NEWSLETTER

September 2002

TELECOMMUNICATIONS

Directive on privacy and electronic communications
Directive 2002/58/EC of the European Parliament and the Council of July 12, 2002 regarding the processing of personal data and the protection of privacy in the electronic communications sector, published in the Official Journal of July 31, 2002.

The specific scope of this Directive are the electronic communications services available to the public in the EU’s public communication networks. However, its provisions do not affect defense or public security activities out of the scope of the EC founding Treaty, or the activities of Member States in criminal matters. Also, this Directive does not affect the provisions of Directive 95/46/CE of the European Parliament and the Council concerning data protection, which shall continue to be applied to the electronic communications sector in all matters related to the protection of fundamental rights and liberties not specifically dealt with by the former, especially with regard to the obligations of entities responsible for data processing.

The Directive obliges Member States to ensure the confidentiality of communications and the related traffic data transferred through public communication networks and of the electronic communication services available to the public, expressly forbidding any sort of interception of communications and the related traffic data without the consent of the users concerned. For this reason, the Directive provides that the entities rendering the aforementioned services shall adopt the necessary management and technological measures to preserve the confidentiality and security of the services.

In the protection scheme set out in this Directive, the extension of the protection measures to companies is essential, as well as the distinction between “user” and “subscriber”. In this sense, “user” shall be the individual that uses electronic communication services accessible to the public for commercial or private purposes, not necessarily having subscribed to the service, while the “subscriber” shall be the individual or entity that has entered into an agreement with the entity that renders the electronic communications services. This distinction is particularly important for the regulation of services based upon users’ and/or subscribers’ location data, as well as for the users’ right to obtain a non-detailed invoice and the disclosure of the identity of the caller’s line and the connected line.

The directive precludes the use of automatic call forwarding systems for commercial purposes to subscribers who have not given their prior consent. In any event, and even if the subscriber’s consent has been granted, the user and/or the subscriber must always have notice of the origin of the communications, so as to have the possibility to pute an end to them. The Directive also establishes the obligation to previously inform subscribers, for free, of the inclusion of their data in directories and the obligation of the Member States to protect the subscribers’ right to decide whether or not their data should be included in said directories, at no cost to them.

Directive 2002/58/EC derogates Directive 97/66/EC of the European Parliament and the Council, of December 15, 1997, related to the processing of personal data and the protection of privacy in the electronic telecommunications sector, so every reference to the latter shall be considered made to Directive 2002/58/EC.

The Directive on privacy and electronic communications must be incorporated into Spanish internal Law of Member States by October 31, 2003.

The Directive on privacy and electronic communications entered into force on July 31, 2002.

Fundamental aspects of Law 34/2002 of Information Society services and Electronic commerce
Law 34/200, of information society services and electronic commerce (“LSSI”), of July 11, 2002.

By means of the LSSI, the Spanish Legislator has complied with the order of the European Legislator to incorporate into Spanish internal law Directive 2000/31 of the European Parliament and the Council, of 8 June 2000, on certain legal aspects of information society services, in particular electronic commerce in the Internal Market.

The LSSI clarifies the specific legal framework applicable to the implementation and use of the Internet and the new information technologies, which will help raise the level of confidence of the users of this new environment.

In particular, the LSSI sets out the legal regime applicable to the so-called information society services and contracts executed by electronic means in relation to: (i) obligations and liabilities of the service providers, including those that act as intermediaries in the transmission of data in the telecommunications networks –Articles 9 to 18-; (ii) commercial electronic communications –Articles 19 to 22-; (iii) contracting by electronic means –Articles 23 to 29-; (iv) judicial and extra-judicial conflict resolution –Articles 30 to 32-; (v) certain information and control obligations –Articles 33 to 36-; and, finally, (vi) infringements and penalties applied to those who fail to comply with this Law.

The scope of application of the LSSI depends on the State where the service provider is located. Thus, the LSSI shall fully apply to (i) service providers located in Spain and the services rendered by them; (ii) services providers domiciled or resident in other States but that offer information society services through a permanent establishment in Spain, and (iii) service providers located in another Member State of the European Union (“EU”) or the European Economic Space (“EES”), when the addressee of the services is in Spain and the services affect certain matters. Finally, the LSSI shall only be applied to service providers located outside the EU or the EES when they specifically direct their services to the Spanish territory, or when their activities affect certain matters considered of public order.

