Moldova: Unauthorised Use of Objects of Intellectual Property under the New Competition Act

→ Andrian Guzun

As of 14 September 2012, Moldova has new competition legislation. The Competition Act No. ¹⁸³⁄₂₀₁₂ (Competition Act) transposes the EU competition acquis and introduces supplementary rules on the unauthorised use of objects of intellectual property (Unauthorised Use of OIP). Under the Competition Act, the Unauthorised Use of OIP is to be treated as practice of unfair competition.

Introduction

Com­pared to the old com­pe­ti­tion leg­is­la­tion, the Com­pe­ti­tion Act reg­u­lates in a more detail the prac­tices of unfair com­pe­ti­tion. Along­side oth­er ille­gal prac­tices¹, Unau­tho­rised Use of OIP is also deemed a prac­tice of unfair com­pe­ti­tion.

In rela­tion to Unau­tho­rised Use of OIP, Art.19(1) of the Com­pe­ti­tion Act pro­hibits any actions that may cause, by any means, con­fu­sion with a com­pet­ing under­tak­ing, prod­uct or eco­nom­ic activ­i­ty of a com­pet­ing under­tak­ing, and which are realised by par­tial or inte­gral ille­gal use of a mark, ser­vice logo, name, design or any oth­er objects of intel­lec­tu­al prop­er­ty, if such use may cause con­fu­sion with one legal­ly used by anoth­er under­tak­ing.

Unauthorised Use of OIP in the Competition Act versus intellectual property legislation

Dif­fer­ent from the cur­rent­ly valid leg­is­la­tion on intel­lec­tu­al prop­er­ty², the Com­pe­ti­tion Act takes a dif­fer­ent approach when it comes to Unau­tho­rised Use of OIP. The inter­dic­tion insert­ed by Art.19(1) of the Com­pe­ti­tion Act (see above) aims to devel­op a com­pet­ing envi­ron­ment, where­as the Com­pe­ti­tion Act as such does not impose on under­tak­ings the oblig­a­tion to reg­is­ter intel­lec­tu­al prop­er­ty rights before invok­ing the stat­ed norm. Under the intel­lec­tu­al prop­er­ty leg­is­la­tion, how­ev­er, rights are gen­er­al­ly con­ferred upon reg­is­tra­tion and have an indi­vid­ual char­ac­ter (ie, pos­si­bil­i­ties indi­cat­ed in the intel­lec­tu­al prop­er­ty leg­is­la­tion are for the sole ben­e­fit of the hold­er of an intel­lec­tu­al prop­er­ty right).

Investigations of Unauthorised Use of OIP

Under the new leg­is­la­tion, Unau­tho­rised Use of OIP is inves­ti­gat­ed by the Com­pe­ti­tion Coun­cil of Moldo­va (Com­pe­ti­tion Coun­cil). An inves­ti­ga­tion may be ini­ti­at­ed only at the request of an under­tak­ing whose inter­ests are prej­u­diced.

A request to inves­ti­gate acts of Unau­tho­rised Use of OIP must be sub­mit­ted in writ­ing using a tem­plate sub­mis­sion approved by the Com­pe­ti­tion Coun­cil (Art.51(1) of the Com­pe­ti­tion Act). Fail­ure to use the tem­plate is con­sid­ered by the Com­pe­ti­tion Coun­cil only as an infor­ma­tion com­mu­ni­ca­tion (Art.51(4) of the Com­pe­ti­tion Act) and might not trig­ger an inves­ti­ga­tion.

The request to ini­ti­ate exam­i­na­tion of acts of Unau­tho­rised Use of OIP is sub­ject to a six-month statute of lim­i­ta­tions (Art.14(5) of the Com­pe­ti­tion Act) start­ing from when the under­tak­ing knew or should have known about the acts of Unau­tho­rized Use of OIP com­mit­ted by oth­er undertaking(s). Fail­ure to meet the statute of lim­i­ta­tions is a ground for the Com­pe­ti­tion Coun­cil to refuse exam­i­na­tion. Such fail­ure does not, how­ev­er, block the dam­aged under­tak­ing from claim­ing prej­u­dice sep­a­rate­ly in a civ­il (com­mer­cial) action (Art.14(6) of the Com­pe­ti­tion Act).

A Com­pe­ti­tion Coun­cil inves­ti­ga­tion gen­er­al­ly con­sists of two phas­es: (i) the pre­lim­i­nary exam­i­na­tion of a request (Art.53 of the Com­pe­ti­tion Act); and (ii) the inves­ti­ga­tion in fact (Art.55 of the Com­pe­ti­tion Act). The sec­ond phase can be ini­ti­at­ed only if the Com­pe­ti­tion Coun­cil has rea­sons to sus­pect infringe­ment of the com­pe­ti­tion leg­is­la­tion. For the pur­pose of an effi­cient exam­i­na­tion and to avoid high­er prej­u­dices, the Com­pe­ti­tion Coun­cil may apply inter­im mea­sures (Art.41(3) of the Com­pe­ti­tion Act) such as inter­dic­tion to use a mark or sell prod­ucts.

Sanctions

Under the Com­pe­ti­tion Act, upon final­is­ing an exam­i­na­tion, the Com­pe­ti­tion Coun­cil may sanc­tion the under­tak­ing respon­si­ble for Unau­tho­rised Use of OIP with a fine of up to 0.5% of its annu­al turnover reg­is­tered in the pre­vi­ous finan­cial year (Art.77(1) of the Com­pe­ti­tion Act). The Com­pe­ti­tion Act also pro­vides solu­tions on how to sanc­tion under­tak­ings with no pre­vi­ous turnover.

It is not clear whether the fine applied by the Com­pe­ti­tion Coun­cil excludes, total­ly or par­tial­ly, penal lia­bil­i­ty of the breach­ing under­tak­ing. The Com­pe­ti­tion Act stip­u­lates that the appli­ca­tion of a fine by the Com­pe­ti­tion Coun­cil is a mea­sure of dero­ga­tion from Art.246¹ of the Penal Code. Hence, since the Com­pe­ti­tion Act does not reflect the extent of the applied dero­ga­tion, it is not clear whether the dero­ga­tion applies only to the fine, as a penal sanc­tion, or also to oth­er types of sanc­tion (eg, impris­on­ment of nat­ur­al per­sons or depri­va­tion of the right to per­form an activ­i­ty by the breach­ing under­tak­ing).

Com­pe­ti­tion Coun­cil sanc­tions are admin­is­tra­tive. Accord­ing­ly, an under­tak­ing that suf­fered prej­u­dice from an Unau­tho­rised Use of OIP may still bring civ­il (com­mer­cial) claims (Art.77(2) of the Com­pe­ti­tion Act). Sanc­tions against the infring­ing under­tak­ing may be reli­able proof of dam­ages.

Different from the currently legislation on intellectual property, the Competition Act takes a different approach when it comes to Unauthorised Use of OIP.

1

Eg, insti­ga­tion to ter­mi­nate the agree­ment with a com­pet­ing under­tak­ing, ille­gal use of the com­pet­ing undertaking’s trade secrets, etc.

2

Eg, Act No. ³⁸⁄₂₀₀₈, Act No. ¹⁶¹⁄₂₀₀₇, etc.