Hello all,
I am soon to be launching an online store selling Automotive Locksmiths supplies to trading Locksmiths.
I have been searching for a good couple of weeks to get some answers to a few questions that I have of which I have been unsuccessful in doing so. Some people have said it's a tough subject that isn't clear in terms of the law and I have even been in contact with Trading Standards & Citizens Advice to no avail.
My concerns are with selling remote vehicle keys and the rules surrounding logo's. So, obviously selling aftermarket remote keys with logos is not allowed, and I understand that. But, what about selling original vehicle keys that are supplied as you would expect, with the logo attached and in place where it should be...
There's a couple of different ways in terms of importing these goods into the UK.
1) Importing original keys, for example Ford remote keys from China with the logo attached and in place as you would expect. This option comes in original manufacturer Chinese Ford packaging.
2) Importing original keys, for example Ford remote keys from China with the logo attached and in place as you would expect. This option comes in a clear bag, not in original packaging.
3) Importing original KIA & Hyundai keys from United Arab Emirates that comes in original manufacturer packaging. This is from the largest Auto Locksmith supplier in the world that has been in contact with me for potential business to business. They are already selling the exact keys explained within this option to locksmiths all over the world.
4) Importing original used keys that may or may not show signs of use. Logo in place as expected. (A lot of 'used' keys can be reused after unlocking).
I understand that in all 3 of the above cases, the logo's can be removed and sold on my web shop without any issues at all, but my question is, can I avoid having to remove the logos with any of the options? I would assume option 2 is no and the logo would need to be removed, not sure about options 1, 3 & 4?
I would appreciate any help on this matter and thank you in advance.
Vehicle Keys & Logo's
Re: Vehicle Keys & Logo's
Hi LGM,
First of all, I should mention that as this issue arises in a business context you should get some advice from a qualified trade mark attorney.
(Details from the Chartered Institute ofTrade Mark Attorneys). What follows is not legal advice; it is information about what the law says.
Next, I need to be clear about your use of the word 'original'. I assume that you mean that the keys are genuine Ford etc keys, made for them but not delivered to them by a sub-contractor/manufacturer. The problem you face is that if you have been deceived by a Chinese manufacturer or some middle man supplier and they are in fact really good copies, of the sort Chinese producers are well known for, then basically you would be dealing in counterfeit goods. Counterfeit keys without any logos and not sold as genuine Ford etc parts which did the job they were designed for are not a problem, legally speaking, just like the myriad of other products such as laptop batteries, battery chargers etc which are not OEM products. You need to do due diligence in checking out the sources of your products which have logos, don't just take someone's word for it because they won't be available as a witness if you get sued. Keep a thorough audit trail.
While writing about preliminaries, it is worth mentioning the special case which exists in trade mark law where a non-genuine part (which is itself perfectly legal) may have the manufacturer's logo attached to it. This mainly concerns the car industry. Where a look-a-like replacement part must for aesthetic reasons match the original part, and that part includes the manufacturer's trade mark, then it is permissible for the replacement to include the trade mark also. The classic example is hubcaps. However this exception only applies where it is necessary for the part to look the same in all details. The UK law for this is found in section 11(2)(c) of the Trade Marks Act 1994. There is plenty of case law on this particular topic, and based on those court decisions, I think it is highly unlikely that the use of a trade mark logo on an aftermarket (ie non-genuine) key/keyfob, would meet the criterion of 'necessary'.
Finally under the heading of preliminaries, it is worth mentioning that trade mark infringement covers not only the advertising and selling of goods bearing an infringing trade mark, it also covers importing and stocking such goods, whether or not they have been offered or will be offered, for sale in the relevant country. There are special rules for goods which may be infringing goods but which are in transit to a third country, but that doesn't arise here. And for the sake off completeness, and to reinforce my first point about getting proper legal advice, trade mark infringement can sometimes be treated as a criminal offence (see section 92 TMA). What distinguishes grounds for a criminal charge is the motivation and knowledge of the alleged infringer at the time of the 'offence'. It is a defence to a criminal charge that the defendant reasonably believed that the goods were not infringing items; there is no such defence to a civil claim(1).