The LSSI is based on the principle of freedom to render services, which means, in part, that no prior authorisation will be required to render such services and, also, that no restrictions shall be placed upon the services rendered by entities established in the EU or EEE Member States for reasons derived from the co-ordinated regulation (concept which concerns the set of requirements contained in the LSSI applicable to the information society service providers related to the commencement or carrying out of their activities, the regulations that govern the carrying out of economic activities by electronic means, or the general applicable laws).

However, the most anticipated and characteristic feature of the LSSI is, probably, the regulation of (i) the requirements, obligations and liabilities that the information society services providers must comply with; (ii) the commercial electronic communications; (iii) contracting by electronic means; (iv) the so-called judicial and extra-judicial conflict resolution; and (v) the sanctions imposed upon those who fail to comply with the provisions of the LSSI.

As to the obligations of the information society service providers, these entities must communicate to the public Registry in which they are registered at least one domain name that identifies them on the Internet. They must also include on their web sites permanent, free and easy-to-read information about themselves and the services they render.

In addition, they must co-operate with the relevant authorities in order to guarantee the effectiveness of the applicable restrictive measures, including the interruption of services or the removal of certain contents. Likewise, service providers must retain for a 12-month period the traffic data generated and that will allow to identify the origin of the transmissions and the data, in order to provide this information to the administrative and judicial authorities.

With regard to the service providers’ liability regime, the LSSI does not alter the general Spanish legal liability regime, but merely sets out several particularities related to network operators and Internet access providers, entities providing temporary copy (caching) or data storage services, and service providers that include links to other web sites or search tools.

In most cases, the LSSI excludes service providers from liability derived from the contents transmitted, put up, or linked to by them, provided they are not aware of their illicit nature, do not modify the data, they do not select the addressee of such data, and the addressee of such data is not acting under the services provider’s authority, control, or direction.

In particular, the LSSI addresses commercial electronic communications (spamming); banning the transmission of promotional or advertising messages by e-mail or analogue methods if they have not been requested or expressly authorised by the addressee, who shall at all times be allowed to cancel such request or authorisation. These commercial electronic communications must be identified as such, (inserting the word “advertisement” at the beginning of the message) and include the name of the sender, be it an individual or a company.

The LSSI also regulates the contracting by electronic means, an area that is governed not only by the provisions of the LSSI but also, naturally, by the general legal civil and mercantile provisions governing contracts. In this way, the LSSI establishes the general principle that contracts executed by electronic means produce all the normal legal effects if the consent and other validity requirements are fulfilled, even if there has been no prior agreement to use this means of contracting. If the law imposes the written form for a specific type of contract, this requirement shall be fulfilled if the contract is executed electronically. If the contract should be executed through a public deed, the related specific regulations shall be applicable. Moreover, the LSSI modifies Articles 1262 of the Civil Code and 54 of the Code in Commerce, in order to unify the criterion of time and place of execution of electronic contracts and, in general, contracts executed in different locations. With regard to the time of execution, an offer is considered accepted when the acceptance is sent to the bidder, and the bidder cannot reasonably ignore it, and with regard to the place of execution, the contract is presumed to have been executed in the place where the offer was made (in electronic contracts, where the services provider is located), except if both parties agree on a different place. However, if one of the parties is a consumer, the place of execution will be his place of residence.

In addition, the LSSI imposes several information requirements upon the service provider, not only prior but also after the execution of the contract.

Finally, the LSSI regulates other relevant matters, among which it is necessary to mention the following:

The LSSI regulates a prohibition order to be applied against conducts contrary to the LSSI that harm consumers’ collective rights, and the establishment of penalties for non-compliance with its provisions.

Offences are classified as minor, severe, or very severe. Sanctions are imposed on a sliding scale and are determined in accordance with the criteria set out in the LSSI. Penalties of up to a maximum of €600,000 may be imposed, and may also include the publication of the decision. In the case of severe or very severe offences, temporary measures may be adopted in accordance with Law 30/1992, of November 26, on the legal regime of the Administration and the Administrative procedure, and coercive fines of up to €6,000 may be imposed for every day that the said measures are not complied with.

The LSSI also provides for the adoption of administrative measures to assist in the adaptation of Internet sites for disabled and elderly persons. Likewise, it provides for the modification of Royal Decree 1906/1999 regarding general terms on telephonic and electronic contracting, so as to adapt it to the LSSI.

In the same way, there are important modifications made to the General Telecommunications Law, especially in the area of universal service, the putting into practice of the plan of technological modernisation of access to the fixed telephony network, and a series of rules about the concession of domains “.es” and the related fees.

