Articles

Romanian Chapter in “Intellectual Property & Antitrust 2012”

Published in “Getting the Deal Through – Intellectual Property & Antitrust 2012”

1 Intellectual property law

Under what legislation are intellectual property rights granted? Are there restrictions on how IP rights may be exercised, licensed or transferred? Do the rights exceed the minimum required by the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs)?

Intellectual property rights are mainly regulated by the following Romanian normative acts:

• Law No. 8/1996 on copyright and related rights, as further modified and completed (the Copyright Law);
• Law No. 64/1991 on patents, as republished (Patents Law) and Government Decision No. 547/2008 for the approval of the Regulation for implementation of Law No. 64/1998 on patents;
• Law No. 350/2007 on utility models (the Utility Models Law) and Government Decision No. 1457/2008 for the approval of the Regulation for implementation of Law No. 350/2007 on utility models;
• Law No. 84/1998 on trademarks and geographical indications, as republished (the Trademarks Law) and Government Decision No. 1134/2010 for the approval of the Regulation for implementation of Law No. 84/1998 on trademarks and geographical indications (the Trademarks Regulation);
• Law No. 129/1992 on the protection of designs and models, as republished (the Designs Law) and Government Decision No. 211/2008 for the approval of the Regulation for the implementation of Law No. 129/1992 on the protection of designs and models;
• Law No. 16/1995 on the protection of topographies of semiconductor products, as republished (the Topographies of Semiconductor Products Law) and the Order No. 6/2007 of the State Office for Inventions and Trademarks (SOIT) for the approval of the Norms for the implementation of Law No. 16/1995 on the protection of topographies of semiconductor products, as republished; and
• Law No. 255/1998 on the protection of new plant varieties, as republished (New Plant Varieties Law) and Government Decision No. 984/2007 for the approval of the Regulation for implementation of Law No. 255/1998 on the protection of new plant varieties.

In general, the industrial property rights (copyright and related rights not included) are acquired under Romanian IP legislation through various registration procedures. There are also exceptions applicable to industrial property rights protected without registration, such as notorious trademarks.

The Copyright Law protects the moral and patrimonial rights conferred by creation of original works, irrespective of the concrete manner of expression, value or destination and irrespective of any registration formalities.

As a general rule, IP rights may be freely exercised, licensed or transferred by their legitimate owners.

However, there are certain restrictions and exceptions:

• related to the exercise of copyright and related rights – the private copy exception, the right to reproduce copyright-protected works within judicial, parliamentary or administrative proceedings or for public safety purposes, etc;
• regarding the transfer of rights – moral rights cannot be transferred or waived. Also, the non-exclusive assignee of economic rights related to copyright may not further transfer the acquired rights, without the express consent of the assignor;
• related to the exercise of the rights over patents, the Patents Law provides for several situations in which mandatory licences may be granted upon request by interested third parties by the Bucharest Tribunal. The mandatory licences may be transferred only together with the part of the undertaking or of the business assets that benefit from the respective use;
• similarly to the Patents Law, the Topographies of Semiconductor Products Law provides for several situations in which mandatory licences may be granted upon request by interested third parties by the Bucharest Tribunal. The mandatory licences may be transferred only together with the patrimony (business assets) attached to their application;
• related to the exercise of rights over trademarks, anyone with a legitimate interest may request the court to deprive a trademark owner of its rights if, without legitimate reason, the mark was not effectively used in Romania within an uninterrupted period of five years as of the registration of the trademark within the Trademarks Register or if this use has been suspended for an uninterrupted period of five years. Regarding the transfer of rights – identical or similar trademarks having the same registered owner and used for identical or similar goods or services may be assigned only as a whole and to one person, under the sanction of nullity of the assignment. SOIT may refuse to register a trademark assignment if it results in a clear misrepresentation, such that the public will be mistaken as to the nature, quality or geographical origin of the products or services for which the trademark has been registered, except where the beneficiary of the assignment accepts to limit the trademark assignment to the products and services for which the trademark is not misleading; and
• a non-exclusive licensee that has been granted the right to exploit a patented new plant variety may not transfer this acquired right to third parties.

The IP rights granted under Romanian IP legislation exceed, in certain cases, the minimum provided under the TRIPs Agreement (for example, the initial registration term and each renewal term of trademarks is 10 years, which is above the minimum of seven years provided under the TRIPs Agreement; similarly, the validity period of designs is 10 years and can be renewed for three successive periods of five years, above the minimum 10 years provided under the TRIPs Agreement, etc).

