La Russia ha introdotto il rublo digitale, una nuova forma di valuta che coesisterà con le versioni contante e non contante. Il progetto, in fase sperimentale per un anno, coinvolge 15 banche e mira ad aprire il mercato finanziario all’innovazione, contrastare l’impatto delle sanzioni finanziarie occidentali e modernizzare il sistema economico e finanziario

Articolo di Armando Ambrosio pubblicato su Agenda Digitale

Download Article

The post VIOLAZIONE PRIVACY: PORTE APERTE A OGNI RICHIESTA DI RISARCIMENTO? appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

Riportiamo di seguito il commento dell'avv. Armando Ambrosio pubblicato nell'articolo di Antonella Scott su Il Sole 24 Ore

«L'impressione è che nella prima fase all'inizio della guerra le sanzioni siano state irrogate troppo in fretta, con motivazioni vaghe e non circostanziate», spiega Armando Ambrosio, partner responsabile della sede di Mosca dello Studio legale De Berti Jacchia. Una fretta evidenziata dalle due sentenze della Corte di Giustizia nel marzo scorso. «Nel caso di Nikita Mazepin - nota Ambrosio - il ricorso è stato accolto perché si è ritenuto che la sospensione dalle gare avrebbe creato un danno irreparabile a un pilota di F1, pregiudicandogli la carriera». Il ricorso di Violetta Prigozhina apre un'altra breccia: accusata di essere proprietaria della Concord Management and Consulting e di altre società del figlio, ha dimostrato di non esserlo più dal 2017. «I giudici hanno dovuto darle ragione - dice Ambrosio -. Essere la mamma di Prigozhin non costituisce elemento sufficiente per essere sanzionati».

Continua a leggere l'articolo

VAI ALL'ARTICOLO COMPLETO

The post MONTA L’OFFENSIVA GIUDIZIARIA DEI RUSSI SANZIONATI DALLA UE appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

Download Programme

Register

The post NFT (NON-FUNGIBLE TOKEN): COSA SONO E COME POSSONO ESSERE UTILI ALLA TUA AZIENDA – Aice, Webinar, June 15th, 2023 appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

The Russian Intellectual Property Court recently issued a landmark decision on case SIP-666/2022, supplying additional guidance and elaboration on the notion of interested party in trademark cancellation cases.

The term “interested party” is used in Part IV of the Russian Civil Code regulating intellectual property, namely, with regard to trademarks in articles 1486, 1511, 1513 and 1514.

Article 1486 of the Civil Code provides that in case of non-use of a trademark, an interested party may claim its cancellation. The same subjective qualification is required by article 1486 for the filing of a cancellation action on grounds that a trademark was registered in breach of the law. According to the provision of article 1514, a party filing a cancellation action against a trademark, which became a commonly used name of goods, should also prove its interest. Finally, article 1511 likewise refers to the interest requirement that needs to exist for a party claiming cancellation of a collective trademark used for goods lacking unified and equable characteristics. It, therefore, follows that the interest requirement amounts to a horizontal, overarching common denominator for third parties to avail themselves of a number of statutory provisions that in the abstract justify the removal of a previously granted trademark from the system.

The Supreme Court of the Russian Federation in its Resolution of the Plenum no. 10 dated 23 April 2019 (Resolution) provided explanations in the matter of interested party assessment in cases of trademark cancellation for non-use. In item 165 of the Resolution, the Court held that, for there to be found interest, all circumstances of the case in their entirety should indicate that the claimant is truly focused on the further use of the same or a similar mark for similar goods.

There are, though, no listed criteria to be looked at by a claimant or the court seized for measuring the sufficiency of the interest that needs to underly a trademark cancellation action. The assessment is, therefore, made by court on case-by-case basis.

The less recent case law had held that, besides other evidence, claimants should always provide application(s) for registration of similar marks for similar goods as a confirmation of their interest in the further use of the challenged trademark. The current case law tends to find instead that this is not sufficient.

By its decision in case SIP-666/2022 the IP Court shed fresh light on the assessment of interest in this context.

The case (case no. SIP-666/2022) had been initiated by French beauty and fragrances multinational L’Oréal, claiming cancellation of mark AZZARO protected in Russia under international registrations on the ground of non-use during the previous three consecutive years. L’Oréal, as the owner of family of trademarks comprised of the AZZARO word element, and protected for cosmetics and perfumery (03 Class of the Nice Classification), claimed cancellation of the AZZARO trademark of French company Loris Development, registered in Russia for alcoholic drinks and tobacco (33, 34 Classes of the Nice Classification).

L’Oréal had devised its cancellation action to forestall the potential launch of alcoholic drinks and tobacco products on the Russian market under the same name. It argued that the marketing of alcoholic and tobacco products under the AZZARO mark may lead to its dilution, namely, by blurring the association of the AZZARO brand with L’Oréal and causing harm to its reputation. More particularly, L’Oréal was keen on avoiding the appearance on the market of goods whose image was increasingly less socially acceptable, such as alcohol and tobacco products.

Before commencing a legal action against the AZZARO trademark of Loris Development, L’Oréal had filed an application itself seeking protection of the AZZARO mark for alcoholic drinks, tobacco and tobacco related products, which was predictably denied registration due to existence of the AZZARO trademark sought to be cancelled.

