Car Manufacturers’ Trademarks and Car Parts – The CJEU Does Not Change Its Mind

Several years after the historic Wheeltrims ruling, the EU Court of Justice has again tackled the issue of the reproduction of car manufacturers’ trademarks affixed to non-original auto spare parts, which has been at the centre of a long-standing battle between car manufacturers and aftermarket suppliers. The issue was addressed with the preliminary ruling of 25 January 2024 in case C-334/22 Audi.

The case started when Polish customs authorities seized a shipment of non-OEM radiator grilles for Audi vehicles from the 1980s and 1990s, imported by a Polish auto parts wholesaler. The customs seizure was followed by the filing, by Audi, of a motion seeking the destruction of the shipment and an injunction against the importer from importing, promoting, and marketing the grilles in the suit.

The grilles included in the shipment, like the genuine ones, had a space for inserting and mounting the car manufacturer’s emblem (the famous four intertwined rings), which is also covered by an EU registered trademark; with the outline of the carved out space corresponding to the outline of Audi’s trademark. In Audi’s view, importing the grilles and offering them for sale constituted trademark infringement.

The Regional Court of Warsaw, before which the motion was filed, considered that the dispute required the resolution of preliminary questions of Community Law that needed to be submitted to the Court of Justice.

Stressing the need to preserve undistorted competition between car manufacturers and independent aftermarket operators in the auto parts market, the Polish judge asked the CJEU whether, when considering the absence in Regulation 2017/1001 (hereinafter, EUTM Regulation) of a ‘repair’ clause, similar to that found in the Design Regulation[1], Article 9(2) and (3)(a) to (c) of the EUTM Regulation must be interpreted as meaning that importing and marketing radiator grilles like those in the suit qualify as using a sign in the course of trade in a manner liable to affect one or more of the functions of that trade mark.

Furthermore, the referring judge asked if Article 14(1)(c) of the EUTM Regulation precludes the manufacturer of the motor vehicles, which is the owner of an EU trade mark, from prohibiting a third party from using a sign identical with, or similar to, that trade mark in relation to such radiator grilles, where that sign consists of the shape of an element of the radiator grille designed for the attachment thereto of the emblem representing that trade mark, irrespective of whether it is technically possible to attach that emblem to that radiator grille without affixing that sign to it.

In addressing the first question, the Court referenced the Wheeltrims ruling: in the context of EU trademark law, the goal of preserving undistorted competition, limiting, in some cases, the exclusive rights conferred on trademark owners by the EUTM Regulation, is guaranteed by the provisions in Article 14 of the same Regulation; the latter constitutes a specific and self-sufficient set of rules and it would not be admissible to introduce further limitations applying by analogy the "repair clause" included in the Design Regulation.

Having thus commented, the Court noted that the notion of "use" of a third party’s trademark relevant under the EUTM regulation is not defined by the Regulation itself, and that the only delimitation, derived from case law, is that the relevant use is one capable of affecting one or more functions of the trademark, namely that of guarantee of origin, guarantee of quality and communication, investment, and advertising.

In this regard, the Court found (thus departing from the opinion of the Advocate General) that a shape similar or identical to a trademark present in a spare part for motor vehicles – in this specific case, as an element for fixing an emblem reflecting the trademark itself – constitutes a "sign", without the fact that it is an element of a spare part being capable of modifying this finding.

It follows that the incorporation of the sign in the grilles constitutes "affixing the sign on the product" pursuant to art. 9 paragraph 3 of the EUTM Regulation, and, consequently, the importation and offer for sale of the same grilles, in turn, constitutes a use of the sign typified by paragraph 3.

Indeed, according to the Court, this "... is all the more so where, as in the present case, that element is placed on the spare part, namely the radiator grille, in such a way that, as long as the emblem representing the vehicle manufacturer’s trade mark is not affixed, the sign identical with, or similar to, that trade mark is visible to the relevant public when it sees that part, that public being the one wishing to purchase such a part in order to repair or have repaired a motor vehicle. Such a fact is capable of establishing the existence of a material link between that part, which a third party imports, advertises and offers for sale, and the proprietor of the AUDI trademark."

According to the Court, this use is capable, in abstract, of compromising one or more functions of the trademark; it is up to the referring judge to establish whether, in concrete terms, one or the other of the cases referred to in art. 9, paragraph 2 of the Regulation (dual identity, risk of confusion or protection of a well-known trademark) occurs.

With regard to the second question, the Court noted that the limitation of the exclusive rights of the trademark owner, referred to in art. 14 of the Regulation, has the purpose of enabling suppliers of goods or services which are complementary to the goods or services offered by the proprietor of a trade mark to use that trade mark in order to inform the public of the intended purpose of the goods which they market or of the service which they offer.

In the present case, however, the affixing of the sign to the product - in the form of a housing for mounting the emblem reproducing the sign - is guided by the desire to market a radiator grille which resembles as closely as possible the original radiator grille of the manufacturer of the motor vehicles at issue.

In these circumstances, according to the Court, it is not relevant whether or not there is an alternative technical possibility (to that which requires the reproduction of the trademark) of fixing the emblem that reflects the trademark on the grille; the use of the sign must be assessed in light of the rules referred to in Article 9 of the EUTMR, and art. 14 of the EUTMR cannot be invoked to limit the rights of the trademark owner.

The ruling is consistent with previous case-law on the use of trademarks on car spare parts, but in an even more restrictive sense, and it is bad news for non-OEM spare parts dealers: none of the proposed modifications of the Design Regulation will be sufficient to avoid conflicts with car manufacturers, every time the original spare part at issue bears their trademark; unless, of course, the former give up on reproducing the trademark.

[1] The reference is to the transitional provision at Article 110 of Council Regulation (EC) no. 6/2002 on Community Designs: “Until such time as amendments to this Regulation enter into force on a proposal from the Commission on this subject, protection as a Community design shall not exist for a design which constitutes a component part of a complex product used within the meaning of Article 19(1) for the purpose of the repair of that complex product so as to restore its original appearance.” This transitional provision is currently the subject of proposed amendments contained in the so-called "designs package", see https://www.consilium.europa.eu/en/press/press-releases/2023/12/05/council-and-parliament-strike-provisional-deal-on-design-protection-package/