2 Responsible authorities

Which authorities are responsible for administering IP legislation?

The authorities responsible for administering IP legislation are mainly the Romanian Copyright Office (ORDA) and the Romanian State Office for Inventions and Trademarks (SOIT).

ORDA is a specialised central public administration body subordinated to the government, having legal personality, being the sole authority for regulation, evidence (through national registries), surveys, authorisation, arbitration and technical-scientific expertise in the copyright and related rights field.

SOIT is a specialised body of the central public administration subordinated to the government, being the sole Romanian authority empowered to grant protection for industrial property, in accordance with the national legislation in the field and with the provisions of the conventions and international treaties to which Romania is a party.

In addition, an important role in protecting IP rights is fulfilled by the customs authorities, which may retain goods infringing intellectual property rights or suspend the clearance operations for such goods, or do both.

3 Proceedings to enforce IP rights

What types of legal or administrative proceedings are available for enforcing IP rights?

Generally, an IP rights owner may enforce its rights either in civil or criminal proceedings, or both. Thus, for example, an owner may file criminal complaints against infringers, actions for cancellation of conflicting IP rights, civil actions in infringement or unfair competition with the possibility of claiming damages for the incurred loss.

Also, the IP rights owner may seek temporary measures by way of a preliminary injunction, under the provisions of the Romanian Civil Procedural Code.

The owners of intellectual property rights may also file with the National Customs Authority applications for customs action, based on which, the customs authorities may retain the goods likely to infringe the intellectual property rights that are the object of the application or may suspend the clearance operations for such goods, or do both.

In addition, the industrial property rights owners may oppose the registration of conflicting industrial property rights in administrative proceedings before SOIT. SOIT’s decisions issued in these proceedings may be further appealed in front of the competent courts.

4 Remedies

What remedies are available to a party whose IP rights have been infringed?

A party whose IP rights have been infringed may seek civil or criminal remedies, or both. Thus, for example, such a party may request the court to prohibit the unlawful use of its IP rights and to pay damages for the incurred loss (to the extent a loss is proved). Also, the IP owner may request the court to order, at the expense of the infringer, the seizure and destruction of the infringing goods and of the equipments, instruments and materials used for their manufacture.

In addition, the infringer may be compelled to disseminate the information on the decision rendered by the court, through different means of communication, such as display or publication of the decision or additional publicity measures adapted to the particular circumstances of the case, including a large advertisement.

Also, if not filed, a customs application may be filed based on which, as mentioned above, the customs authorities may retain the goods likely to infringe the intellectual property rights that made the object of the application or may suspend the clearance operations for such goods, or do both. The goods that are proved to infringe IP rights may be destroyed or offered free of charge to institutions, organisations, etc, under certain conditions, among which is the consent of the IP owner.

5 Competition and abuse of IP rights

What consideration has been given in legislation or case law to competition in the context of IP rights, and in particular to any anticompetitive or similar abuse of IP rights?

According to the Patents Law, in order to remedy a practice determined to be anti-competitive by means of a judicial or administrative procedure, a mandatory licence may be granted for inventions in the field of semiconductor technology.

The Topographies of Semiconductor Products Law provides that a mandatory exploitation licence may be granted by the Bucharest Tribunal to persons who, despite all efforts, did not acquire the right holder’s authorisation to exploit a protected topography, if such a licence is required in emergency situations related to violation of the Competition Law No. 21/1996, as republished.

According to the Plant Varieties Law, the rights conferred by patents for new varieties and their exercise must not violate the legal provisions regulating competition.

Incidental legislation, such as the Government Ordinance No. 52/1997 on the legal regime of franchise, as republished, provides that the franchise agreement must be concluded with the observance of the principle that non-compete clauses are to be included in the agreement in order to protect the know-how. In this sense, in the case of an exclusivity agreement, the franchisor may impose a noncompete clause in order to prevent the transfer of the know-how communicated during the agreement. After termination of the agreement, post-contractual relations between parties must be based on fair competition rules. The franchisor may impose firm obligations on the former beneficiary, thus ensuring the protection of business confidentiality and, in particular, preventing the use of the know-how by competitors.

6 Remedies for deceptive practices

With respect to trademarks, do competition or consumer protection laws provide remedies for deceptive practices in addition to traditional ‘passing off’ or trademark infringement cases?

