Exhaustion of Exclusive Rights and the Problem of Parallel Imports under Restrictive Measures

INTRODUCTION. Contemporary international relations are characterized by a high degree of transformation due to the formation of a multipolar world, geopolitical and geo-economic changes, which creates challenges for the international community in trying to solve them. Due to the substantially changed configuration of international relations, as well as the shifting of global economic centers, the countries of the West, seeking to maintain the position of leading economic powers, attempted to use unilateral restrictive measures against States that do not share the Western vision of a fair world trading system as an instrument of political and economic pressure. Significant consequences of such decisions are the violation of constitutive principles of international trade law, increasing protectionism in world trade, undermining free trade system, disruption of logistics chains, formation of economic alliances, as well as the fragmentation of world trade. Violation of fundamental principles of international trade law through the application of unilateral restrictive measures has created economic and legal preconditions for their circumvention in order to ensure economic security and the adaptation of States in the current conditions. Parallel imports are one of the tools for levelling the effects of unilateral restrictive measures. The international legal assessment of the legitimacy of parallel imports depends on the chosen and nationally determined regime of exhaustion of exclusive rights (Article 6 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).

The purpose of this article is to examine the legality of parallel imports from the point of view of exhaustion of exclusive rights, as well as to analyse the transformation of approaches to its assessment in the context of the application of unilateral restrictive measures.

MATERIALS AND METHODS. For the purposes of this study, the authors analyzed international legal acts that constitute the basis of the international system of protection of intellectual property rights, constitutive acts of integration associations in terms of regulating the protection of intellectual property rights, national legislation and judicial practice of individual states, as well as the work of domestic and foreign researchers in the field of international economic, trade and private law. During the writing of the article applied general (analysis, synthesis, induction, deduction, forecasting) and special legal methods (formal-legal, comparative-legal) scientific knowledge.

RESEARCH RESULTS. Based on the analysis of the legitimacy of parallel imports in terms of the basic principles (regimes) of exhaustion of exclusive rights, taking into account current political and economic realities, the authors concluded that their division is conditional and there is a tendency to form a «mixed» exhaustion regime. Unilateral restrictive measures against a number of States have shown the inefficiency of the regional and national regime of exhaustion of exclusive rights in conditions of political and economic instability, as well as their lack of conformity with the principles of freedom and trade liberalization.

DISCUSSION AND CONCLUSIONS. The debate on the possibility and legality of parallel imports at the international legal level lies in the definition of their economic and legal nature and is related to the specificity of its interpretation within different legal systems. Parallel imports are one of how States can gain access to goods, in particular critical goods, and contribute to the formation of economic blocks within which free movement of goods is possible. The application within a State or an integration association of an international regime of exhaustion of exclusive rights minimizes the possibility of exerting economic pressure on them to achieve specific objectives.

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