[email protected] COMMERCIAL LAW
Ownership – by shareholders evidenced by shares of stock held
Transfer of ownership – shares normally transferred at will of shareholder. Consent of corporation or other shareholders not necessary
By Marek Salamonowicz, Ph.D.
Chair of Commercial Law
University of Warmia and Mazury
General Parntership
Definition
is the body of law that governs business organizations and commercial transactions.
By individual partners in proportions agreed
Partnership interest may be transferred at will of partner but assignee does not become a partner unless all partners agree.
Capital Companies and Partnerships
Corporation
Liability of owners – shareholder has no personal liability for corporate obligations; only risk is loss of investment
Management – by board of directors and officers acting under it; shareholders generally limited to voting in election of directors
General partnership
All partners personally liable for partnerships obligations; liability not limited to investment in parntership
All partners have right to manage the business; each is the agent of partnership and of his or her copartners
Registered Partnership
Sensu stricto - part of civil law.
Sensu largo – industrial property law, unfair trade practices, competition law, etc.
Capital Companies and Partnerships
Corporation
Entity – A separate legal entity and taxed as such
Creation – created by the state upon application in required legal form; evidenced by charter or articles of incorporation Duration – Perpetual corporate life
General Partnership
Not a legal entity but has certain characteristics of one.
Created by formal agreement of its members
Life limited to term set by partnership agreement
Capital Companies and Partnerships
Corporation
Creation of a partneship.
Partnership assets.
Profits and losses partition.
Civil liability for partnerships’ debts.
Companies’ representation.
Withdrawal from a partnership.
4) the term of the partnership, if it is specified.
Partnership assets
Dissolution and dissolvation of company.
any property contributed to the partnership
acquired by the partnership in the course of its existence.
Non-compete obligation
[Contributions of partners]
Creation of a company
In case of doubt, the contributions of the partners shall be deemed to be equal.
The partner may make the contribution by transferring or encumbering the right of ownership of things or other rights, and by providing other performances to the partnership.
3) the objects of the partnership,
[Form of articles] The articles of association shall be made in writing, or else they shall be invalid. [Business name] The business name of the registered partnership shall include the surnames or business names of all the partners, or the surname or the business name of one or several partners and the additional words (“registered partnership").
shall be created upon its registration in the register.
The articles of association of the registered partnership
Each partner shall be entitled to an equal share in the profits and shall participate in the losses in the same proportion, irrespective of the type and value of the contribution.
A partner's share in the profits defined in the articles of association shall also apply, in case of doubt, to his share in the losses.
The articles of association may release a partner from participation in losses.
1) the business name and the seat of the partnership,
2) the description of the contributions made by each of the partners and their value,
Profits and losses partition
A partner may request that the entire profits be divided and distributed at the end of each financial year.
Capital share
The capital share of the partner shall equal the value of the contribution effectively made.
A partner may demand every year a 5% interest on that partner's capital share, even if the partnership has sustained a loss.
Civil liability for partnerships’ debts
Each partner shall be liable for the obligations of the partnership without limitation with all his assets jointly and severally with the remaining partners and the partnership.
(subsidiary liability of the partner) A creditor of the partnership may conduct execution from the partner’s assets where execution from the assets of the partnership proves ineffective.
1) Unlimited; 2) Joint and several; 3) Personal; 4) Direct; 5) Subsidary
Partnerships’ representation
Each partner have the right to represent the partnership.
The right of the partner to represent the partnership shall include all acts in court and out of court.
May not be limited with effect towards third parties.
(Way of representation) singly, independently or only together with another partner or agent.
[Deprivaton of right to represent]
1) The articles of association
2) only for significant reasons under a final and non-appealable court judgement.
Management of affairs of partnership
Each partner shall have the right and obligation to manage the affairs of the partnership.
Each partner may, without a prior resolution of the partners, manage the affairs within the ordinary business of the partnership.
a resolution of the partners is required, the unanimity of all partners who have the right to manage the affairs of the partnership shall be required.
Management of affairs of partnership
[Matters outside ordinary course of business] the consent of all partners shall be required, including those who are excluded from managing the affairs of the partnership. [Urgent action] The partner who has the right to manage the affairs of the partnership may, without a resolution of the partners, effect an urgent action, where a failure to effect such action could cause serious damage to the partnership.
Withdrawal from a partnership.
[Transfer of partner’s rights and obligations]
All rights and obligations of a partner in a partnership may be transferred to another person
1) only where the articles of association so provide
2) only after the written consent of all of the remaining partners has been obtained
[Consequences]
the withdrawing partner and the acceding partner shall be jointly and severally liable for the obligations of the withdrawing partner arising in connection with his membership of the partnership and for the obligations of the partnership.