The IP Court recalled that there is no legal definition of “interested party”, and a non-use cancellation action can be filed by any third party showing a lawful interest therein. It furthermore specified that producers of goods similar to those which are protected by the trademark, who have a genuine intent to use the mark and engaged in relevant preparatory work to that end, can qualify as an interested party for the purpose of a cancellation action. The Court moreover relied on item 165 of the Resolution.

Further, the IP Court specified that interest can rest on the need to remove a mark resulting in the dilution of the trademark of the claimant, where the co-existence and use of similar marks may lead to confusion among consumers and uncertainty in identifying the origin of goods.

According to the ruling, the assessment of potential confusion includes an evaluation of the similarity of the goods concerned, which is thus of the essence to identify interest.

The IP Court found that L’Oréal was producing and marketing cosmetic products and its trademarks were registered and protected for cosmetic products, whilst the challenged trademark covers non-similar goods. Thus, the Court drew the conclusion that there was no risk of confusion between the marks, and the existence of the similar mark did not preclude L’Oréal from using its AZZARO marks for cosmetic products.

At the same time, the Court held that the mere fact of filing an application, which was denied registration, could not amount to sufficient proof of interest and intent of the claimant to use the trademark for alcoholic drinks and tobacco products.

L’Oréal also relied on the foreign “dilution doctrine”, which was explained by the Court to result in the need for enhanced protection of marks with a reputation for dissimilar goods that may evoke associations with the protected mark. The higher the reputation of the mark, the more it is exposed to dilution. L’Oréal claimed that both variants of dilution, namely, dilution by blurring and dilution by tarnishment, were relevant to the case.

The IP Court, though, held that the claimant failed to prove that L’Oréal was widely known to Russian consumers as a producer of relevant goods in 03 Class of the Nice Classification affixed with the AZZARO mark. Information provided by L’Oréal about press news, publications on the purchase of the AZZARO brand and its history was considered by the Court insufficient, as it did not prove that consumers knew the mark and associated L’Oréal with the AZZARO brand. As a result, the Court found that the high reputation and notoriety of the AZZARO mark and its claim for enhanced protection were not substantiated by the claimant.

Besides, the Court found the argument whereby the use of the mark for alcoholic and tobacco products harmed the reputation of L’Oréal ungrounded as well as speculative. This stance was moreover adjudged inconsistent, as the claimant itself had filed an application for registration of the mark for alcoholic drinks and tobacco products.

According to the judgement, the ownership of a trademark with an earlier priority is neither sufficient as sole evidence, nor mandatory, to prove interest in the cancellation of a later trademark on non-use basis.

To sum up, the IP Court drew the conclusion that L’Oréal failed to prove its interest in using the mark for alcohol and tobacco products, and dismissed the claim. A trademark can be cancelled on non-use grounds if both requirements are met, namely, proved interest of the claimant and absence of evidence of use of the mark by the rightholder, so that the lack of either is sufficient to deny the claim.

Download Article

The post FRESH GUIDANCE FROM THE RUSSIAN IP COURT ON INTERESTED PARTY REQUIREMENTS IN TRADEMARK CANCELLATION CASES appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

Download Programme

Register

The post PROPRIETÀ INTELLETTUALE IN RUSSIA. NOVITÀ GIURIDICHE D’INTERESSE PER L’INDUSTRIA ITALIANA A SEGUITO DELLA CRISI RUSSO-UCRAINA – Webinar CCIR, February 13th, 2023 appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

The practice concerning liability of controlling persons for debts of legal entities excluded from the unified state register of legal entities (EGRUL) following a decision from tax authority is being developed. In the past the Supreme Court and Constitutional Court of the Russian Federation took different views on this matter: from presumption of guilt for the controlling person to obligation of the creditors of the legal entity to monitor possible exclusion of such entity. In this article we will focus on the current court practice and the more correct approach.

According to the general rules that are applicable in case of bankruptcy^[1], subsidiary liability of the persons controlling the legal entity for the debts of such legal entity is frequently applied in practice. As provided by Art. 3, par. 3.1, of the Federal law dated 08.02.1998 No. 14-FZ “On limited liability companies” (hereinafter the “Law on LLC”), the persons controlling a legal entity excluded from EGRUL also bear subsidiary liability for the debts of such legal entity.

The court practice illustrated two possible approaches in applying subsidiary liability:

• holding the controlling persons not liable since the creditors must monitor the situation with their debtor (inter alia, its exclusion from EGRUL);
• holding the controlling persons liable if such persons allowed the exclusion from EGRUL of the legal entity with debts (unfair actions of the controlling persons in this regard are committed).

The Supreme Court^[2] clarified that exclusion of the company from EGRUL as a result of actions or omissions of the controlling persons are not considered as sufficient grounds for subsidiary liability of the controlling persons. It is required to prove that unreasonable and/or unfair actions (omissions) of the controlling persons led to inability of the legal entity to fulfil its obligations towards its creditors. This practically means that the controlling persons are liable for causing the bankruptcy of the legal entity. So, if the due procedure of liquidation of the legal entity was conducted, the debts of the such legal entity towards its creditors would still not be settled.

The Constitutional Court in its decision dated 21.05.2021 No. 20-П, on one hand, upheld the practice of the Supreme court as regards the grounds for holding the controlling persons liable. On the other hand, the Court pointed out that, in case of filing a claim with the courts to hold the controlling persons liable, the same controlling persons as defendant must prove that they did their best to fulfill their obligations towards the creditors of the legal entity. However, this interpretation was provided by the Constitutional Court merely in relation to physical persons as claimants, probably in order to protect physical persons from entrepreneurs. At the same time, the Constitutional Court added that this can also be appliable to physical persons.