The LSSI entered into force October 12, 2002.

List of “dominant operators” in the Spanish fixed and mobile telephony markets, as well as in the interconnection market
Decision dated September 5, 2002, of the Board of the Telecommunications Market Commission (“CMT”) declaring Telefónica dominant operator in the fixed telephony, mobile telephony and leased lines markets, and Airtel Móvil, S.A. in the mobile telephony and leased lines markets.

As every year, and as provided in Article 23.2 the General Telecommunications Law, and taking into account the total income generated in year 2001 from the use of networks and the rendering of services in each of the aforementioned markets (fixed telephony, mobile telephony and leased lines), the CMT has attributed the condition of “dominant operator” in each of those markets.

In effect, from the information provided by the operators that participate in the fixed telephony, mobile telephony and leased lines markets, the CMT resolves that: (i) Telefónica de España, S.A.U. (“Telefónica”) obtained a market share of more than 87% in the fixed telephony market; (ii) Telefónica has a market share of 83% in the leased lines market; (iii) Telefónica Móviles España, S.A. (“TME”) has a market share greater than 60% in the mobile telephony market, while Airtel Móvil, S.A.’s market share is greater than 25%.

With regard to the interconnection market, the CMT has used the criterion of income arising from call-ending interconnection. As such, the market shares in 2001 were distributed in the following way: (i) Telefónica had a market share of between 20% and 25% of the calls ended in fixed telephony lines; (ii) TME has a market share of more than 40% of the calls ended in mobile telephony lines, while the market shares of Airtel Móvil, S.A. and Retevisión Móvil are between 15% - 20% and 10% - 15%, respectively.

Article 23.1 of the General Telecommunications Law defines dominant operators as those entities that have obtained, in a given geographical area (national, regional, or local), and in a certain given market, a market share greater than 25% of the gross global income generated by the use of lines or by the rendering of services. Notwithstanding this, an operator with a market share of less than 25% can be considered as a dominant operator by the CMT, while not all operators with market shares greater than 25% are necessarily considered dominant; there are several other complementary criteria that could be taken into consideration such as the capacity of the operator’s network, the capacity to influence market prices due to the nature of the services rendered, turnover, control over the access to end-users, access to financial resources, experience in the provision of products and services, and any other circumstance that can affect the competition conditions in the relevant market.

Taking into account the data provided by the operators, the CMT has attributed the condition of “dominant operator” to (i) Telefónica in the fixed telephony, leased lines, and interconnection markets, (ii) TME and Airtel Móvil, S.A. in the mobile telephony market, and (iii) Telefónica and Airtel Móvil, S.A. in the interconnection market.

The declaration as dominant operator imposes on Telefónica the following obligations: (i) to provide interconnection in transparent, objective and non-discriminatory conditions, (ii) to dispose of a Reference Offer for Interconnection (Oferta de Interconexión de Referencia, “OIR”), (iii) to give third parties access to the local loop, (iv) to offer cost oriented prices for interconnection, (v) to provide the CMT with separate accounts in relation to specific activities related to interconnection and (vi) obligations related to the Universal Service. TME and Airtel Móvil, S.A. must comply with the same obligations that apply to Telefónica, except for those related to the Universal Service and the availability of an OIR.

List of “main operators” within the nation-wide markets of fixed and mobile telephony
Decision dated July 30, 2002 of the Telecommunications Market Commission (“CMT”), that publishes the list of operators that, in accordance with the provisions of Article 34 of the Royal Decree-law 6/2000, dated June 23, 2000 (“Royal Decree-law”), are considered “main operators” within the nation-wide markets of fixed and mobile telephony services.

By virtue of the mentioned Decision, the CMT has established, as each year, the list of operators that are considered main operators within the nation-wide markets of fixed and mobile telephony services. This declaration imposes certain restrictions on these operators, as set out in Article 34 of the Royal Decree-law. These restrictions are related to voting rights and the right to appoint members of the Managing Body of various companies that are also considered main operators within the same market or sector. In turn, those individuals or companies that are shareholders with voting rights equivalent to three percent (3%) or more of the total capital or voting rights of more than one company considered as main operator within the same market or sector, shall not be able to exercise more than three percent (3%) of the relevant voting rights in more than one of those companies.