Dissolution and dissolvation of partnership
1) the reasons set out in the articles of association,
2) an unanimous resolution of all partners,
3) a declaration of bankruptcy of the partnership,
4) the death of the partner or declaration of his bankruptcy,
5) termination of the articles of association by a partner or a creditor of a partner,
6) a final and non-appealable court judgement.
The partner may not, without the express or implied consent of the remaining partners, engage in a competitor business, in particular participate in a competitor company as a partner in a civil law partnership, registered partnership, professional partnership, a general partner or a member of a company governing body.
Sanctions
[Sanctions] Each partner may demand the release to the partnership of the benefits received by a partner in breach of the prohibition on competition or claim redress of damage caused to the partnership.
Liquidation
[Actions] The liquidators shall close the current business of the partnership, collect the receivables, perform the obligations and liquidate the assets of the partnership.
New business can be transacted only where this is necessary to close the business in progress.
The assets of the partnership shall be used first of all to pay the obligations of the partnership; an appropriate amount shall be left for repayment of immature and disputed obligations
Liquidation
The remaining assets shall be divided among the partners in accordance with the provisions of the articles of association.
The shares shall be repaid to the partners.
Non-compete obligation
A partner shall refrain from any activity which is in conflict with the interests of the partnership.
Any surplus shall be divided among the partners in the proportion in which they participate in the profit.
Professional Partnership
Responsibility
A professional partnership is a partnership created by partners for the purpose of pursuing a profession in a partnership which operates a business under its own business name.
The articles of association may provide that one or more partners agree to be liable as a partner of a registered partnership
Representation
Each partner shall have the right to represent the partnership individually, unless the articles of association provide otherwise.
The articles of association of a professional partnership may provide that the management of the affairs and the representation of the partnership be entrusted to the management board.
Loss of professional qualifications
In the event that a partner have lost the right to pursue the profession, he shall withdraw from the partnership at the latest at the end of the financial year in which he lost the right to pursue the profession.
LIMITED PARTNERSHIP società in accomandita semplice sociedad en comandita
A limited partnership is a partnership whose purpose is to operate a business under its own business name,
(the general partner) at least one partner of which is liable to the creditors for the obligations of the partnership without limitation
The partnership may be formed for the purpose of pursuing more than one profession, unless a different law provides otherwise.
Partners
Only natural persons qualified to pursue professions may become partners in the partnership.
advocate, pharmacist, architect, civil engineer, auditor, insurance broker, tax adviser, stock broker, investment adviser, accountant, physician, dentist, veterinary doctor, notary, nurse, midwife, legal adviser, patent attorney, property appraiser and sworn translator.
Responsibility
A partner shall not be liable
for the obligations of the partnership which arise in connection with the pursuit by the remaining partners of the profession in the partnership,
for the obligations of the partnership which arise as a result of acts or omissions of persons employed by the partnership under an employment contract or another legal relationship who have been guided by another
partner in the provision of services connected with the objects of the partnership.
(the limited partner) the liability of at least one partner is limited.
[Contribution of limited partner]
If the contribution of the limited partner to the partnership consists in whole or in part of a non-pecuniary performance, the articles of association shall define the object of that performance (in-kind contribution), its value, as well as the partner making such non-pecuniary contribution.
Contributions
The obligation to provide work or services for the benefit of the partnership and the remuneration for the services provided upon the formation of the partnership
may not represent the limited partner's contribution to the partnership, unless the value of his other contributions to the partnership is not lower than the commendam sum.
Liability
(commendam sum) - the amount up to which each of the limited partners is liable vis-a-vis the creditors.
The limited partner shall be liable for obligations of the partnership vis-a-vis its creditors only up to the commendam sum.
The partnership shall be represented by the general partners, who are not deprived of the right to represent the partnership under the articles of association or a final and nonappealable court judgement.
[Limited partner as attorney in fact]
A limited partner may represent the partnership only as an attorney in fact.
Managing affairs of partnership
A limited partner shall not have the right or obligation to manage the affairs of the partnership, unless the articles of association provide otherwise.
The consent of the limited partner shall be required in matters which fall outside the ordinary course of business of the partnership, unless the articles of association provide otherwise.
Participation in profits and losses
A limited partner shall participate in the profits of the partnership proportionately to his contribution actually made to the partnership, unless the articles of association provide otherwise.
The profit shall be used first of all to supplement his contribution actually made up to the value of the agreed contribution.
In case of doubt, a limited partner shall participate in the loss only up to the value of the agreed contribution.
