Ch.3 International Exhaustion of Rights

Abstract

This chapter focuses on the issue of exhaustion of rights. Article 6 disclaims any intent in the Trade-related Aspects of Intellectual Property Rights (TRIPS) Agreement to limit the Members’ freedom to regulate the issue of exhaustion of rights with regard to all types of intellectual property rights (IPRs). It declares the admissibility of the international exhaustion of rights, that is, the possibility of legally importing into a country a product protected by intellectual property rights, after the product has been legitimately put on the market in a foreign market. These imports—made by a party without the authorization of the title-holder but equally legal—are generally known as ‘parallel imports’. Moreover, Article 6 of the TRIPS Agreement has left Member countries freedom to incorporate the principle of exhaustion of rights into their domestic law with a national, regional, or international reach. The issue as such cannot be the subject matter of a dispute settlement under the Agreement.