The most important feature of this Decision is that the term “main operator” is construed as the group of companies as a whole, and not as the company that renders its services in the relevant market. The reason for this change is that the CMT intends that term “main operator” takes into account the business and corporate reality of the relevant markets, where companies tend to segregate certain transactions to be executed by different companies although in practice they are acting as a single business unit. This new interpretation follows the precedents of the European Court of Justice, as well as the new EU regulatory framework contained in the Framework Directive (Directive 2002/21/CE of the European Parliament and Council on a common regulatory framework for electronic communications networks and services).

It is on the basis of this interpretation that the CMT has declared Telefónica Group, Jazztel Group and Cableuropa Group as main operators in the nation-wide market of fixed telephony,. Likewise, the CMT has declared the following groups as main operators in the nation-wide market of mobile telephony Telefónica Group, Vodafone Group, Auna Group and Xfera Group.

INDUSTRIAL PROPERTY

New Trademarks Regulation
Royal Decree 687/2002, of July 12, enacting the Regulations for the implementation of the Trademarks Law 17/2001, of December 7, published in the State Official Gazette on July 13, 2002.

The reform of the Spanish trademark system introduced by the Trademarks Law 17/2001, of December 7 (“Trademarks Law”), claimed for further development of said Law. This Regulation, enacted by means of Royal Decree 687/2002, of July 12, supersedes the Regulation for the implementation of the Trademarks Law of 1988 (enacted by means of Royal Decree 654/1990 of May 18). Likewise, it derogates the Regulation that adapts the Regulation for the execution of the Trademarks Law of 1988 to Law 30/92 (enacted by means of Royal Decree 441/1994 of March 11).

The regulation completes the provisions of the new Trademarks Law for their practical implementation, and is set out in 8 chapters (“Títulos”) addressing: (i) application for registration; (ii) registration procedure; (iii) renewal of trademarks; (iv) assignments, licences and transfer of other rights; (v) waiver of trademark rights; (vi) collective trademarks, quality trademarks and trade names; (vii) international and European trademarks; and (viii) general provisions regarding the relevant procedures.

From the content of the Regulation, the following provisions stand out among other equally important provisions:

With regard to the procedure, the Regulation includes novelties provided for in the new Trademarks Law (i.e. multi-class trademark and the suppression of the ex-officio control of registration relative prohibitions) and specifies the duties that the new Law entrusts to the Autonomous Regions following Constitutional Court judgement 103/1999.

Thus, the application form will be submitted to the competent body provided in Article 11 of the Trademarks Law, that is to say, to the competent body of the relevant Autonomous Region, which shall examine the formal requirements of the application in order to obtain a submission date. In addition, the formal requirements concerning the content of the registration application, the reproduction of the trademark, the list of designated products and services, the receipt evidencing the payment of the application fee, and the use of the official forms shall also be examined. The competent body of the Autonomous Region will then submit the application to the Spanish Patents and Trademarks Office, which shall examine its lawfulness, state any objections that may be made, and decide over its concession.

With regard to the modifications that can be introduced in trademark application forms, the Regulation introduces detailed provisions for each case, as well as addressing the possibility of dividing the application in several different ones.

Still in connection with the trademark registration procedure, the Regulation addresses the restitutio in integrum institution, or restoration of rights, introduced by the Trademarks Law in line with the European Trademark Regulation, and, more specifically, it sets out the content of the relevant application, and regulates the exam and resolution thereof.

Finally, the provisions of the Regulation are aimed at improving the relationships between the users and the Spanish Patents and Trademarks Office, in connection with the new trademarks Law, even if some of these provisions are still being implemented (i.e. communications with the Office via the presentation of documents in electronic or magnetic format, or the possibility of submitting the said documents by fax or other electronic devices). Likewise, the Regulation carefully discloses the content of the Trademarks Registry.

Royal Decree 687/2002 entered into force on July 31, 2002, as did the new Trademarks Law.

Partial cancellation of trademarks
Decision of the 1^st Chamber of the Supreme Court, of June 24, 2002.

The Supreme Court, analyses in its decision of June 24, 2002 the partial cancellation regime of trademarks provided for in the Trademarks Law 32/1988 (“Trademarks Law of 1988”), as compared to the regime provided in the First Directive 89/104/CEE of the Council, of December 21, 1988, concerning the approximation of Member States’ national laws for trademark issues (the “Directive”) and in the Trademarks Law 17/2001, of December 7 (“Trademarks Law”).