Limited Liability Company
[Contribution and liability]
The limited partner shall be free from liability to the extent of the value of the contribution contributed to the partnership.
Representation
A limited liability company may be incorporated by one or more persons for any purpose allowed by law. The shareholders shall not be liable for the obligations of the company.
[Share capital]
The share capital of the company shall be divided into shares of equal or nonequal nominal value.
Creation
1) the conclusion of the articles of association,
2) the making by the shareholders of contributions to finance the entire share capital, and where the share is subscribed for a price higher than the nominal value, also contributing of the balance,
3) the appointment of the management board,
4) the constitution of the supervisory board or the audit committee if this is required by the law or by the articles of association,
6) the term of the company, if it is defined.
The articles of association shall be made in the form of a notarial deed.
[Company in organisation]
Upon conclusion of the articles of association, a limited liability company in organisation shall be created. It is an legal subject - entrepreneur.
The company in organisation shall be represented by the management board or by an attorney in fact appointed by a unanimous resolution of the shareholders.
Equal and indivisable
The articles of association shall determine whether a shareholder may have one or more shares. If the shareholder may have more than one share, all shares in the share capital shall be equal and indivisible.
Shares in-kind contributions
If the value of in-kind contributions has been considerably inflated in relation to their sale value
the shareholder who made such a contribution and members of the management board who, knowing this, filed the company in the register, shall be jointly and severally liable to make good the outstanding balance to the company.
5) the registration in the register.
Creation – the articles of association
1) the name and seat of the company,
2) the objects of the company,
3) the amount of the share capital,
4) whether or not the shareholder may have more than one share,
Recurrent non-pecuniary performances
5) the number and nominal value of the shares subscribed for by individual shareholders,
If a shareholder is to be obligated to provide recurrent non-pecuniary performances, the articles of
association shall stipulate the type and the scope of such performances.
Remuneration shall be paid
Additional contributions
The articles of association may obligate the shareholders to make additional contributions up to a certain specified amount in proportion to the share.
Transfer
A transfer of the share, its part or a fraction of the share shall be effected in writing with signatures certified by a notary.
The articles of association may stipulate that a transfer of the share, its part or a fraction of the share shall be subject to the consent of the company or otherwise restricted.
The right to participation in the division of assets in the event of liquidation of the company.
Such privileges in respect of the right to vote may attach only to shares of equal nominal value.
privileged dividends
Each preference share which is a preference share as regards dividends may give entitlement to dividends larger by not more than half than the dividend payable on non-preference shares
Management Board
shall manage the affairs of the company and represent the company.
shall include one or more members.
The members of the management board may be drawn from among the shareholders or other persons.
A member of the management board shall be appointed and dismissed by a resolution of the shareholders.
Representation
If the management board comprises several members, representations in the name of the company may be made by two members of the management board acting jointly or by one member of the management board acting together with a holder of the commercial power of attorney.
Shareholder’s right to control
The right to control shall be enjoyed by each shareholder.
For this purpose, a shareholder may at any time inspect the books and
Share register
The management board shall keep a share register where the surname and first name or the business name and the seat of each shareholder, the address, the number and the nominal value of his shares and the creation of the pledge or usufruct and the exercise of the right to vote by the pledgee or the holder of the right of usufruct shall be entered, together with all changes of the shareholders and their respective shares.
Preference (Privileged) shares
Such privileges may concern in particular:
the right to vote,
the right to dividends
documents of the company, draw up a balance sheet for his use or request explanations from the management board.
Refusal
The management board may refuse to give explanations to the shareholder or provide the company books and documents for inspection, if there exists a justified concern that the shareholder may use them for purposes contrary to the interests of the company and as a result may cause material damage to the company.
Supervisory board
The articles of association may create a supervisory board or an audit committee or both.
General meeting
1) consideration and approval of the management board report on the operations of the company, the financial report for the previous financial year and the granting of approval of the performance of duties by the members of the company governing bodies, 2) decisions on claims for redress of damage caused upon formation of the company or its management or supervision, 3) disposal of or tenancy of the enterprise or its organised part and the creation of a limited right in rem over them, 4) acquisition and disposal of real estate, the right of perpetual usufruct, or a share in real estate, unless the articles of association provide otherwise,
Ordinary general meeting
The supervisory board shall consist of at least three members appointed and dismissed by a resolution of the shareholders.
The ordinary general meeting shall be held within six months of the end of each financial year.
Tasks
The supervisory board shall exercise permanent supervision over all areas of the activities of the company.