Following this decision of the Constitutional Court, the courts have changed their practice and guilt of the controlling persons became a presumption only following to the exclusion from EGRUL of the legal entity with debts. This rule was applicable regardless of whom was the subject who filed a claim: either a physical person or an entrepreneur.

Considering this incorrect trend, the Supreme court has taken the decision by the Court Collegium for economic cases dated 03.11.2022 No. 305-ЭС22-11632 in the case No. A40-73945/2021 to clarify the following issues:

• subsidiary liability under Art. 3, par. 3.1, of the Law on LLC is only possible in case of causing bankruptcy (inability to fulfill obligations towards the creditors) of the legal entity excluded from EGRUL;
• there is no presumption of guilt in case of filing a claim by the creditors (entrepreneurs), so the claimant must prove that exclusion of the company from EGRUL occurred as a result of unreasonable and/or unfair actions (omissions) of the controlling persons that eventually led to the incapability of the legal entity to fulfill its obligations towards its creditors. The courts must determine whether the clamant presented any objections as regards the exclusion of the legal entity from EGRUL. This differs from the cases when claims are filed by physical persons when the guilt of the controlling persons is presumed^[3].

This position of the Supreme court represents the correct approach in terms of subsidiary liability. It is worthwhile mentioning that, even in bankruptcy cases, the Supreme court has never established the presumption of guilt just due to the fact that the claim was filed by a physical person. At the same time, it is obvious that the creditor, being an external person to the legal entity, is not able to prove its claim confirming the exact unreasonable and/or unfair actions (omissions) committed by the controlling persons if such creditor does not have access to the internal documentation of the legal entity.

Presumption of guilt of the controlling persons – as clarified by the higher court – in practice leads to the fact that the lower courts, in compliance with the instruction from the higher court, immediately take a decision concerning subsidiary liability of the controlling persons. Any attempts to prove the contrary by the controlling persons acting as defendant are unsuccessful. The position of the courts in this respect is that the controlling persons could act in a better way and thus prevent the legal entity from inability to fulfill its obligations towards its creditors, as well as exclusion of the legal entity from EGRUL. In the absence of such actions by the controlling persons, its subsidiary liability is reasonable.

In reality, a due balance between the claimant and the defendant is needed. On one hand, the controlling persons (defendant) must be given the opportunity to present even a minimum clarification as regards the financial situation of the legal entity prior to its exclusion from EGRUL and to disclose the documents requested by the claimant^[4]. On the other hand, the claimant (the creditor), on the basis of the information and documentation obtained from the defendant, must prove the essence of a causal connection between the actions (omissions) of the controlling persons and the inability of the legal entity to pay its debts towards the creditors, as well as to prove the guilt of the defendant.

Should the controlling persons deny to present such clarifications and disclose the evidence, this theoretically may be considered as an unfair behavior by the controlling persons. In this case, presumption of unfair behavior and guilty actions of the controlling persons seems to be reasonable.

Download Article

The post EXCLUSION FROM EGRUL: POSSIBLE SUBSIDIARY LIABILITY OF THE CONTROLLING PERSONS appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

A non-competition clause is a special restriction limiting a business activity voluntarily assumed by a party towards the other party after termination of an agreement. It is quite usual in franchise agreements. It provides additional protection of IP rights, once the contractual obligations are no longer applicable. The concept may look straightforward enough, but in situations of conflict between the right-holder and the franchisee, non-competition clauses may become uncertain and potentially at the source of litigation.

The Supreme Court of the Russian Federation recently concerned itself with the subject in case A71-13420/2020, and issued its decision on 09 June 2022 on the claims of a franchisee challenging the validity of a non-competition clause after termination of the agreement. More particularly, the assessment of the Supreme Court addressed the penalty claims of a franchisor originated by the continuation of a competing activity after termination of the agreement by a person affiliated with the franchisee, as well as the counter-claim of the defendant seeking a finding of nullity of the relevant non-competition clause. The first instance court had rejected both claims and counter-claims, and the appeal and cassation courts upheld the first instance judgment. As a result, the Supreme Court as the highest instance of jurisdiction was revising the case.

The non-competition clause of the agreement under dispute foresaw the obligation of the franchisee to refrain from competing actions during the term of the agreement and three years after the termination thereof, and the right of the right-holder to terminate the agreement in case of breach by the franchisee of the non-competition obligation. The contract also contemplated a penalty in the amount of 1 million Rubles (about Euro 16 000) for any unlawfully competing action, performed by the franchisee or its affiliates.

The courts of first, appeal and cassation instances had found that the agreement had been unilaterally terminated before claims of breach of the non-competition clause and for payment of the penalty were filed. Based on the fact that the agreement was then no longer in force, all courts had rejected the claims of the right-holder.

The Supreme Court referred first to the general legal regime of franchise agreements, in particular, to the provision of article 1033 of the Civil Code whereby the parties may consensually agree on some restrictions of their rights. In particular, the law expressly contemplates among permissible restrictions the assumption of the obligation of the right-holder to refrain from granting similar rights to other parties, or the obligation of the franchisee not to compete with the right-holder by engaging in a business activity similar to that covered by the franchise agreement.