With those caveats in mind let's look at your four scenarios.
1. If a key is a genuine manufacturer's product in the manufacturer's genuine packaging, and the only difference is that it is intended for a different market, then this is what is known as a parallel import (sometimes referred to as a grey import). As such they then come under some complicated rules which were formulated under EU law but which still apply to a certain extent in UK law. The EU law is Regulation (EU) 2017/1001 and the relevant part is Article 9 (4) which says:
2. From the answer to question one it follows that if the only difference is the packaging, and the actual key is already on authorised sale within the EU or Britain, then importing the key and selling it in the UK does not infringe. Furthermore it would be legal to sell the keys as genuine Ford keys, provided that you were completely sure that they were genuine Ford parts.
3. The answer here is essentially the same as in 1 and 2. If Auto Locksmith have been distributing or importing keys into an EU member state or the Britain with authority from Kia and Hyundai etc then you can legally import them into Britain, provided that the OEM packaging is the same in all cases.
4. Where second hand goods are concerned, in general the rights of the trade mark owner are said to be exhausted after the first (authorised) sale of the item concerned. Since there is no original packaging involved, it is irrelevant whether the first sale occurred in the UK or elsewhere. The genuine second hand key can be advertised and sold as a genuine part and the only stipulation is that it must not be advertised as new. There is an entirely separate Sale of Goods Act issue about the quality and functionality of the re-furbished key such that you would effectively become responsible for any liability if the key failed to function as intended. Simply put any warranty which may have existed in the key will probably have been voided by the unlocking process.
I hope that clarifies things a little. That said, it is a complicated area, and even if the law appears to allow you to do something, that doesn't necessarily mean that a large company will be deterred from using heavy handed tactics to try and shut down activities it disapproves of or which it thinks might undermine its brand reputation.
Notes.
1. If you would like a bit more in depth analysis of the criminal offence of trade mark infringement see this House of Lords judgment from 2003.
2. I have used the word Britain rather than UK deliberately as for some purposes Northern Ireland is still treated as being subject to EU trading rules (hence the Northern Ireland Protocol) . It isn't necessary to go into detail on this here, unless of course your business is based in Northern Ireland. If it is, you need to get some specialist legal advice from a solicitor based in the Province who also has intellectual property law expertise.
3. A practice has sprung up, especially in the pharmaceutical market, whereby products are relabelled to comply with the domestic regulations etc of the new target marketplace prior to being parallel imported. The legality of this practice was tested in the Court of Justice of the European Union in a case known as Bristol-Myers Squibb v Paranova. In this case the CJEU ruled that relabelling (ie affixing a new label to existing packaging) was permissible provided that certain steps, known as the BMS criteria, were satisfied:
First of all, I should mention that as this issue arises in a business context you should get some advice from a qualified trade mark attorney.
(Details from the Chartered Institute ofTrade Mark Attorneys). What follows is not legal advice; it is information about what the law says.
Next, I need to be clear about your use of the word 'original'. I assume that you mean that the keys are genuine Ford etc keys, made for them but not delivered to them by a sub-contractor/manufacturer. The problem you face is that if you have been deceived by a Chinese manufacturer or some middle man supplier and they are in fact really good copies, of the sort Chinese producers are well known for, then basically you would be dealing in counterfeit goods. Counterfeit keys without any logos and not sold as genuine Ford etc parts which did the job they were designed for are not a problem, legally speaking, just like the myriad of other products such as laptop batteries, battery chargers etc which are not OEM products. You need to do due diligence in checking out the sources of your products which have logos, don't just take someone's word for it because they won't be available as a witness if you get sued. Keep a thorough audit trail.
While writing about preliminaries, it is worth mentioning the special case which exists in trade mark law where a non-genuine part (which is itself perfectly legal) may have the manufacturer's logo attached to it. This mainly concerns the car industry. Where a look-a-like replacement part must for aesthetic reasons match the original part, and that part includes the manufacturer's trade mark, then it is permissible for the replacement to include the trade mark also. The classic example is hubcaps. However this exception only applies where it is necessary for the part to look the same in all details. The UK law for this is found in section 11(2)(c) of the Trade Marks Act 1994. There is plenty of case law on this particular topic, and based on those court decisions, I think it is highly unlikely that the use of a trade mark logo on an aftermarket (ie non-genuine) key/keyfob, would meet the criterion of 'necessary'.
