Wolf in Sheep’s Clothing? Trade Mark Rights Against Goods in Transit and the End of Traditional Territorial Limits

The December 2015 reform of EU trade mark law led to the introduction of a new exclusive right against goods in transit in Art. 9(4) of the EU Trade Mark Regulation and Art. 10(4) of the Trade Mark Directive. This new right raises complex questions of compliance with the international guarantee of freedom of transit set forth in Art. V GATT. In the light of the applicable international provisions, the status of the new right against goods in transit must at least be qualified as ambiguous. It is conceivable that it will be challenged on the ground that it leads to an unjustified impediment of international trade. As the new EU trade mark legislation requires the application of Art. 9(4) of the EU Trade Mark Regulation and Art. 10(4) of the Trade Mark Directive in line with international standards, in particular Art. V GATT, courts will have to face the complexity of the international legal framework and develop workable solutions by applying an amalgam of EU and international law. The result of this exercise will show whether the potential corrosive effect of the new right can be kept within reasonable limits. An overambitious interpretation would unmask the new right as a wolf in sheep’s clothing that imposes a heavy burden on world trade.