The Supreme Court furthermore referred to item 3 of Resolution no.35 dated 06 June 2014 of the Supreme Arbitration Court of the Russian Federation. That item explained the enforcement mechanics of part 2 of article 453 of the Civil Code, which provides that the obligations of the parties cease to exist upon termination of the agreement, unless otherwise prescribed by law, the agreement itself or pursuant to the core – that is, the very intrinsic nature – of the obligation. The Supreme Court clarified that, by its Resolution, the Supreme Arbitration Court had confirmed that the termination of a contract released the debtor from the obligation which was the subject of the contract. However, the same Resolution specified that the terms and conditions of the contract governing post-agreement relations, or those applicable after termination, remained in full force and effect unless otherwise agreed by the parties. Since security measures provided for in the contract (such as a contractual penalty) are accessory to and follow the destiny of the main obligation, if the main obligation remains in force upon termination, then the security provision equally survives.

Based on the facts of the case, the Supreme Court found that the franchise agreement contained a clause aimed at governing the relations of the parties after termination of their agreement, namely, the non-competition obligation of the franchisee. This obligation was expressed to be valid for a term of three years after termination of the contract, so the parties had intended the clause to survive such termination. Furthermore, the Supreme Court adjudged the penalty clause, which was referred to within the non-competition clause, also valid and applicable, as it secured the main obligation, which had not come to an end with the termination of the franchise agreement.

As a result, the Supreme Court set aside in part the decisions of the lower courts and ordered the retrial of the case by the first instance court. The penalty claim of the right-holder because of the opening of a competing activity by a person affiliated with the franchisee was, though, rejected as the claimant had failed to prove the affiliation between that person and the franchisee.

On 29 August 2022 the first instance court issued on remand a revised decision and granted claim of the right-holder for payment of the penalty for breach of the non-competition clause contained in the franchise agreement.

One may wonder if the above conclusions of the Supreme Court are applicable to the validity of non-competition clauses included in an intellectual property license agreement, but this is not the case. Let us see why.

Both license and franchise agreements share the feature of granting rights to use the IP object of a contract only for the term of the latter. Once the relevant contract terminates, the licensee/franchisee must discontinue the use of the IP rights of the right-holder The unlawful continuing use of such IP rights by the licensee/franchisee after the contract expiration or termination hence constitutes an infringement, and Russian law provides the right-holder with a number of statutory remedies – namely, seeking a judicial order to desist from the infringement and seeking payment of compensation therefor.

However, this provision does not cover a situation where the former licensee/franchisee does not unlawfully use IP rights, but rather continues to unduly use the competences and experiences developed during the term of the agreement, for building up and/or continuing to engage in its own business on the same market. That is the case of a negative obligation such as that contained in a non-competition clause expressly obliging the licensee/franchisee to refrain from being active on the same market as a business rival.

Article 1033 of the Civil Code previously mentioned, which provides for the parties’ option to agree on contractual restrictions, including a non-competition clause only addresses franchise agreements and does not cover intellectual property license agreements. Based on the general principle of contractual freedom set out in part 4 article 421 of the Civil Code, the parties are at liberty to agree the terms and conditions of the contract they make unless otherwise prescribed by Russian law.

The provisions of Part 4 of the Civil Code that govern intellectual property license agreement set mandatory terms and conditions for such agreements, but without prejudice to any other provisions. Accordingly, there seems to be no legal prohibition to insert a non-competition clause in a license agreement.

It should, though, be noted that the concepts of license and franchise agreement present significant differences, and this may end up at the source of an extent of legal uncertainty.

According to article 1235 of the Civil Code, an IP right holder may grant or undertake to grant to another party the right to use its right on the terms provided for in a license agreement. A trademark license agreement is a particular case of IP license. As provided by article 1489 of the Civil Code it consists of the grant of the right to use a trademark on the terms of the agreement for all or part of protected goods and optionally specifying the territory of use.

Conversely, a franchise agreement, according to article 1027 of the Civil Code, mandatorily foresees the grant of a bundle of IP rights, including trademark and other rights, in particular, the right to a commercial name and know-how for use in a business activity, for a consideration. That same article provides that the rules of Section 7 of the Civil Code (on IP rights) relative to license agreements are also applicable to franchise agreements, unless this is contrary to more specific provisions applicable to the latter. Since a franchise agreement is a special case of IP license, the special rules applicable to the former prevail over the general provisions, and as aa result do not apply to license agreements.

In other words, the legislator did not bind the rationale for a non-competition obligation to a trademark license, but to other information and rights typically provided for in the franchise agreement. The licensee holds only the right to use an IP right, e.g. a trademark, and is not supposed to obtain any additional information about the business activity of the right-holder. For that reason, it makes sense that he could not enjoy a competitive advantage after the termination of the license.

Based on the contractual freedom principle and the provisions of item 3 of Resolution no.35 dated 06 June 2014 previously mentioned, a non-competition clause included in a license agreement should also be valid after termination of the license, but it is not yet clear if the Russian courts will concur with reconstruction in real life, when seized of a dispute similar to that adjudged on remand in the recent case we reported on.

Download Article

The post NON-COMPETITION CLAUSES SURVIVE AND REMAIN ENFORCEABLE AFTER TERMINATION OF A FRANCHISE AGREEMENT. WHAT ABOUT LICENSE AGREEMENTS? appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

General Overview

The general regulatory framework of the precious metals and stones industry in Russia is primarily supplied by Federal Law “On precious metal and precious stones” no. 41-FZ of 26.03.1998. It covers their production, sale, state control and reserves, as well as international operations of the Russian Federation in that area. However, that of precious metals is historically a politically sensitive industry in Russia, which is addressed by a variety of concurrent sources, producing a complex legislative landscape. The inherent complexity and importance of the industry are presently enhanced by the adverse geopolitical circumstances. In this article, we will address certain features and provisions that are likely to be of interest in the international perspective.