The claimant, who had requested the inscription of the trademark “Parranda” for a certain liqueur wine (aguardiente), urged the Office to declare the expiration of an identical trademark that was registered previously for class 33 products of the Nomenclature: “wines of all sorts, liqueur wine (aguardiente), anisette, and any similar liquors and alcoholic drinks”. This trademark had been used by its right-holder only for sangria. The inferior Tribunal’s decision reviewed by the Supreme Court had declared the partial cancellation of this trademark limiting its legal force only to alcoholic drinks of class 33 of the nomenclature.

Against this decision, the holder of the trademark subject matter of partial cancellation, asserted that, based on Article 4.4 of the Trademarks Law of 1988, the use of this trademark for sangria should extend to and protect the rest of products designated by the trademark, and, thus, there was no reason for the cancellation of the trademark with respect to those products.

The Supreme Court rejected a literal interpretation of Article 4.4 of the Trademarks Law of 1988 but made a joint interpretation of the said Article and of Article 54 of this Law, stating that one of the express purposes of the Trademarks Law of 1988 is to eliminate registered trademarks that are not in use and preclude the registration of new trademarks. It also stated that Article 4.4 is not adjusted to the Directive and it is therefore necessary to interpret it as close to the Directive as possible, and that, in this regard, the new Trademarks Law abolishes Article 4.4 of Trademarks Law of 1988. The contents of the new Trademarks Law seem to have been used by the Supreme Court as interpretation criteria of the Trademarks Law of 1988.

Apart from all this, it must be acknowledged, as does the Supreme Court, that during the whole legal conflict, the incompatible nature of the trademarks “Parranda” for sangria on one side, and for aguardiente, on the other side, was never addressed.

INTELLECTUAL PROPERTY

Joint liability of the publisher and the director of a video for infringement of intellectual property rights
Decision of the 1^st Chamber of the Supreme Court, of July 15, 2002.

In its decision of July 15, 2002, the Supreme Court solved an appeal that was originated by an action of the General Society of Authors and Publishers (“SGAE”, the Spanish author’s collecting entity) following an infringement of intellectual property rights. The basis for the claim was the distribution of a series of videos containing music with a newspaper. The use, reproduction, or distribution of the said videos had not been authorised by the relevant right-owners of the music. The claim was against the director of the video and the newspaper publishing company.

The Supreme Court held that the SGAE should receive compensation, consisting in the remuneration it would have obtained had the videos been adequately authorised, considering the compensation to be “reasonable” and “reasonably justified”.

The decision applies jointly to the director of the video and the newspaper publisher, despite the allegations made by the former claiming that he was merely complying with the publisher’s orders and by the latter asserting that he had nothing to do with the illegal act (the use of music without authorisation from the relevant right-owners).

In contrast with these allegations, the Supreme Court pointed out that the newspaper publisher could be assimilated in this case to an audio-visual recording producer, as he had the initiative and assumed the responsibility of the audio-visual recordings. On the other hand, the director of the video actually made the recordings; thus, he cannot be considered as a mere instrumental party or an incidental party in a services agreement.

In conclusion, the Supreme Court established that, with regard to the right-owners, both the newspaper publisher and the director of the video are responsible for the illegal act, regardless of the contractual terms inter partes governing the distribution of liability between them.

PHARMACEUTICAL LAW

Pharmacovigilance of medicinal products for human use
Royal Decree 711/2002, of July 19, 2002, which regulates the pharmacovigilance of medicinal products for human use.

Royal Decree 711/2002, of July 19, 2002, incorporates the Commission Directive 2000/38/CE, of July 5, 2000, which amends Chapter V bis, “Pharmacovigilance” of Directive 75/319/CEE, of the Council, on the approximation of provisions laid down by law, regulation or administrative action relating to medicinal products.

The Royal Decree regulates the pharmacovigilance of medicinal products for human use (which is defined as “the public health activity aimed at identifying, quantifying, evaluating and preventing risks associated to the use of such medicinal products”) as a joint responsibility of the agents of the Spanish Pharmacovigilance System (formed by the competent authorities - national and regional - and health professionals) and the marketing authorisation holders. It also sets out the regulatory framework that defines the obligations of each of said agents, and ensures the effective communication among them. Likewise, this Royal Decree regulates the scope of the administrative intervention in oharmacovigilance issues, as well as the post-authorisation studies.

Health products (“productos sanitarios”)
Royal Decree 710/2002, of July 19, 2002, which amends Royal Decree 414/1996, of March 1, 1996, on health products, concerning products which contain stable human blood or plasma derivatives.

