJEU gave a preliminary ruling on a question submitted by a Danish court in a similar case.

All three cases dealt with the issue of whether a trademark owner can oppose the parallel import of trademarked pharmaceuticals of which the packaging format has been modified.

The Belgian proceedings concerned the medicine ‘Cozaar’, containing the active component ‘Losartan’ in a dose of 50 milligrams in one case and a dose of 100 milligrams in the other case, both manufactured by Merck and imported by Pi Pharma into Belgium from Poland. In both proceedings, Pi Pharma bought the most common Polish packaging format of 28 tablets and repackaged these in formats of 98 tablets for the Belgian market.

In the Danish case, the parallel importer Orifarm imported the medicine ‘Klyx’ from Norway to Denmark, after having repackaged it from boxes containing 10 doses into boxes containing 1 dose. In the Danish case, just like in the Belgian 50-milligram case, both packaging formats at stake (i.e. the formats before and after repackaging) were available in the importing as well as in the exporting State. In the Belgian 50 milligram case, the 28 tablets packaging represented only 2% of the market, while in the 100-milligram case, the 28 tablets packaging was absent in the Belgian market.

Both the CJEU and the Belgian Supreme Court start their judgments by recalling the previous CJEU case law on the interaction between the principle of free movement of goods and the trademark rights. According to this case law, a trademark owner can only oppose importation of previously marketed and repackaged products within the EU or EEA if such opposition does not contribute to the artificial partitioning of the single market. Such partitioning occurs when the repackaging is objectively necessary to allow the importer to sell the repackaged products in the importing State. This may be the case when the product cannot be marketed in the importing State because of, in particular, a rule authorizing packaging only of (a) certain size(s) or a national practice to the same effect, sickness insurance rules making the reimbursement of medical expenses depend on the size of the packaging, or well-established medical prescription practices based, inter alia, on standard sizes recommended by professional groups and sickness insurance institutions. Then, where, in accordance with the rules and practices in force in the importing State, the proprietor uses several different sizes of packaging in that importing State, the finding that one of those sizes is also marketed in the exporting State is not enough to justify the conclusion that repackaging is unnecessary. Partitioning of the markets would exist if the importer were able to sell the product only in a limited part of the market.

The Belgian Supreme Court applied this case law by ruling that a trademark owner cannot oppose the repackaging and parallel import if the importer proves that without repackaging he would have access only to a limited part of the market in the importing State. In order to assess this, the Brussels Court of appeal had taken into account the whole Belgian market (all packaging formats) of the active component in their doses of 50 and 100 milligram respectively. The Court of appeal noted that the sale of 28 tablets packaging formats of the 50 milligram Cozaar in that market was marginal (2%) due to the Belgian popularity of the 98 tablets version. This was considered sufficient to prove that the pharmaceuticals in the 28 tablets format could be marketed in a limited part of the Belgian market only, thereby depriving the importer of effective access to the market as a whole. In the proceedings regarding the 100-milligram doses, the 28 tablets format was even inexistent in Belgium, so that the repackaging was also considered necessary. This analysis of the Brussels Court of appeal was explicitly confirmed by the Belgian Supreme Court in the 50-milligram case (in the 100-milligram case, the appeal was dismissed by the Supreme Court for mere procedural reasons). In both cases, repackaging has been objectively determined by the Court of appeal as necessary in order to enable entering the Belgian market. Allowing a trademark holder to oppose the repackaging in such circumstances would lead to the creation of artificial barriers to national markets and would undermine the EU/EEA single market.

A couple of days later, the CJEU went on to apply the same rules in the Danish case. The referring court asked whether the contested repackaging (from packets of 10 doses to packets of 1 dose) could be considered as “necessary” given that the products were available in both formats in the importing and exporting States, while the parallel importer argued that the partitioning of markets is an inherent consequence of the opposition to the repackaging, because the importer could then penetrate the Danish sub-market of packets of one dose of Klyx solely by importing the product in the same packaging from Norway.

On this specific point, the CJEU stated that it was not apparent from the court bundle that the market for Klyx in packets of 10 doses represents only a limited part of the market of the importing State, namely Denmark, and that it is for the referring national court to determine if such a condition is met in the main proceedings.

This led the CJEU to conclude that trademark owners may object to parallel import of repackaged pharmaceuticals when (i) the medicinal product at issue can be marketed in the importing State in the same packaging as that in which it is marketed in the exporting State and (ii) the importer has not demonstrated that the imported product can be marketed only in a limited part of the importing State’s market.

Whether these judgments in any way “cure” (or clarify) the rules on the parallel import of pharmaceuticals is doubtful. As it appears from this case law, the central question is : what is a “limited part” of a market? The Belgian cases confirm that 0% or 2% of a market are limited parts of that market, which seems rather obvious. However, the question whether, under what circumstances and to what extent a part of a market will be determined as a “limited” part of that market, is a very factual question that remains open and will need to be clarified on a case-by-case basis.