Section 6 of Law no. 41-FZ consists of only two articles, and generally allows international agreements for gold mining, production and use, and trade in precious metals and stones. Drafts of agreements, where a party is the Russian Federation or a territorial entity thereof, must be submitted to the Russian Government for prior examination and overcome a mandatory legal and economy assessment, and furthermore need to be ratified and registered after their conclusion.

The industry production sharing agreements are subject to special rules and procedures supplied by Federal Law “On agreements on production sharing” no. 225-FZ of 30 December 1995, with the exception of rough diamonds, which cannot be the object of product sharing.

There are also other relevant instruments in existence addressing the export of precious metals.

Based on the principles of freedom of movement of goods, capital and labor force of the Eurasian Economic Union (EAEU), which comprises a common customs territory including Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan, certain aspects of gold export transactions fall under the regional level, whilst other aspects are governed by Russian law at the national level.

Import and Export

The import into and export from the EAEU countries of precious metals need to comply with an authorization-based procedure set out in Decision of the Eurasian Economic Commission no. 30 “On non-tariff regulatory measures” dated 21 April 2015 (EAEU Decision no. 30) Attachment no.2, which besides other goods applies to precious metals and raw materials containing precious metals.  Attachment no.14 of EAEU Decision no.30 lays down the procedure of import into and export from the EAEU of such precious metals and raw materials.

The general rules of Decision no. 30 are not applicable, if the EAEU Member State adopts specific rules at the national level in the following excepted matters:

• radio and stable isotopes of precious metals and goods made thereof;
• import or export of precious metals or raw materials containing the same for holding by the State treasury;
• import or export of precious metals or raw materials containing the same by national (central) banks;
• import or export of coins made of precious metals that constitute a lawful mean of payment.

Besides, valuable cultural artifacts and goods for private use made of gold and precious metals are not subject to the special EAEU procedure.

Licenses, Customs Controls, Administration

General rules on license issuance are provided for in the Attachment to Attachment no.7 to the Agreement on the Eurasian Economic Union signed in Astana on 29 May 2014, and relevant Instructions on the filing of applications for export or import license grant were approved by Decision of the Board of the Eurasian Economic Commission no. 199 dated 06 November 2014.

Single-use export licenses are granted for a certain deal or contract in accordance with its terms and conditions, lasting for a term not exceeding 1 year. General licenses cannot exceed the 1 year term either, whilst the term of exclusive licenses is established on a case-by-case basis.

Customs control of raw materials containing precious metals and goods made thereof is carried out at special purpose customs terminals/stations (which are ad hoc customs checkpoints of the Central Excise Customs of the Russian Federation) upon production of an export license duly granted by the relevant national authority of the EAEU Member State of registration of the exporter.

The detailed regulation of import from and export to foreign countries outside of the EAEU of precious metals, raw material containing them, and precious stones is moreover to be found in Order of the President of the Russian Federation no.1137 dated 20 September 2010 (as amended on 01 July 2021), whose main contents may be summarized as follows:

• The issuance of export licenses for precious metals falls under the competence of the Ministry of Industry and Trade, which reviews applications and issues licenses (in accordance with the Administrative Procedure on license issuance adopted by Order of the Ministry of Industry and Trade no. 3624 dated 18 October 2017);
• The Russian Government sets the quantity limits for export of precious metals (except gold), and precious stones from the State Fund (Reserve) of precious metals and stones of the Russian Federation;
• The Russian President may approve gold exports from the State Fund of Russia, as well as of other precious metals, which are in excess of the planned quantities/values set by the Russian Government, as well as natural rough diamonds of 10,8 karats and above in weight, and unique natural rough diamonds;
• The approval of the sale of part of the gold reserves stored at the Central Bank of Russia falls within the competence of the Central Bank itself in accordance with a special procedure agreed with the Russian Government;
• The State Authority on building up the State Fund of precious metals and precious stones of the Russian Federation, on storage, release and use of precious metals and precious stones (Gohran of Russia), the Federal Assay Chamber and the Russian Customs are the state bodies authorized to control production, internal sales, import and export of gold and other precious metals.

The Federal Assay Chamber is a control body of the Ministry of Finance. It performs control of product quality and entities that comply with special requirements and are allowed to produce and sell gold. The Chamber issues special authorizations (grants license) to such entities and maintains the relevant list of gold producers and sellers.

As mentioned above, the Russian Central Bank exercise discretionary control, including export deals, over gold reserves in its possession. The right to perform a certain gold export deal by other entities (license) is granted by the Ministry of Industry and Trade in accordance with orders of the Russian Government.

Quantitative and Market Highlights

The Russian Central Bank has been carrying out extensive purchases of gold in the internal market for state reserves since 2014, and by the end of 2019 the gold stocks of Russian international reserves had reached US $ 120 bln. by April 2020, which was close to cap 21% of total state reserves of the Russian Federation^[1].

During 2019 the Central Bank reduced the volume of gold purchases from Russian producers and announced discounts for procurement of gold on the internal market^[2]. Discounts were aimed to stimulate internal purchases of precious metals by Russian commercial banks to fill the gap between produced volumes (supply) and needs of the internal market (demand, without considering state purchase).