1) consideration and approval of the management board report on the operations of the company and of the financial report for the previous financial year,
The supervisory board shall not have the right to give the management board any binding instructions with respect to the management of the affairs of the company.
In order to perform its duties, the supervisory board may review all company documents, request reports and explanations from the management board and the employees, and review the state of the company's assets.
Shall have on its agenda:
2) adoption of a resolution on division of profits or financing of losses 3) granting approval of the performance of duties by the members of the company governing bodies.
Action for annulment of resolution
A resolution of the shareholders which contravenes the articles of association or good practices, and harms the interests of the company or is aimed at harming a shareholder
may be challenged in an action brought against the company for an annulment of the resolution.
Public and private limited-liability companies may promote the formation of a holding SE
Action for declaration of invalidity of resolution
The shareholders may bring an action against the company for a declaration of the invalidity of a resolution of the shareholders which is contrary to the law
Companies and firms within the meaning of the second paragraph of Article 54 of the Treaty may form a subsidiary SE by subscribing for its shares
European public limited-liability company (Societas Europaea or SE) by Marek Salamonowicz Main features 1496 SE’s established 11 November 2012 have legal personality, SE shall acquire legal personality on the date on which it is registered The capital of an SE shall be divided into shares. The subscribed capital shall not be less than EUR 120000. Employee involvement Directive 2001/86/EC
Conversion of an existing public limited-liability company into an SE Formation by merger provided that at least two of public limited liability companies are governed by the law of different Member States. the procedure for merger by acquisition - the acquiring company shall take the form of an SE when the merger takes place. the procedure for merger by the formation of a new company - the SE shall be the newly formed company. Formation of a holding SE Public and private limited-liability companies
Examples: Allianz SE, Porsche Automobil Holding SE, BASF SE, STRABAG SE, MAN SE
Transnational aspect - at least two of them: (a) is governed by the law of a different Member State, or (b) has for at least two years had a subsidiary company governed by the law of another Member State or a branch situated in another Member State.
Creation of SE
Further info’s
Public limited-liability companies may form an SE by means of a merger
Company promoting formation shall continue to exist
No shareholder shall be liable for more than the amount he has subscribed
The management or administrative organs of the companies which
promote such an operation shall draw up draft terms for the formation of the holding SE. report explaining and justifying the legal and economic aspects of the formation and indicating the implications for the shareholders and for the employees of the adoption of the form of a holding SE. Further info’s The draft terms shall fix the minimum proportion of the shares in each of the companies promoting the operation which the shareholders must contribute to the formation. That proportion shall be shares conferring more than 50 % of the permanent voting rights. Formation of a subsidiary SE Companies or firms formed in accordance with the law of a Member State and having their registered office, central administration or principal place of business within the Community shall, be treated in the same way as natural persons who are nationals of Member States. ‘Companies or firms’ means companies or firms constituted under civil or commercial law, including cooperative societies, and other legal persons governed by public or private law, save for those which are nonprofit-making. Conversion of an existing public limited-liability company into an SE A public limited-liability company, formed under the law of a Member State, which has its registered office and head office within the Community
may be transformed into an SE if for at least two years it has had a subsidiary company governed by the law of another Member State STRUCTURE OF THE SE SE shall comprise: (a) a general meeting of shareholders and (b) a supervisory organ and a management organ (two-tier system) an administrative organ (one-tier system) depending on the form adopted in the statutes. Two-tier system The management organ shall be responsible for managing the SE. A managing director or managing directors shall be responsible for the current management under the same conditions as for public limitedliability companies that have registered offices within that Member State's territory. The member or members of the management organ shall be appointed and removed by the supervisory organ. Supervisory organ No person may at the same time be a member of both the management organ and the supervisory organ of the same SE. The supervisory organ shall supervise the work of the management organ. It may not itself exercise the power to manage the SE.
The members of the supervisory organ shall be appointed by the general meeting. Further info’s may require the management organ to provide information of any kind which it needs to exercise supervision shall elect a chairman from among its members The management organ shall report to the supervisory organ at least once every three months on the progress and foreseeable development of the SE's business. The one-tier system The administrative organ shall manage the SE. A managing director or managing directors shall be responsible for the day-to-day management The member or members of the administrative organ shall be appointed by the general meeting. The administrative organ shall meet at least once every three months at intervals laid down by the statutes to discuss the progress and foreseeable development of the SE's business. Each member of the administrative organ shall be entitled to examine all information submitted to it. The administrative organ shall elect a chairman from among its members. Rules common to the one-tier and two-tier systems Members of company organs shall be appointed for a period laid down in the statutes not exceeding six years.