Royal Decree 710/2002 sets out certain distinctive features on the regulation of health products which contain, as an integral part thereof, a substance deriving from human blood (such substance being defined as a substance “which, if used separately, may be considered as a medicinal product compound or a medicinal product deriving from human blood or plasma, and that may exercise in the human body an action ancillary to that of the product”). In general, such peculiarities imply the establishment of additional formalities and controls (relating, in particular, to their characteristics, manufacture and release) for these health products.

Inclusion of the local representative's logo in the blue box on the outer packaging of a medicinal product
Judgement of the Court of First Instance (Fourth Chamber), of July 3, 2002, case T-179/00, A. Menari–Industrie Farmaceutiche Riunite Srl vs. Commission of the European Communities

The Court of First Instance annulled the Commission's decision of 17 April, 2000 rejecting the request by the local representative of the marketing authorisation holder to include its logo in the blue box of the packaging of a pharmaceutical product registered under the centralised authorisation procedure (set out by Council Regulation no. 2309/93 of 22 July 1993, laying down Community procedures for the authorization and supervision of medicinal products for human and veterinary use and establishing a European Agency for the Evaluation of Medicinal Products ).

Unlike the Commission, the Court understood, on the one hand, that the inclusion of the local representative’s logo in the blue box is useful information for health education as it facilitates the identification of said representative and helps to increase consumer protection. On the other hand, the Court stated that the inclusion of said logo does not imply an additional risk of confusion between the responsibilities of the holder of the marketing authorisation (who is therefore responsible for the medicinal product) and those of the local representative (who is not), since other information related to the local representative (name and address) are already included in the blue box.

Withdrawal of parallel import licence as a consequence of the waiver of the marketing authorisation for the relevant medicinal product by the holder thereof
Judgement of the Court of Justice (Sixth Chamber) of September 10, 2002, case C-172/00, Ferring Arzneimittel GmbH vs. Eurim-Pharm Arzneimittel GmbH

By Judgement of September 10, 2002, the Court of Justice settled diverse prejudicial questions on the interpretation of Article 28 EC and Article 30 EC, that were raised in proceedings concerning the parallel import by a pharmaceutical laboratory into a Member State of a medicinal product manufactured by a different pharmaceutical laboratory and marketed in the same Member State.

The questions raised deal, principally, with the determination on whether Articles 28 and 30 EC eventually preclude a national regulation that establishes the automatic withdrawal of an parallel import licence where the holder of the marketing authorisation of the relevant medicinal product has waived such authorisation. In the case at hand, such waiver was caused by the replacement of the relevant medicinal product by a new version, which differed from the former one in respect of modified excipients that changed the storage conditions of the same.

The Court confirmed that the aforesaid national regulations amounted to a restriction to the free movement of goods contrary to Article 28 EC. In this case, such restriction is not justified by public health reasons, in accordance with Article 30 EC, since the reason for the withdrawal is that the holder of the authorisation has replaced the old version of the medicinal product with a new version. On the other hand, the restriction is also not justified by the need to ensure the necessary control of the quality, efficacy and non-toxic nature of the former version of the medicinal product, since the competent authorities of the member State in question may adopt measures which are less restrictive to importation for this purpose.

Likewise, the Court stated that, only if it were proven that the joint existence of two versions of a medicinal product in one Member State effectively entails a risk for public health, such risk could justify restrictions to the importation of the ols version of the medicinal product on the basis of the revocation of the marketing authorisation of the product in question by its holder with respect to such market.

Parallel import of medicines authorised following the central marketing authorisation procedure for the commercialisation of re-packaged products including the trademark
Judgment of the Court of Justice (Sixth Chamber), of September 19, 2002, case C-433/00, Aventis Pharma Deutschland GmbH vs. Kohlpharma GmbH y MTK Pharma Vertriebs-GmbH

By Judgement of September 19, 2002, the Court of Justice settled the prejudicial question relating to the the legal possibility of a medicinal product, subject matter of two different central marketing authorisations for packs containing five cartridges and for packs of 10 cartridges, respectively, being commercialised in the Member State of importation, in a package consisting of two packs of five cartridges which have been joined together and relabelled,, in accordance with Council Regulation (EEC) no 2309/93 of July 22, 1993 laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Agency for the Evaluation of Medicinal Products (“Regulation no 2309/93”).

The Court stated that each marketing authorisation of a medicinal product granted in accordance with Regulation no 2309/93 refers to certain dimensions and/or format, a specific presentation (size and shape of the packaging), and even to the particulars and information to be printed on the product packaging, as they were foreseen for such product in the relevant relevant marketing authorisation application.