Alongside with procurement measures from Russian producers, the Government liberalized and simplified procedures for export by financial institutions and producers, which lead to an increase of exports overall after 2019. For example, during January-April 2020, 71,9 tons of gold were exported from Russia, which was 7,9 times the export volume during the same period in 2019.

Decisions on license issuance or rejection are made by the Ministry of Industry and Trade within 15 working days (10 working days in case of filing the application online) subject to providing all necessary documents. The rejection can be challenged in court in accordance with the general rules of section 22 of the Russian Code of Administrative Judicial Proceedings (no. 21-FZ of 08 March 2015) within 3 months from the date of the decision.

The existing legislative framework furthermore permits other State authorities to issue specific regulatory acts allowing the export of precious metals, including gold. The following are recent examples worthwhile recalling.

On 17 April 2020 the Russian Government issued Regulation no. 539 instructing the Ministry of Industry and Trade to issue general licenses for the export of refined gold and silver in bars (bullions) to mining and producing companies in accordance with their applications approved by the Ministry of Finance.

Based on the new regulations, gold producers sold most of precious metal in bullions to Russian banks, which extended gold exports upon withdrawal of regulatory restrictions. The Russian Central Bank held the largest stock of gold of more than 2,000  tons^[3] and released some gold for export in 2020. Russian commercial banks, including major banks Sberbank, GazpromBank, VneshTorgBank, PromSvyazBank, Otkrytie, were increasing gold stocks since May 2020 and reported to own about 121 tons of gold by September 2020^[4], and then were actively exporting it in 2020-2021 following world market gold price increase.

The main country of destination of Russian gold was the United Kingdom reaching as much as 93%^[5] in 2019-2020 and 84% in 2021. Switzerland, Turkey, Kazakhstan and China were the other main importers in 2019-2020. In 2021 the UK was also the leading gold importer. Switzerland, UAE, Germany, Italy and India had smaller but close volumes of import share, and China imported twice less. The Russian gold export in April-May 2020 overtopped the export value of gas and amounted to US $ 3.58 bln^[6].

According to international statistics, in 2019 Russia was ranked only 10th among the world gold exporters^[7]. However, the value of gold exported from Russia in 2020 increased 222% and reached US $ 18.7 bln^[8].  This increase achieved the country 6th place in the highest dollar value gold world exporters rating. In 2021 gold export value went down to US $ 17,4 bln. moving Russia to the 7th place^[9].

Geopolitical changes in 2022, sanctions and countersanctions

The geopolitical storm of 2022 following the Ukrainian crisis did not leave the gold unaffected.

As from March 2022, the Russian gold mining industry was hit by restrictions imposed by the independent precious metals market authority, namely the London Bullion Market Association (LBMA), which excluded six Russian gold refineries from “good delivery” status^[10], thereby for practical purposes cutting off sales of Russian bullion sales to London or Zurich. Loss of that status also made impossible gold export to many other foreign countries.

Besides, the usual practice when Russian refineries sold gold to major Russian commercial banks, and the latter exported it, became unfeasible, as these banks were sanctioned by the USA, the UK^[11] and EU, and could not perform international transactions, including gold export operations.

In March 2022 the Russian Ministry of Finance reported that the amount of gold produced in Russia in 2021 was 346,42 tons^[12], but neither monthly, nor quarterly data for 2022 were released. Simultaneously, the Federal Customs Service stopped publishing gold export statistics.

As a remedy to limitations of gold export in bullions, regulation no. 485 was adopted by the Government on 26 March 2022 allowing the issuance of licenses for export of gold and silver in grains, as well as platinum and platinum-group metals in bars, grains and powders.

Conversely, the export of waste and scrap of precious metals or clad with precious metals, other waste and scrap containing precious metals, and waste and scrap of electrotechnical products mainly used for extracting precious metals, was temporary banned by the Russian Government. In accordance with Regulation no.2401 of 23 December 2021, such items were declared of significant importance for the Russian internal market and could not be exported outside the EAEU starting from 01 February 2022 till 31 July 2022. By the time of expiry of the Regulation, the situation again changed, the ban was not extended, and the export of gold and precious metals is no longer limited by the physical form of the metals.

The Russian authorities did not issue other restrictions of gold export so far. However, at the end of June 2022 G7 states agreed to ban the import of Russian gold and the USA^[13], Canada and Japan issued relevant sanctions^[14].

The USA enforced the sanctions immediately at the end of June, the UK and EU – on 21st of July (EU as a part of the 7th package)^[15] and Switzerland joined the restrictions in August 2022. The EU sanctions apply not only to bullions, but also to gold in other forms, like powders, waste and scrap, coins, articles of jewelry and parts thereof.

In that perspective, the abovementioned Regulation no. 485 can be considered a counter- sanction measure in response to the ban of import of Russian gold in bars, but it does not apply in general to counter restrictions on operations with Russian gold.

In this challenging situation for gold export, after almost 2 years suspension, the Russian Central Bank resumed internal purchases of gold. The state bank buys in gold from the Russian refineries with 15-17% discount from the LBMA quotation.