quorums and decision-taking in SE organs shall be as follows: (a) quorum: at least half of the members must be present or represented; (b) decision-taking: a majority of the members present or represented. General meeting An SE shall hold a general meeting at least once each calendar year, within six months of the end of its financial year. General meetings may be convened at any time by the management organ, the administrative organ, the supervisory organ or any other organ or competent authority in accordance with the national law. General meeting One or more shareholders who together hold at least 10 % of an SE's subscribed capital may request the SE to convene a general meeting and draw up the agenda therefor. Amendment of an SE's statutes shall require a decision by the general meeting taken by a majority which may not be less than two thirds of the votes cast. EU Competition Law by dr Marek Salamonowicz Cartels prohibition The following shall be prohibited as incompatible with the common market: 1) all agreements between undertakings,
2) decisions by associations of undertakings 3) concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market Types of cartels (a) directly or indirectly fix purchase or selling prices or any other trading conditions; (b) limit or control production, markets, technical development, or investment; (c) share markets or sources of supply; (d) apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; (e) make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts. Sanctions Any agreements or decisions prohibited shall be automatically void. Fines: up to 10 % of annual income. Temporary fines Leniency program Exemption possibility Those agreements which:
1) contributes to improving the production or distribution of goods or to promoting technical or economic progress, 2) while allowing consumers a fair share of the resulting benefit, Which does not: (a) impose on the undertakings concerned restrictions which are not indispensable to the attainment of these objectives; (b) afford such undertakings the possibility of eliminating competition in respect of a substantial part of the products in question. Some cases economic factors ICI Whitebread/Moosehead Hilty Autoglass cartel / Saint Gobain / Pilkington Michelin/Continental IMAX AstraZeneca Market position of parties and its competitors and buyers, entry barriers, maturity of the market Abuse of dominant position Any abuse by one or more undertakings of a dominant position within the common market or in a substantial part of it shall be prohibited as incompatible with the common market in so far as it may
affect trade between Member States. Art. 102 TFEU
(2009/C 45/02)
1) geographical
Communication from the Commission — Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings
2) assortiment
The assessment of dominance
3) time (Christmas, All Saints, Valentine’s Day, Halloween)
will take into account the competitive structure of the market, and in particular the following factors:
Porto di Genova, United Brands, Tetra Pack, Hilti, Relevant market
Unilateral, soly act on the market – rise prices, market power Abuse of dominant position may consist in: Predatory pricing (a) directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions; contingent (b) limiting production, markets or technical development to the prejudice of consumers; Contractual discrimination (c) applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; Forms of abusement Tie-in and tie-out (d) making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.
— constraints imposed by the existing supplies from, and the position on the market of, actual competitors (the market position of the dominant undertaking and its competitors) — constraints imposed by the credible threat of future expansion by actual competitors or entry by potential competitors (expansion and entry) — constraints imposed by the bargaining strength of the undertaking's customers (countervailing buyer power) Definition Dominance has been defined under Community law as a position of economic strength enjoyed by an undertaking, which enables it to prevent effective competition being maintained on a relevant market, by affording it the power to behave to an appreciable extent independently of its competitors, its customers and ultimately of consumers. This notion of independence is related to the degree of competitive
Procedures
The competition authorities of the Member States shall have the power to apply Articles 81 and 82 of the Treaty in individual cases.
EC Regulation 1/2003
Decisions
Agreements, decisions and concerted practices caught by Article 81(1), which do not satisfy the conditions of Article 81(3) shall be prohibited, no prior decision to that effect being required.
Acting on their own (Member States’ competition authorities) initiative or on a complaint, they may take the following decisions:
constraint exerted on the undertaking in question.
the burden of proving an infringement of prohibition, shall rest on the party or the authority alleging the infringement. The entity claiming the benefit of exemption shall bear the burden of proving that the conditions of that are fulfilled. Further Info’s Where the competition authorities of the Member States or national courts apply national competition law to practices which may affect trade between Member States, they shall also apply Article 81 of the Treaty to such practices. Where the competition authorities of the Member States or national courts apply national competition law to any abuse prohibited by Article 82 of the Treaty, they shall also apply Article 82 of the Treaty. Powers For the purpose of applying Articles 81 and 82 of the Treaty, the Commission shall have the powers provided for by this Regulation.