Law No. 11/1991 on fighting against unfair competition qualifies the following as criminal offences sanctioned by imprisonment or a fine:

• the use of a trademark in such a manner that is likely to create confusion with another trademark lawfully used by a trader;
• the placement on the market of counterfeited products, whose commercialisation adversely affects the holder of the trademark and misleads the consumer with respect to the quality of the product or service; and
• the manufacturing, importation, exportation, storage, offering for sale or selling goods or services bearing false mentions (specifications or indications) regarding trademarks for the purpose of misleading other traders and beneficiaries.

In addition to criminal sanctions, the offender may also be compelled to pay damages for any loss caused.

Regarding consumer protection legislation, Law No. 363/2007 on combating unfair practices of traders in their relations with consumers and the harmonisation of regulations with the European consumer protection legislation, states that any trading activity, including comparative advertising, that creates confusion with another product or with the trademark, name, or other distinctive signs of a competitor, thus determining the average consumer to take a trading decision that he would not otherwise have taken, qualifies as a misleading commercial practice. The authorities may also suspend the trader’s activity until the cessation of the misleading practice, as a complementary sanction.

In addition to the above, it must be noted that misleading advertising is qualified as a minor offence under Law No. 158/2008 on misleading and comparative advertising, and is sanctioned with a fine.

7 Technological protection measures and digital rights management

With respect to copyright protection, is WIPO protection of technological protection measures and digital rights management enforced in your jurisdiction? Does legislation or case law limit the ability of manufacturers to incorporate TPM or DRM protection limiting the platforms on which content can be played? Could TPM or DRM protection be challenged under the competition laws?

The TPMs and DRM are provided under article 1385 of the Copyright Law and may be freely used by the right holders. However, the right holders using such protection measures have the obligation of ensuring the beneficiaries are aware of certain exceptions expressly provided by law (for example, the right to reproduce copyright protected works within judicial, parliamentary or administrative proceedings or for public safety purposes, etc) and the necessary measures that enable the legal access to the works or to any other object of the protection, but retain the right to limit the number of copies made within these conditions.

In the case of the exercise of the right to use TPMs and DRM would violate competition laws, then such might be challenged accordingly.

8 Industry standards

What consideration has been given in legislation or case law to the impact of the adoption of proprietary technologies in industry standards?

The standardisation activity is mainly regulated in Romania under Government Ordinance No. 39/1998 on the national standardisation activity, as approved by Law No. 355/2002. The national standardisation body is the Romanian Standards Association (ASRO), a private legal entity of public interest, organised as a non-profit association and a member of CEN, CENELEC, CEI, ISO and ETSI (it is an observer member of the latter).

One of ASRO’s main functions is to elaborate and approve national standards. Government Ordinance No. 39/1998 does not expressly regulate the adoption of proprietary technologies in industry standards, but provides that ASRO is the owner of the copyright over the national standards and the owner of the trademarks attesting conformity with the national standards.

ASRO is the sole entity authorised to distribute, through selling, the national, European and international standards, and to supervise the respect of copyright over such. Any unauthorised reproduction or copy, distribution of standards, translation or creation of derivative works, without ASRO’s prior written consent, represents a copyright infringement.

Competition

9 Competition legislation

What legislation sets out competition law?

The applicable legislation in the field of competition law consists of Law No. 21/1996 (the Competition Law), together with secondary legislation, including regulations and guidelines issued by the Romanian Competition Council.

Romanian competition legislation has recently undergone significant changes aimed at bringing it in line with EU regulations and the case law of European courts.

The Competition Law was substantially amended through the enactment of Emergency Government Ordinance 75/2010 (EGO 75), which was subsequently modified and approved by Law 149/2011, which entered into force on 15 July 2011. The most significant changes to the Competition Law include:

• self assessment:
• the elimination of the notification system and replacement with the self-assessment procedure in case the conditions for benefiting from a block exemption are not met;
• dominant position:
• a rebuttable presumption of dominance in case the relevant market shares are above 40 per cent;
• merger control:
• the application of the significant impediment of effective competition (SIEC) test for the assessment of the compatibility of an economic concentration with a normal competitive environment;
• the notification of a merger is required prior to implementation (no longer within a certain time period from signing);
• the possibility to notify the concentration on the basis of a good-faith intention to conclude an agreement or a public announcement of the intention to make a public offering; and
• an authorisation fee of between e10,000 and e25,000;
• guarantees for the undertakings:
• express regulation of the legal professional privilege;
• sanctions:
• fines for public administration authorities in cases of procedural infringements of competition rules;
• a reduction of between 10 to 30 per cent of the fine for acknowledgment of the breach; and
• criminal liability may also entail the prohibition to hold a position similar to that used in committing the breach;
• challenge in court:
• the Court of Appeal will only suspend a Competition Council decision on condition of a bail payment, whose amount is to be set by the Court; and
• private enforcement:
• individuals who claim to be harmed due to an anticompetitive practice are entitled to file a request for damages within two years of the date when the legal means for challenging the decision of the Competition Council on which the claim is based are exhausted.