Finally under the heading of preliminaries, it is worth mentioning that trade mark infringement covers not only the advertising and selling of goods bearing an infringing trade mark, it also covers importing and stocking such goods, whether or not they have been offered or will be offered, for sale in the relevant country. There are special rules for goods which may be infringing goods but which are in transit to a third country, but that doesn't arise here. And for the sake off completeness, and to reinforce my first point about getting proper legal advice, trade mark infringement can sometimes be treated as a criminal offence (see section 92 TMA). What distinguishes grounds for a criminal charge is the motivation and knowledge of the alleged infringer at the time of the 'offence'. It is a defence to a criminal charge that the defendant reasonably believed that the goods were not infringing items; there is no such defence to a civil claim(1).
With those caveats in mind let's look at your four scenarios.
1. If a key is a genuine manufacturer's product in the manufacturer's genuine packaging, and the only difference is that it is intended for a different market, then this is what is known as a parallel import (sometimes referred to as a grey import). As such they then come under some complicated rules which were formulated under EU law but which still apply to a certain extent in UK law. The EU law is Regulation (EU) 2017/1001 and the relevant part is Article 9 (4) which says:
Put in simple terms, unless the trade mark owner has already made the exact goods including packaging available within an EU Member state, he can prevent the importation and sale of similar (genuine) goods which bear his trade mark which are available in another market, from being imported and sold within the EU. Because of Brexit (2) this situation is in the process of being updated but as at today, the only change is that EU member states no longer recognise that the authorised sale of goods in the UK provides lawful grounds for the same goods to be parallel imported into an EU member country. On the other hand Britain has not amended its rules, meaning that if Ford etc had authorised the importation of genuine keys in Chinese packaging to any EU member state then importing the same goods into the UK would be lawful and Ford etc could not object. There are special rules, developed out of case law, covering the re-labelling of goods - see note 3.Without prejudice to the rights of proprietors acquired before the filing date or the priority date of the EU trade mark, the proprietor of that EU trade mark shall also be entitled to prevent all third parties from bringing goods, in the course of trade, into the Union without being released for free circulation there, where such goods, including packaging, come from third countries and bear without authorisation a trade mark which is identical with the EU trade mark registered in respect of such goods, or which cannot be distinguished in its essential aspects from that trade mark.
2. From the answer to question one it follows that if the only difference is the packaging, and the actual key is already on authorised sale within the EU or Britain, then importing the key and selling it in the UK does not infringe. Furthermore it would be legal to sell the keys as genuine Ford keys, provided that you were completely sure that they were genuine Ford parts.
3. The answer here is essentially the same as in 1 and 2. If Auto Locksmith have been distributing or importing keys into an EU member state or the Britain with authority from Kia and Hyundai etc then you can legally import them into Britain, provided that the OEM packaging is the same in all cases.
4. Where second hand goods are concerned, in general the rights of the trade mark owner are said to be exhausted after the first (authorised) sale of the item concerned. Since there is no original packaging involved, it is irrelevant whether the first sale occurred in the UK or elsewhere. The genuine second hand key can be advertised and sold as a genuine part and the only stipulation is that it must not be advertised as new. There is an entirely separate Sale of Goods Act issue about the quality and functionality of the re-furbished key such that you would effectively become responsible for any liability if the key failed to function as intended. Simply put any warranty which may have existed in the key will probably have been voided by the unlocking process.
I hope that clarifies things a little. That said, it is a complicated area, and even if the law appears to allow you to do something, that doesn't necessarily mean that a large company will be deterred from using heavy handed tactics to try and shut down activities it disapproves of or which it thinks might undermine its brand reputation.
Notes.
1. If you would like a bit more in depth analysis of the criminal offence of trade mark infringement see this House of Lords judgment from 2003.
2. I have used the word Britain rather than UK deliberately as for some purposes Northern Ireland is still treated as being subject to EU trading rules (hence the Northern Ireland Protocol) . It isn't necessary to go into detail on this here, unless of course your business is based in Northern Ireland. If it is, you need to get some specialist legal advice from a solicitor based in the Province who also has intellectual property law expertise.