Fernand de Visscher, Eric De Gryse and Philippe Campolini

European patents – Late filing of a translation in Belgium: new special restoration procedure with retroactive effect

In a previous article, we commented on the special restoration procedure that was instituted by the Belgian legislator in favour of European patent holders that had forfeited their rights because the translation of their patent was filed too late with the Belgian IP Office (OPRI). Amongst other things, we noted in our previous news that this special restoration procedure, only available for a one-off period of six months ending on 22 March 2015, was only open (under certain conditions) to European patents that had been subject to an opposition or a central limitation procedure. We commented on that limitation by saying that this requirement “might be viewed as a form of discrimination that the Constitutional Court could judge contrary to the equality rule, combined with the respect due to the right of property.” We concluded as follows:

“Although the law only refers to European patents “maintained as modified or limited”, we believe that it should also be possible to file a special restoration application for patents issued without opposition or limitation. If the OPRI were to refuse to grant restoration and that decision were appealed against, it can doubtlessly be expected that a reference would be made to the Constitutional Court for a preliminary ruling.”

Our analysis was confirmed by a judgment of March 2015 by the Brussels Court of Appeal. As a consequence, and to avoid any further problems, the Belgian legislator recently instituted a new special restoration procedure. This time the procedure is also open to European patents that were not subject to opposition or limitation procedures and that could therefore not benefit from the initial special restoration procedure.

What are the requirements for being able to use this new special restoration procedure?

The date of grant of the European patent cannot be later than 21 September 2014;

  • The patent owner had no access to any of the other restoration procedures instituted by the Belgian legislator (i.e. the “normal” restoration procedure in case of translations filed with delay or the first special restoration procedure ending on 22 March 2015) ;
  • A translation of the patent has been filed, but too late;
  • The request for this new special restoration is filed before 5 January 2017.

If you think one of your European patents, or one of your client’s European patents, could be in this situation, you should urgently consider filing a request for restoration with the Belgian IP Office. We are at your disposal should you need any further information on the above.

Fernand de Visscher, Eric De Gryse and Philippe Campolini

 

Validation of European patents in Belgium: filing of a translation no longer required as from 2017

From the 1st of January 2017 onwards, the filing of a translation with the Belgian Intellectual Property Office will not be required any longer in Belgium for European patents delivered in English.

This new regime will only be applicable to European patents of which the mention of the grant or the maintenance, in amended or limited form, are published from the 1st of January 2017 onwards.

If the mention is published before that date, the filing of a translation of the European patent will still be required.

See here the letter of the Belgian Intellectual Property Office of 30th of September 2016.

Fernand de Visscher, Eric De Gryse and Philippe Campolini

 

Introduction in Belgian law of a new copyright exception: “The Panorama Exception”

In Belgium, as well as in France, many strived for years in order to introduce a new copyright exception, which would allow the reproduction and communication to the public of works which are permanently situated in public places (the so-called « panorama exception »). Next to France, Luxemburg, Italy and Greece, Belgium was one of the few EU Member States, which did not foresee such an exception in its copyright laws.

In Germany, the concept «Panoramafreiheit» exists already since 1876. And there is a similar exception in the United Kingdom, introduced by the de Copyright, Designs and Patents Act of 1988, which even applies to the interior of public buildings. Eventually Directive 2001/29 on the harmonisation of certain aspects of copyright and related rights in the information society foresaw in 2001 the possibility to create exceptions to the property rights when there is «use of works, such as works of architecture or sculpture, made to be located permanently in public places» (article 5.3, h of the Directive).

After much debate, the French Assemblée Nationale decided on 21 January 2016, to line up with the numerous Member States which already knew the exception by accepting freedom of panorama, however, limited to usage with non-lucrative ends.

As is clear, the exception has a vast number of varieties. The one, which was ultimately introduced in Belgian by the law of 5 July 2016 allows “the reproduction and communication to the public of works of visual, graphic and architectural art, which are made to permanently remain in public places, provided that the work is reproduced as it is and provided that such reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author”. The preparatory works point out that the concept «public places» is not applicable to the interior buildings, which are not permanently open to the public. Furthermore, the text points out that the work must be reproduced «as it is», which means that  «in the public space». These clarifications seem to prevent certain acts from being possible, as for example photomontages containing the photographed building.

During the legislative process, the question arose whether the French model of the exception should be taken as a reference, and if a direct or indirect commercial purpose should be excluded from the exception. One may think, for instance, at the selling of postcards containing a picture of the copyrighted work. An amendment in that sense was proposed, but was ultimately rejected. The reason given to that rejection was that this limitation was unnecessary: the guarantee that the reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author, would be sufficient to prohibit such commercial uses. These conditions correspond to the second and third conditions of the so-called triple test (see article 5.5 of the Directive).