10 IP rights in competition legislation

Does the competition legislation make specific mention of IP rights?

The Competition Law does not make a specific mention of IP rights. The compatibility of agreements involving IP is to be analysed according to the conditions and criteria set by the EU specific regulations (for example, technology transfer).

In the field of merger control, the Romanian Merger Regulation and Guidelines (currently in force) contain several provisions which make specific mention of IP rights, in line with EU provisions. The Romanian Merger Regulation implemented the provision of the EC Consolidated Jurisdictional Notice, according to which a transaction confined to intangible assets such as brands, patents or copyrights may amount to a concentration if those assets constitute a business with a market turnover. In any case, the transfer of licences for brands, patents or copyrights, without additional assets, can only fulfil these criteria if the licences are exclusive at least in a certain territory and the turnover-generating activity is transferred. For nonexclusive licences it can be excluded that they may constitute on their own a business to which a market turnover is attached.

In line with the EU Guidelines on restrictions directly related and necessary to concentration, the Romanian Merger Guidelines provide that non-competition clauses cannot be considered necessary when the transfer is limited to exclusive industrial property rights.

In addition, licences of patents, of similar rights or know-how may be considered necessary to the implementation of the concentration and in any event need not be limited in time.

11 Review and investigation of competitive effect

Which authorities may review or investigate the competitive effect of conduct related to IP rights?

The Romanian Competition Council is competent to review and investigate the competitive effect of conduct related to IP rights.

For the purpose of applying articles 101 and 102 TFEU, the Romanian Competition Council may perform inspections upon the request of the EC or a national competition authority of an EU member state, based on the inspection order issued by the president of the Romanian Competition Council.

12 Competition-related remedies for private parties

Do private parties have competition-related remedies if they suffer harm from the exercise, licensing or transfer of IP rights?

A private party, having suffered harm from the exercise, licensing or transfer of IP rights, may file a complaint with the Romanian Competition Council, the opening of an investigation in such a case being possible provided that the complainant shows a direct and genuine harm caused by the alleged breach of competition rules. Following the investigation, the Romanian Competition Council may order the undertakings concerned to cease their anti-competitive practice, may impose interim measures, accept commitments and impose fines.

Irrespective of the sanctions applied by the competition authorities, the natural or legal persons maintain their right to request in court full indemnification for the damage caused by anti-competitive behaviour. The court may also order temporary measures in urgent cases, by way of injunctions, with the aim of preventing imminent damage that could not be remedied, or preserving a right thatwould be otherwise prejudiced, or for overcoming the difficulties which might occur throughout an enforcement procedure. No such private actions have been filed in Romania so far.

Contractual remedies are also available. Private parties may set aside the contractual terms of agreements involving IP rights that give rise to anti-competitive practices and are prohibited by articles 5 and 6 of the Romanian Competition Law (the equivalent of articles 101 and 102 TFEU) as being void and unenforceable.

13 Competition guidelines

Has the competition authority issued guidelines or other statements regarding the overlap of competition law and IP?

The Romanian Competition Council has not issued specific statements regarding the overlap of competition law and IP. In terms of legislation, agreements involving the transfer of technology are to be assessed by the Romanian Competition Council pursuant to the conditions and criteria set by the EU specific regulations (EC Block Exemption Regulation No. 772/2004 of 27 April 2004 (TTBER)).

14 Exemptions from competition law

Are there aspects or uses of IP rights that are specifically exempt from the application of competition law?

The assessment of vertical agreements containing provisions granting IP rights is performed based on the Vertical Block Exemption Regulation, only when the licensing or assignment of IPRs does not represent the agreement’s core objective and their effect on the market is not similar to the one of non-exempted restrictions. Agreements whose principal objective is the transfer of IPRs will have to comply with the TTBER provisions.