#ECJ: A custodial sentence of a minimum of five years for #trademark #infringement may prove to be disproportionate #Bulgaria

Criminal proceedings for the infringement of trade marks were brought in Bulgaria against the owner of an
undertaking selling clothes. The Bulgarian authorities conducted an inspection in a commercial establishment
rented by the undertaking. They found that the signs affixed on the goods were similar to already registered trade
marks. The trader was charged before the competent Bulgarian court in respect of use of trade marks without the
consent of their proprietors. The Bulgarian legislation contains provisions which define the same conduct both as a
criminal offence and as an administrative offence.
That court has asked the Court of Justice for clarification on the compatibility with EU law of the Bulgarian law
penalising trade mark infringements, given that the penalties provided for are severe and the absence of a clear and
precise criterion as regards categorisation as a criminal or as an administrative offence leads to contradictory
practice and unequal treatment of litigants who have committed practically the same acts.
In the first place, the Court recalls that trade mark infringement may be categorised by national law both as an
administrative offence and as a criminal offence. In that regard, it points out that, according to the principle of
the legality of criminal offences and penalties, criminal law provisions must be accessible, predictable and clear as
regards the definition of the offence and the sentencing. Thus, every citizen must understand which conduct will
make him or her criminally liable.

The fact that trade mark infringement may also give rise to administrative
penalties in Bulgaria does not mean that that principle has not been observed.
In the second place, the Court finds that a national provision which, where a trade mark is infringed repeatedly
or with significant harmful effects, provides for a custodial sentence of a minimum of five years is contrary
to EU law.

The Court states that, even though the directive on the enforcement of intellectual property rights 1
does not apply in criminal matters, pursuant to the TRIPS Agreement 2 , which binds both the European Union and its
Member States, those Member States may impose a custodial sentence for certain acts of trade mark infringement.
Admittedly, in the absence of EU legislation, the Member States have the power to determine the nature and level of
the applicable penalties.

Nevertheless, those punitive measures must be proportionate. Making provision for a
custodial sentence of a minimum of five years for all cases of unauthorised use of a trade mark in the course of
trade does not satisfy that requirement. Such legislation fails to take account of any specific aspects of the
circumstances in which those offences were committed.

https://curia.europa.eu/jcms/upload/docs/application/pdf/2023-10/cp230159en.pdf