On 12 July 2022 the Union of Russian Gold Prospectors (Union) published an open letter requesting State support to the industry, which is facing a deep crisis with sales and profitability putting at risk growth and development, and even the existence of small producers. Representatives of the industry explained that the Central Bank used to buy gold from producers with a 5% discount, which is considerable gold being at stake, but in the current situation purchases are made with as much as 15% off market price. The high exchange rate presently applying to the Russian Ruble cuts sale prices for export, whilst costs incurred inside the country does not decrease^[16].

Against that background, representatives of the Union suggested

• increasing purchases of gold for State reserve purposes at prices economically viable for producers,
• fixing minimum prices for gold on the internal market, and
• offering credits to industry players at the rate of 5%.

Meanwhile, on 12 July 2022 the Petropavlovsk company, a well-known large Russian gold producer registered in the UK, announced the initiation of bankruptcy proceedings, since the amount of its debt reportedly exceeds the value of its assets. Besides, the activity of the company was for practical purposes blocked by foreign sanctions, equity prices at the Moscow stock exchange fell by as much as 80%, and its bank (Gazprombank, which is also placed under foreign sanctions) failed to provide the usual business facilities and asked for the immediate return of its credit lines.

Russian producers still can sell gold to Middle East and Asia, however, at discounted prices. The Russian press cited industry experts, who said that export of gold in 2022 was shifted into UAE and China, and Russian refineries were selling gold with discounts of 20-30% from stock prices. China significantly increased imports of Russian gold, and according to Chinese customs statistics, the country imported in July 2022 8,6 times more gold than in June 2022.

Finally, Russian refineries faced another constrain to gold export, which materialized in the second half of 2022. Russian press recently reported that gold producers complain that the state authorities refuse to issue relevant authorizations for export of gold at the discounted prices that are below the world market price, so the Russian gold export is under pressure both outside and inside of the country

Download Article

The post EXPORT OF PRECIOUS METALS FROM RUSSIA. A LEGAL OVERVIEW BY MID-2022 appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

According to Russian law, a trademark may be registered in Russia subject to successful examination by the Russian Patent Office (Rospatent). Unlike to the EUIPO rules, the substantive examination of the application in Russia includes absolute and relative validity assessment. This means that the Rospatent checks both the distinctiveness of the mark and the existence of any conflicting rights (similar trademarks).

The existence of similar trademarks protected for similar goods prevents registration. Although a full opposition procedure similar to that in force under the EUIPO rules does not exist in Russia, the holder of an existing trademark may file with the Rospatent a letter of observations arguing that the mark under application should not be registered as being confusingly similar with existing mark. If the Rospatent disagrees with the position of a rightholder and grants protection to the mark applied for, a cancellation action against such registered mark can be filed claiming similarity with the earlier trademark and uncompliance with a legal requirement.

The Chamber for Patent and Trademark disputes (the Chamber) is an ad hoc body of the Rospatent competent to review objections brought against the Rospatent decisions under the administrative procedure, including those claiming the cancellation of trademark registration. According to Russian law, the decisions of the Chamber can be further challenged before the Russian IP Court.

Based on the provisions of articles 1512 and 1513 of the Russian Civil Code, US soft drinks multinational The Coca-Cola Company (Coca-Cola) had filed a cancellation action against a trademark owned by a Russian soft drinks producer with the Chamber claiming that the FANTOLA mark was confusingly similar with its own FANTA trademarks, and that the FANTOLA registration was therefore in breach of legal requirements and should be cancelled.

The Rospatent rejected the similarity claim with FANTA, and the FANTOLA trademark survived accordingly. For greater details please read our earlier article “Rospatent Chamber for Patent and Trademark Disputes:  FANTOLA is not confusingly similar with FANTA by Coca-Cola” (at https://www.lexology.com/library/detail.aspx?g=0a3d158c-42c3-4d30-a32b-5d843f507f51).

Coca-Cola then filed with the Russian IP Court a lawsuit claiming invalidation of the Chamber’s rejection decision on the FANTOLA trademark’s cancellation action.

The initial cancellation action was filed with the Chamber on 17 May 2021, and the rejection decision was dated 14 January 2022. The IP Court issued its ruling on the Coca-Cola lawsuit on 17 October 2022 (case SIP-353/2022).

In its lawsuit, the US company had challenged the Chamber’s arguing that the marks were indeed similar, and that the registration of the FANTOLA mark created confusion with FANTA mark and lead to loss of customers and damage of the Coca-Cola reputation. Coca-Cola’s key-reasoning was that FANTA had acquired an own significance as a brand of renown, whilst FANTOLA was plainly made up as a combination of words Fanta and Cola and quite obviously referred to these famous brands.

The owner of the FANTOLA mark filed a statement of defense, claiming an abuse of right by Coca-Cola, pointing out that the claimant had challenged only 2 out of 6 rejection decisions issued by the Rospatent on cancellation actions for different FANTOLA marks. The Russian company was arguing that bona fide conduct would be to challenge all rejections of all 6 cancellation requests, while doing the same for only 2 was not aimed at protection of trademark right and interests, but rather an unduly restricting a competitor. Besides, it argued that Coca-Cola could not be considered an interested party for procedural purposes (it is recalled that the interested party status is an essential qualification for filing a cancellation action) as it had suspended its business activity in Russia and accordingly did not meet the requirement of part 2 of article 1513 of the Russian Civil Code that a cancellation action can be initiated only by an interested party.

The IP Court reviewed the case and the Rospatent position and provided guidance for reconsideration of the similarity assessment made by the Chamber. We provide below the main arguments and reasoning of the Court, which may be of interest for rightholders in building up their defenses in trademark disputes before the Chamber.