Thus, the Court considered that the central marketing authorisation of a medicinal product for the pack of ten cartridges does not allow for the marketing of said medicinal product, imported from a Member State to another, with a multiple package, resulting from the bundling and relabelling of two five-cartridge packages, forming a new sales unit.

The Court referred to the competent national courts the matter of examining whether the circumstances prevailing at the time of marketing in the Member State of importation make the creation packagings of ten cartridges of new packagings of ten cartridges (by repackaging the medicinal product imported in five-cartridge packagings) “objectively necessary”, in accordance with the case law of the Court of Justice, in order that the imported medicinal product can gain effective access to the market of that State.

FOOD LAW

Approval of the Spanish Food Safety Agency's Statute
Royal Decree 709/2002, of July 19, 2002, which approves the Statute of the Spanish Food Safety Agency

In accordance with the provisions of Law 11/2001, of July 5, that creates the Spanish Food Safety Agency, this Agency is formed as an autonomous entity reporting to the Ministry of Health, with individual legal personality and full capacity to act.

The main purpose of the Spanish Health Safety Agency is to promote health safety as a fundamental part of public health, offering guarantees to consumers and economic agents of the agri-foodstuffs sector. On the other hand, pursuant to the aforesaid Law 11/2001, the Spanish Health Safety Agency may pursue its goals by acting in any other areas that may be allocated to it in the light of scientific progress and new social demands.

The Spanish Health Safety Agency must at all times be co-ordinated with the competent authorities in exterior health issues, and has, inter alia, the following duties:

·        to carry out the study and follow-up of food transmissible diseases.

·        to propose to the competent authorities the enactment of regulations in this matter. Likewise, the Agency shall be consulted on certain general regulations, in the cases where they may affect health safety.

·        to provide the competent authorities with advice in their regulating activities, as well as advice concerning human nutrition.

·        to evaluate the risks of new food products, ingredients and processes.

·        to co-ordinate, in a centralised manner and in close relationship with the territorial competent authorities, a System of Rapid Exchange of Information or Food Alert Network, by means of which any information that may affect, in a severe and eventually immediate manner, consumers’ health, shall be made public. Likewise, the Agency shall act as contact point in Spain within the European Community -Service of Rapid Information Exchange.

·        to manage the General Health Registry of Food Products.

This Royal Decree approves the Statute of the Agency and implements the necessary regulations for its effective incorporation, start up, organisation and running.

Royal Decree 709/2002 entered into force on July 27, 2002.

Catalonia: Enactment of the Food Safety Law
Law 20/2002 of the Parliament of Catalonia, of July 5, on Food Safety.

By means of this Law, the Generalitat of Catalonia, exercising the legislative powers granted by its Particular Statute related to hygiene and health, agriculture and cattle raising, consumer protection and environment, sets out the mechanisms to provide an adequate response to the new aims and social requirements within the scope of food safety. The purpose of this Law is to establish a new regulatory framework for food issues that implements a high level of guarantees with respect to food safety, granting Catalonia a powerful means to determine, manage and inform efficiently regarding the risks involved in food consumption.

The Law is divided into three Chapters: Chapter I sets out the scope of this regulation and defines the most relevant concepts in order to ensure a common, unequivocal language. Chapter II sets out the aims, principles and requirements of the involvement of public authorities and economic agents in food safety. Finally, the Law creates the Catalonian Agency of Health Safety in Chapter III.

The fundamental principles of the food safety policies shall be based on the risk-analysis procedure as the most appropriate means to guarantee an adequate level of protection and reliance among consumers, taking into consideration the evaluation, management and communication of risks.

The traceability principle is given special relevance: it shall allow for a follow-up of the products through all the stages of the food chain, in order to ensure the safety of the products placed in the market and, if applicable, facilitate the withdrawal of the same in cases of risks to consumers’ health.

The Law also endorses the principle of transparency, as an expression of the citizenship’s right to an adequate knowledge of the collective health problems that entail risks.

Another elementary principle of the law is the precaution principle in food issues, which shall allow for the adoption of precautionary risk management measures, while waiting for additional scientific information which permits exhaustive risk evaluation. These measures shall be adopted in a transparent, balanced manner and shall be revised within reasonable periods of time.

Likewise, the Law sets out the principle of responsibility of food firms, through the establishment of self-control procedures and obligations to inform and co-operate with the competent authorities, with a view to guaranteeing the firms’ compliance with food safety regulations.