3. A practice has sprung up, especially in the pharmaceutical market, whereby products are relabelled to comply with the domestic regulations etc of the new target marketplace prior to being parallel imported. The legality of this practice was tested in the Court of Justice of the European Union in a case known as Bristol-Myers Squibb v Paranova. In this case the CJEU ruled that relabelling (ie affixing a new label to existing packaging) was permissible provided that certain steps, known as the BMS criteria, were satisfied:
- Enforcement of the trade mark would contribute to the artificial partitioning of the markets between Member States.
- The repackaging does not affect the original condition of the product inside the packaging.
- The new packaging complies with certain criteria, eg it clearly states who repackaged the product and the name of the manufacturer.
- The presentation of the repackaged product does not damage the reputation of the trade mark.
- The importer gives advance notice to the trade mark owner before sale (and on demand, provides a specimen).
Advice or comment provided here is not and does not purport to be legal advice as defined by s.12 of Legal Services Act 2007
Re: Vehicle Keys & Logo's
Hello Andy,
NOTE* I will be making contact with a qualified trade mark attorney in the coming days
Thank you ever so much for your detailed response, I really appreciate it!
Looking further into things and taking into account your valued information, the conclusions that I have come to, in the simplest terms possible are as follows;
- I can import used original keys of any brand and resell them on my web shop with branding in place, but I must not list them as 'New.
My question regarding this;
I do not currently list any of my items as New, Used, Reconditioned or anything alike. In fact, no suppliers in this field actually do this. So, do I even need to state anything as such? Or must I state that it is 'Used' (?)
- Further to your information on whether or not such companies have been given permission for example to sell KIA & Hyundai keys to Auto Locksmiths here in the UK, this is already happening on a very large scale. I am apart of the main network for Auto Locksmiths in the UK and the company I speak of as a potential supplier to me is already supplying thousands of original KIA & Hyundai keys to Auto Locksmiths in the UK and I am actually one of them for when I do my own jobs. This would indicate that it is perfectly legal from their end at least.
- Importing any original keys from China or alike without original packaging etc is a no I think. I would need to remove the logo's from the keys before listing them up for sale.
NOTE* I will be making contact with a qualified trade mark attorney in the coming days
Thank you ever so much for your detailed response, I really appreciate it!
Looking further into things and taking into account your valued information, the conclusions that I have come to, in the simplest terms possible are as follows;
- I can import used original keys of any brand and resell them on my web shop with branding in place, but I must not list them as 'New.
My question regarding this;
I do not currently list any of my items as New, Used, Reconditioned or anything alike. In fact, no suppliers in this field actually do this. So, do I even need to state anything as such? Or must I state that it is 'Used' (?)
- Further to your information on whether or not such companies have been given permission for example to sell KIA & Hyundai keys to Auto Locksmiths here in the UK, this is already happening on a very large scale. I am apart of the main network for Auto Locksmiths in the UK and the company I speak of as a potential supplier to me is already supplying thousands of original KIA & Hyundai keys to Auto Locksmiths in the UK and I am actually one of them for when I do my own jobs. This would indicate that it is perfectly legal from their end at least.
- Importing any original keys from China or alike without original packaging etc is a no I think. I would need to remove the logo's from the keys before listing them up for sale.
Re: Vehicle Keys & Logo's
Thanks for the update.
As you will be getting legal advice on your specific needs and intentions shortly I won't comment on your proposed plan of action here. A public forum cannot provide tailored legal advice and it would be unethical to try and provide you with that. However I hope you now have a broad understanding of the law and so you will be able to get the most out of your discussion with your legal advisor.
As you will be getting legal advice on your specific needs and intentions shortly I won't comment on your proposed plan of action here. A public forum cannot provide tailored legal advice and it would be unethical to try and provide you with that. However I hope you now have a broad understanding of the law and so you will be able to get the most out of your discussion with your legal advisor.
Advice or comment provided here is not and does not purport to be legal advice as defined by s.12 of Legal Services Act 2007