The Court affirmed in the first place that Coca-Cola was an interested party for the purposes of seeking the cancellation request of the FANTOLA trademark and ruled that the ownership of a trademark with a priority date earlier than that of a similar challenged trademark was sufficient to satisfy legal requirements.

Besides, the Court noted that the cancellation action had been filed, and the rejection decision had been taken before the suspension of business in Russia, so that Coca-Cola’s rights could not be precluded as a result.

The IP Court moreover found the following faults in the decision of the Rospatent:

• level of phonetic similarity was not duly assessed;
• visual difference of marks was overestimated and did not dramatically affect the creation of an association between the marks;
• semantic features of the FANTA mark were neglected (with a note that contemporary dictionaries contain word “Fanta” as a generic word with the meaning of a soft drink with orange flavor);
• existence of a family of FANTA trademarks, its impact on similarity and potential perception of FANTOLA as a new mark in the family was not assessed;
• evidence provided by Coca-Cola was not duly scrutinized and taken into account.

The Court furthermore noted that to prove the linkage between the mark and a producer one should provide evidence of an emerging association between the product affixed with the mark and the producer. It was clarified that such element cannot be proved by evidence of mere presence on the market, but marketing efforts and actions of the producer to create the association in customers’ minds between the product and the company should be provided as well.

This logical path may be interpreted in the sense that the marks shall be considered confusingly similar, unless the Russian producer convince the Rospatent that customers link the mark with the producer itself.

The Rospatent provided additional explanations in its submissions in the Coca-Cola case, but the Court ruled that these could not remedy ill-grounded arguments and erring decision taken within the cancellation administrative procedure.

The IP Court hence directed the Chamber to re-evaluate the FANTOLA cancellation claim in the light of the principles that it had laid down. It also clarified that the court cannot issue its  decision on the merits of the case, as the litigation phase cannot circumvent the administrative one, and the Chamber is the legitimate body to settle the dispute.

This means that another decision is upcoming, which may radically change the balance of the trademark rights under dispute. The fate of the potential FANTOLA trademark cancellation though remains unclear, as the FANTOLA products are already marketed in Russia. If the mark was cancelled as confusingly similar with FANTA, Coca-Cola could file an infringement claim against the Russian producer and ban use of the FANTOLA mark, so that the eventual change of position of the Rospatent may have an actual material impact on the Russian soft drinks market.

By way of closing comment, we would like to add that the decision of the IP Court is a sophisticated document, substantively as well as procedurally, where legal arguments only have been weighed and applied in an unbiased fashion, fully independently of the nationality of the parties and, actually, so far recognizing to a large extent Coca-Cola ‘s rights and position. We are glad to note that the prophecies of those that foreshadowed the end of IP law in Russia with the advent of the Ukrainian crisis are being proven wrong.

Download Article

Download Article in Russian

The post RUSSIAN IP COURT REMANDS FANTOLA MARK CANCELLATION ACTION BY COCA-COLA COMPANY FOR RETRIAL appeared first on Studio Legale De Berti Jacchia Franchini Forlani.

Anche lo Studio De Berti Jacchia ha deciso, tramite la propria sede di Mosca, di rimanere al fianco delle imprese italiane ed europee operanti in Russia in questo momento di grave difficoltà. «Nostri clienti, infatti, sono quasi esclusivamente aziende italianeo europee impegnate sul mercato russo e dei Paesi CSI in operazioni commerciali, di investimento e di difesa della proprietà intellettuale», spiega Armando Ambrosio, Moscow resident partner- attualmente in Italia – dello studio De Berti Jacchi. «La nostra assistenza è improntata al pieno rispetto delle sanzioni irrogate dalla Ue, oltre che delle controsanzioni russe. Ultimamente siamo sempre più spesso chiamati a svolgere attività di due diligence su controparti russe, volta ad accertare che non si tratti di soggetti sanzionati. A tal proposito, abbiamo sviluppato una particolare expertise in questo settore ed elaborato best practice specifiche per tutelare le aziende nostre clienti contro il rischio di violazione delle sanzioni. Per policy interna, non assistiamo invece soggetti russi colpiti dalle sanzioni. Di recente siamo stati contattati dai un magnate russo, il quale ci ha chiesto assistenza nella presentazione di un ricorso per il dissequestro di uno yacht di sua proprietà. Ebbene, benché si trattasse di un mandato molto appetibile, abbiamo deciso di rifiutare l’incarico. Infine, segnalo che, oltre alle difficoltà contingenti dovute al contesto geo-politico ed al regime delle sanzioni, come operatori del diritto in questi ultimi mesi ci troviamoa dover fronteggiare un ulteriore problema legato alla grave incertezza normativa che regna attualmente in Russia. Le controsanzioni russe sono redatte, infatti, in maniera tale da lasciare un ampio margine all’attività degli interpreti, i quali – e mi riferisco in particolare, alle banche e ai notai – tendono ad assumere molto spesso posizioni rigidee intransigenti, per cui operazioni perfettamente lecite vengono talora bloccate a motivo dell’incertezza interpretativa che circonda i regolamenti».

Intervento di Armando Ambrosio su ItaliaOggi Sette.

Download Article

The post RUSSIA, ECCO GLI STUDI LEGALI CHE NON HANNO LASCIATO MOSCA appeared first on Studio Legale De Berti Jacchia Franchini Forlani.