Finally, the Law creates the Catalonian Agency of Food Safety (which shall be incorporated within six months following the enactment of the Law), integrated within the Public Administration of the Generalitat, as an autonomous entity reporting to the Department for Health and Social Security Department and a reference with regard to food safety in Catalonia. This institution will essentially fulfil the following duties: (i) to set out directions in order to enhance the activities of the different departments of the Generalitat and the municipal institutions in this matter; (ii) to draft and approve the Catalonian Food Safety Plan as a tool and a reference for food safety policies and (iii) to co-operate with the institutions which exercise similar duties at national and Community level and with the competent public authorities.

The European Court of Justice defines the concept of force majeure applicable within the framework of agriculture regulation
Within the community regulatory regime on export restrictions, the first paragraph of Article 11 of EC Commission Regulation no. 3665/87, states that, where it has been found that an exporter, with a view to the granting of an export refund, has requested a refund in excess of the applicable refund, the refund due for the relevant exportation shall be the refund applicable to the actual exportation reduced by an amount equivalent to half the difference between the refund requested and the refund applicable to the actual exportation. This penalty, however, shall not apply, inter alia, in cases of force majeure.

In 1996, the German firm “Käserei Champignon Hofmeister GmbH & Co. KG” (“KCH”) exported cheese spread manufactured by a third party, and was granted, under cover of an export declaration, an export refund as an advance payment from the Hauptzollamt. An examination of a sample taken from one of the consignments at the time of export revealed that the goods contained vegetable fat and ought, as a food preparation, to have been qualified as a as a food preparation and, thus, assigned a code different from the one under which it was declared, and which did not give rise to entitlement to an export refund.

As a consequence thereof, the Hauptzollamt Hamburg-Jonas claimed from KCH the payment of the above referred penalty, for having applied for an export refund with respect to a product which does not entitle it to such refund. KCH brought an application to have that decision annulled before the Finanzgericht Hamburg, which was rejected. KCH then brought an application for review before the Bundesfinanzhof.

KCH argued that it was in a situation of force majeure as contemplated in the case-law of the Court, that is, external, abnormal and unforeseeable circumstances, whose consequences could not have been avoided in spite of the exercise of all due care, since (i) the incorrect information in its refund application was based on inaccurate information from the manufacturer, a reputable company in Germany; (ii) it was a production line manager there who took the initiative to add vegetable fat to the exported cheese spread; and (iii) this constituted a totally unexpected and unusual event, since it could not be detected by the usual tests, which KCH had effectively carried out, but only through tests carried out at the manufacturing plant.

In such circumstances, the Bundesfinanzhof referred to the Court, inter alia, he following question: Can Article 11(1) of Regulation No 3665/87 be interpreted as meaning that false information provided in good faith by the refund applicant on the basis of inaccurate data supplied by the manufacturer constitute a case of force majeure where the applicant could not establish that it was false or could do so only by means of tests at the undertaking in which the goods were manufactured?

In its judgement, the Court of Justice recalls that the concept of force majeure in the sphere of agricultural regulations must be construed as referring to abnormal and unforeseeable circumstances beyond the control of the trader concerned, whose consequences could not have been avoided in spite of the exercise of all due care.

The facts referred by KCH, even if constituting a circumstance beyond the control of the exporter, cannot be considered to be unforeseeable in the context of commercial transactions. The exporter is free to stipulate certain levels of quality in his contractual dealings with his trading partners and may require them to carry out stringent tests and notify him of the results, or state that he himself may carry out certain tests at the company where the goods were manufactured or entrust that task to independent bodies. On the other hand, the exporter is free to select his trading partners and it is up to him to take the appropriate precautions, either by including the necessary clauses in the contracts in question or by effecting appropriate insurance.

In the Court’s view, Regulation no. 3665/87 takes into consideration the exporter’s role as the last participant in the chain of production, processing and exporting of agricultural products and, thus, makes him responsible for the accuracy of his declaration, since he is able to ensure that irregularities do not occur. This can be implemented through contractual clauses aimed at obtaining from his contracting partners products which comply with Community provisions. The Court concluded that Article 11(1) of Regulation no. 3665/87 is to be interpreted as meaning that false information provided in good faith by the refund applicant on the basis of inaccurate data supplied by the manufacturer of the exported goods does not constitute a case of force majeure. Fault on the part of a co-contractor is an ordinary commercial risk and cannot be regarded as unforeseeable in the context of commercial transactions, as the exporter has various means at his disposal to protect himself against such risk.