— requiring that an infringement be brought to an end, — ordering interim measures Decisions — accepting commitments, — imposing fines, periodic penalty payments or any other penalty provided for in their national law. Where on the basis of the information in their possession the conditions for prohibition are not met they may likewise decide that there are no grounds for action on their part. Powers of national courts National courts shall have the power to apply Articles 81 and 82 of the Treaty. Private enforcement Damages actions for breach of the EC antitrust rules Commission White Paper: to draw up a framework with pragmatic, nonbinding guidance for quantification of damages in antitrust cases, e.g. by means of approximate methods of calculation or simplified rules on estimating the loss.
Finding and termination of infringement Where the Commission, acting on a complaint or on its own initiative, finds that there is an infringement of Art 81 or of Art 82 of the Treaty, it may by decision require the undertakings and associations of undertakings concerned to bring such infringement to an end. Commission may impose on them any behavioural or structural remedies which are proportionate to the infringement committed and necessary to bring the infringement effectively to an end. Structural remedies can only be imposed either where there is no equally effective behavioural remedy or where any equally effective behavioural remedy would be more burdensome for the undertaking concerned than the structural remedy. If the Commission has a legitimate interest in doing so, it may also find that an infringement has been committed in the past Interim measures In cases of urgency due to the risk of serious and irreparable damage to competition, the Commission, acting on its own initiative may by decision, on the basis of a prima facie finding of infringement, order interim measures. Commitments Where the Commission intends to adopt a decision requiring that an infringement be brought to an end and the undertakings concerned offer commitments to meet the concerns expressed to them by the Commission in its preliminary assessment, the
Commission may by decision make those commitments binding on the undertakings. Such a decision may be adopted for a specified period and shall conclude that there are no longer grounds for action by the Commission. Finding of inapplicability Where the Community public interest relating to the application of Articles 81 and 82 of the Treaty so requires, the Commission, acting on its own initiative, may by decision find that Article 81 of the Treaty is not applicable to an agreement, a decision by an association of undertakings or a concerted practice, either because the conditions of Article 81(1) of the Treaty are not fulfilled, or because the conditions of Article 81(3) of the Treaty are satisfied. Powers of investigation Requests for information Power to take statements The Commission's powers of inspection Powers of inspection If a reasonable suspicion exists that books or other records related to the business and to the subject matter of the inspection, which may be relevant to prove a serious violation of Article 81 or Article 82 of the Treaty, are being kept in any other premises, land and means of transport, including the homes of directors, managers and other members of staff of the undertakings and associations of undertakings concerned, the
Commission can by decision order an inspection to be conducted in such other premises, land and means of transport. The decision shall specify the subject matter and purpose of the inspection, appoint the date on which it is to begin and indicate the right to have the decision reviewed by the Court of Justice. Public aid any aid granted by a Member State or through State resources in any form whatsoever which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods shall, in so far as it affects trade between Member States, be incompatible with the common market. Compatibility with common market (a) aid having a social character, granted to individual consumers, provided that such aid is granted without discrimination related to the origin of the products concerned; (b) aid to make good the damage caused by natural disasters or exceptional occurrences; (c) aid granted to the economy of certain areas of the Federal Republic of Germany affected by the division of Germany. May be compatible (a) aid to promote the economic development of areas where the standard of living is abnormally low or where there is serious underemployment;
(b) aid to promote the execution of an important project of common European interest or to remedy a serious disturbance in the economy of a Member State; (c) aid to facilitate the development of certain economic activities or of certain economic areas,where such aid does not adversely affect trading conditions to an extent contrary to the common interest; (d) aid to promote culture and heritage conservation; (e) such other categories of aid as may be specified by decision of the Council. Industrial property rights in knowledge based economy Marek Salamonowicz Chair of Commercial Law Intangible assets patent for invention utility model industrial design trade mark geographical indication topographies of integrated circuits Know-how (trade secrets) copyrights Global point of view on patent protection International patent filings under WIPO’s Patent Cooperation Treaty
(PCT) grew by 2.4% in 2008, to nearly 164,000 applications. The largest number of international PCT applications, just under a third of the total for 2008 (32.7% or 53,521 applications) were filed by inventors in the United States of America Inventors from the Republic of Korea (+12.0%), China (+11.9%) and Sweden (+12.5%) enjoyed robust growth rates. Inventors and corporations from Japan, with 17.5% (28,774), Germany (18,428), Republic of Korea (7,908) France (6,867), China (6,089), United Kingdom (5,517), Netherlands (4,349), Sweden (4,114), Switzerland (3,832), Canada (2,966), Italy (2,939), Finland (2,119), Australia (2,028) and Israel (1,882). For the first time, a Chinese company topped the list of PCT applicants in 2008. Huawei Technologies Co. Ltd, a major international telecommunications company based in Shenzhen, filed 1,737 PCT applications in 2008. Panasonic Corporation (Japan) was the second largest user of the PCT in 2008 with 1,729 international applications, followed by Koninklijke Philips Electronics N.V. (Netherlands, 1,551 PCT applications), Toyota Jidosha Kabushiki Kaisha (Japan, 1,364 PCT applications) and Robert Bosch GmbH (Germany, 1,273 PCT applications).