What are the practical consequences for Belgian law and what exactly will change?

Inspired by the expression of Rémi Mathis in an article in the newspaper Le Monde we can hold that it will « give Belgians their architectural landscape back ».
Some will be surprised to read that before the introduction of the panorama exception, it was prohibited to reproduce or communicate to the public a picture of which the central subject was a copyright protected work present in the public place. Therefore, it was necessary, for example, to ask the authorisation of the architect of the Atomium (or his successors in title) to publish a picture of it on the internet.

However, such reproduction or communication to the public was not prohibited in all situations. When the copy was purely made for private purposes, it was allowed. Tourists could, thus, freely take pictures of the Atomium, as long as these were not afterwards published. Moreover, Belgian law already contained an exception to the reproduction and communication to the public of a work located a public place, provided that the main subject of the reproduction or communication was not the work itself. Therefore, a picture of a couple posing in front of the Atomium, for example, could legally be put on the internet.

Because of the introduction of the panorama exception, it is nowadays possible to photograph all visual, graphic and architectural works, which are intended to be permanently placed in public, even if the general subject of the photo is the protected work itself, and furthermore, to communicate these pictures without authorisation of the author of the work concerned. However, attention has to be paid to the limitations of the new exception. Indeed, the work has to be reproduced or communicated to the public as it is placed in the public space. Furthermore, the reproduction or communication may not conflict with the normal exploitation of the work and may not unreasonably prejudice the legitimate interests of the author.

Philippe Campolini    Fernand de Visscher

The payment of royalties in case of annulment or non-infringement of the patent

In the court decision of 7 July 2016 (C-567/14, Genentech) the Court of Justice of the European Union reaffirmed the solution as presented by the Court in its decision of 12 May 1989 (C-567/14, Ottung): the prohibition on anti-competitive agreements (article 101, §1 TFEU) does not affect the contractual obligation of a fee for the use of a technology that is not or is no longer covered by a patent, on the condition that the licensee is at every moment in the possibility to end the existing agreement.

The Court had already stated that such a clause could be the reflection of the value parties give from a commercial point of view to the exploitation possibilities the license agreement is about.

In the most recent case, the question was treated from a small different point of view, but the solution firmly stayed the same. The Court underlined the importance of the fact that a licensee is free to end the agreement at all time.

The license concerned (1992) covered a worldwide non-exclusive license regarding certain technology, which was protected by a European and two American patents. The European patent was declared null and void several years after by the OEB (1999), while the American patents, although likewise attacked, remained in place.

Next, the licensee ended the agreement, while the American patents were still applicable.

In this case, the Court regarded the two American patents, which protected the technology concerned as the only relevant patents: the patents were not declared null and void, but the Court held that the licensor did not use the patents after the termination of the agreement (counterfeit).

The dispute arose because the licensee failed to pay the royalties as was foreseen by the license agreement. When considering the dispute before him, the arbitrator accepted the responsibility of the licensee to pay the royalties. The punishment he had foreseen was the subject of an action for annulment with the Court of Appeal in Paris, which was asked to render a judgment regarding the compatibility of the solution rendered by the arbitrator with article 101, §1 TFEU (prohibition on anti-competitive agreements).

The arbitrator had reached its solution taking into account the German law regarding license agreements. He was of the opinion that the commercial purpose of the parties was to lighten the risk on the licensee to face infringement proceedings of the licensor, while using the technology. This view was opposed to the opinion of the licensee, who argued that with the absence of infringement, no compensation needed to be paid.

Thus, the relevant question comprised of knowing if article 101, §1 TFEU precludes that an obligation within such an agreement is put on the licensee to pay a compensation fee for use of the technology, in the period when a license is applicable, while an annulment of the patent is still a possibility or, like in the case at hand, a declaration non-infringement of the patents, which protect this technology, by other parties.

The Court of Justice pointed out that the solution put forward in the decision of 12 May 1989 is a fortiori applicable in this case. While a license agreement is in force, the payment is due, even after the patent expires. Thus, this also applies when the patent is still in force (which was in casu the situation, the American patents stayed applicable until termination of the license agreement by the licensee and were not declared null and void).

In our opinion two main elements played a role when the Court considered the case, being on the one hand, the fact that in German law regarding license agreements, a non-infringement has no influence on the payment of the royalties. The reason is that the commercial purpose of the parties consists in protecting the licensee for the risk for infringement. On the other hand, another element is the fact that the licensee has the possibility, as was in the previous case, to terminate the agreement at every moment.

The payment of royalties regarding a patent, while it has become inapplicable or declared null and void, or when there is no infringement, primarily is debated in the framework of anti-competitive restrictions. As the reasoning of the case clearly indicates, the particularities of every separate case will have to be considered.

Fernand de Visscher

20160412

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