Patents shall be granted for any inventions which are new, which involve an inventive step and which are susceptible of industrial application. 1) Novelty - An invention shall be considered to be new if it does not form part of the state of the art. The state of the art shall be held to comprise everything made available to the public by means of a written or oral description, by use, displaying or disclosure in any other way, before the date according to which priority to obtain a patent is determined. Non-obviousness An invention shall be considered as involving an inventive step if, having regard to the state of the art, it is not obvious to a person skilled in the art. Shall not be regarded as inventions (i) discoveries, scientific theories and mathematical methods, (ii) aesthetic creations, (iii) schemes, rules and methods for performing mental acts, doing business or playing games, (iv) creations, whose incapability of exploitation may be proved under the generally accepted and recognised principles of science, (v) programs for computers,
Of the 100 top companies, 38 were from the United States, 28 from Japan and 13 from Germany.
(vi) presentations of information.
Patentable invention
(i) inventions whose exploitation would be contrary to public order or morality; the exploitation shall not be
Patents shall not be granted for:
deemed to be so contrary merely because it is prohibited by law,
an invention but cannot be applied separately (patent of addition).
(ii) plant or animal varieties or essentially biological processes for the production of plants or animals; this provision does not apply to microbiological processes or the products thereof,
A patent of addition may also be obtained for a patent of addition already granted.
(iii) methods for treatment of the human or animal body by surgery or therapy or diagnostic methods applied on human or animal bodies; this provision shall not apply to products, and in particular to substances or compositions applied in diagnostics or treatment. Patent right A patent shall confer the exclusive right to exploit the invention, for profit or for professional purposes, throughout particular territory. The scope of the protection sought shall be determined by the claims contained in the patent specification. The patent specification and drawings may be used to interpret the claims. The term of a patent shall be 20 years counted from the date of filing of the patent application with the Patent Office. Patent right A patent granted for a process of manufacture shall also cover products directly obtained by means of that process. A right holder may obtain a patent for an improvement or an addition to the invention, where such improvement or addition has the characteristics of
Right to exclude others The patent holder shall have the right to prevent any third party not having his consent from exploiting his invention for profit or for professional purposes by way of performing the acts consisting of: (i) making, using, offering, putting on the market a product that is the subject matter of the invention, or importing the product for such purposes, or (ii) employing a process that is the subject matter of the invention, as well as using, offering, putting on the market or importing for such purposes the product directly obtained by that process. Commercialization The patent may be assigned or be subject to succession. The transfer contract shall be in writing on pain of invalidity. The transfer of a patent shall be binding on third parties as from the date of its entry in the Patent Register. The patent holder shall have the right to authorize (license) another party to exploit his invention (license agreement). Licence agreement
In a license contract restricted exploitation of the invention may be provided for (restricted license). Unless the license contract provides for the restricted exploitation of the invention, the licensee shall have the right to exploit the invention to the same extent as the licensor (full license). Termination - at the latest on the lapse of the patent. Unless in a license contract the exclusive exploitation of the invention in a specific manner is reserved, the grant of a license to one party shall not prevent other parties from being granted a license, as well as the patent holder from concurrent exploiting of the invention at (nonexclusive license). Licence agreement
product embodying the invention or manufactured by means of the invention, consisting in particular of its offering for sale or putting on the market, if that product has lawfully been put on the market on the territory of the Republic of Poland or EEA by the patent holder or with his consent. Abuse of right The patent holder or the licensee may not abuse his rights, in particular by preventing the invention from being exploited by a third party, if such exploitation is necessary for the purpose of meeting home market demands and is particularly dictated by public interest considerations, and
A licensee may grant a further license (sub-license) only with the patent holder’s consent; grant of further sublicenses shall not be permitted.
consumers are supplied with the product in insufficient quantity or of inadequate quality, or at excessively high prices.
Recorded in the Patent Register. The holder of an exclusive license may enforce his claims in the event of infringement
Utility model
the licensor shall be required to transfer to the licensee all the technical know-how as necessary to exploit the invention that is available to him at the time of concluding the contract. (active licence) Where a licensed patent is transferred, the license contract shall be binding on the successor in title. Exhaustion of rights The rights conferred by a patent shall not extend to acts concerning a
Any new and useful solution of a technical nature affecting shape, construction or durable assembly of an object shall constitute a utility model. A utility model shall be considered a useful solution if by means of that solution a practical effect is attainable, expedient in the process of manufacturing or exploitation of the product. Industrial designs and trademarks protection Marek Salamonowicz Industrial design definition
appearance of a product, which is: 1) new, 2) individual character, which manifests itself in particular in the shape, the features of the outside surface, colours, lines or ornamentation shall not constitute indust. design – an appearance of a product dictated solely by its technical function new - if, before the date of application, 1) it has not been made available to the public in such a way as to enable its reproduction, 2) neither there isn’t any design enjoying the earlier priority. Individual character - if the overall impression it produces on the informed user differs from the overall impression produced on such a user by any design which has been made available to the public Rights in registration of industrial design The right in registration shall confer the exclusive right to exploit the industrial design for profit or for professional purposes throughout particular territory. Termination - 25 years counted from the date of filing of an application. Specialization - Limited to the kind of products that are subject matter of an application. The scope - determined jointly by the drawing of the design and its essential features specified in the description. Trade marks ®
Any sign represented or capable of being represented graphically may be considered as trademark, provided that such sign is capable of distinguishing the goods of the same kind of one undertaking from those of other undertakings. Types: words, designs, ornaments, combinations of colours, the threedimensional shape of goods or of their packaging, as well as melodies or other acoustic signals. trademarks shall also mean service marks, Functions: 1 distinguishing, 2 advertising 3 guarantee Rights of protection shall not be granted for signs which: 1) cannot constitute a trademark, 2) are devoid of sufficient distinctive character (i) signs which are not capable of distinguishing, in trade, the goods for which they have been applied, (ii) signs which consist exclusively or mainly of elements which may serve, in trade, to designate the kind, origin, quality, quantity, value, intended purpose, manufacturing process, composition, function or usefulness of the goods, (iii) signs which have become customary in the current language and are used in fair and established business practices. Other obstacles (i) infringes third parties’ personal or economic rights, or
(ii) is contrary to law, public order or morality, or (iii) may mislead the public, in particular as to the nature, quality, properties of the goods or, as to the origin thereof. (iv) it has been applied for protection with the Patent Office in bad faith, Other obstacles (v) it incorporates official names and symbols and other officially recognized signs accepted for the use in trade, such, in particular, as: safety marks, quality marks, hallmarks of legalisation – to the extent to which it could mislead the public as to the nature of such signs, unless the applicant is able to prove his right to use them, (vi) religious, patriotic or cultural nature – to the extent to which it could hurt religious feelings, sense of patriotism or national tradition, (vii) it constitutes a form or another feature of the goods or their packaging, which is dictated exclusively by their nature, is necessary to achieve a technical result or it gives substantial value to the goods. Relation to other trade marks (i) is identical to a trademark registered or applied for registration with an earlier priority date on behalf of another party for identical goods, (ii) is identical or similar to a trademark registered or applied for registration with an earlier priority date on behalf of another party for
identical or similar goods, if the use of that mark is likely to mislead part of the public in particular by evoking associations between the marks concerned, Renown trademark (iii) is identical or similar to a renown trademark registered or applied for registration with an earlier priority on behalf of another party for any kind of goods, if it without due cause would bring unfair advantage to the applicant or be detrimental to the distinctive character or the repute of the earlier trademark. apply to well-known trademarks accordingly. The right of protection confer the exclusive right to use the trademark for profit or for professional purposes throughout the particular territory. Duration - 10 years counted from the date of filing of a trademark application with the Patent Office. (i) affixing the trademark to the goods covered by the registration or to the packaging thereof and putting the goods on the market, (ii) using the trademark on business documents handled in putting the goods on the market or in rendering services, (iii) using the trademark in advertising. Exhaustion of right The right of protection for a trademark shall not entitle the right holder to prevent the goods bearing
that trademark from being offered or marketed, where the goods have earlier been put lawfully on the market on the EEA territory by the right holder or with his consent. Right holder can’t prevent third parties from using (i) their names, (ii) indications concerning, the features and characteristics of goods, the kind, quantity, quality, intended purpose, origin, the time of production or of expiration of usability period, (iii) a registered mark or a similar mark, if it is necessary to indicate the intended purpose of the product, in particular as far as offered spare parts, accessories or services are concerned, Legal remedies Any person whose right of protection for a trademark has been infringed or any person enjoying the same status, may demand: 1) the cessation of the infringement, 2) the redress of its consequences, 3) the surrender of the unlawfully obtained profits 4) the compensation of damages in accordance with the general principles of law.
