A European distributor sources branded goods legitimately in Poland, ships them to France, and places them on the market. The French trademark holder seeks to block the sale. Who prevails? The answer turns on one of the most commercially significant doctrines in European intellectual property law: rights exhaustion. In France, this doctrine sits at the intersection of domestic trademark rules, EU-wide harmonisation, and the practical realities of cross-border trade. The gap between what the statute says and what courts actually demand is wider than many international businesses expect.
Parallel import in France is governed by the principle of EU-wide exhaustion of intellectual property rights. Once a rights holder – or a party with consent – places goods on the market within the European Economic Area, the rights holder cannot use trademark or copyright law to block resale in France. The principle applies to trademarks, copyright-protected goods, and certain patented products, subject to a set of well-defined exceptions. The Cour de cassation (France's Supreme Court of Private Law) has consistently held that exhaustion is extinguished where goods have been altered, repackaged without consent, or placed outside the EEA before entry into France.
This analysis examines the doctrinal foundations of IP rights exhaustion in France, the competing judicial interpretations that create practical uncertainty. The gap between formal rules and market reality, cross-border implications for European and international businesses. Additionally, the strategic recommendations that emerge from current case law trends.
Doctrinal foundations: from national to EU-wide exhaustion
France historically applied a national exhaustion rule: once goods were placed on the French market by or with the consent of the rights holder, the IP right was considered spent in France alone. Imports from other countries – even where the goods were genuine – could still be blocked.
EU harmonisation fundamentally changed this position. Under EU intellectual property legislation, exhaustion operates at the level of the European Economic Area. A rights holder who places goods on the market anywhere within the EEA cannot invoke trademark law to prevent those goods from moving freely between member states. This is the principle of EEA-wide exhaustion, and it applies directly in France by virtue of EU regulation and its transposition into French intellectual property legislation.
The rationale is straightforward. The EU internal market requires free movement of goods. Allowing a rights holder to segment markets by invoking national IP rights would undermine that principle. French commercial legislation – including relevant provisions of the Code de commerce (French Commercial Code) – reinforces this by prohibiting market-partitioning behaviour that restricts intra-EU trade.
International exhaustion is treated differently. Goods placed on the market outside the EEA – in the United States, Japan, or Brazil – do not trigger EEA exhaustion. A French rights holder can, in principle, block re-importation of goods first placed in a non-EEA territory, even where those goods are authentic. This boundary creates significant commercial leverage for brand owners, and it is frequently contested in litigation.
The burden of proof in exhaustion disputes sits primarily with the importer. A party asserting that goods were first placed on the EEA market by or with the rights holder's consent must demonstrate that fact. French courts, consistent with EU judicial guidance, have confirmed that this burden does not shift unless the importer can show a real risk that territorial restrictions would partition the market. Where that risk is established, courts may require the rights holder to prove non-exhaustion.
For companies structured as a SARL (société à responsabilité limitée. a limited liability company) or a SAS (société par actions simplifiée. a simplified joint-stock company) distributing branded goods across Europe. The exhaustion analysis begins with a deceptively simple question: where were the goods first placed on the market, and by whom?
Competing judicial interpretations and the consent problem
The most contested element of the exhaustion doctrine in France is consent. Exhaustion applies only where goods have been placed on the EEA market "with the consent" of the rights holder. French courts and EU tribunals have developed a substantial body of interpretive guidance on what that phrase means in practice.
Consent is not limited to express contractual permission. The Cour de cassation has confirmed that implied consent can suffice. However, it must be established with certainty. A mere contractual silence regarding resale or export does not automatically constitute implied consent. Courts examine the entire commercial relationship between the rights holder and the first seller: licensing agreements, distribution contracts, course of dealing, and any restrictions expressly imposed on resale.
This creates a significant practical gap. Many international licensing arrangements are drafted without explicit territorial resale restrictions. The licensee sells goods into the EEA. A parallel importer then acquires those goods and sells them in France. The rights holder argues the licensee lacked authority to trigger exhaustion. The importer argues that placing goods on the EEA market was itself the consent-triggering act.
French courts have not resolved this tension uniformly. Some decisions hold that an authorised first sale within the EEA is sufficient to exhaust rights regardless of downstream contractual restrictions, provided those restrictions were not communicated to the goods themselves or to the market. Other decisions take a narrower view, treating contractual limitations on the original sale as conditions that prevent exhaustion from arising at all.
The practical consequence is that parallel importers operating in France face meaningful litigation risk even where goods are genuinely of EEA origin. An infringement claim – an action en contrefaçon – can be filed by the rights holder as a first step. Placing the importer immediately on the defensive and imposing legal costs regardless of the underlying merits. Huissiers de justice (bailiffs with investigative powers in France) can be engaged to conduct dawn raids on warehouse premises under a saisie-contrefaçon procedure, which allows seizure of evidence and infringing goods before trial.
An importer unfamiliar with French procedure may find that the saisie-contrefaçon – a tool of IP enforcement deeply embedded in French intellectual property legislation – moves faster than any defensive response can be organised. Speed of reaction is therefore as important as the underlying legal merits.
For pharmaceutical and branded consumer goods, an additional layer of complexity arises from repackaging. EU law permits a parallel importer to repackage pharmaceutical products in certain defined circumstances. French courts apply a five-condition test drawn from EU judicial guidance: the repackaging must be necessary to access the market, must not affect the original condition of the product. Must identify the repackager, must give prior notice to the rights holder. Additionally, must preserve the reputation of the trademark. Failure on any single condition restores the rights holder's ability to block the import.
Businesses engaged in the IP registration and active management of trademark portfolios should note that the strength of an exhaustion defence is often inversely related to the quality of the rights holder's documentation. A well-maintained trademark portfolio – with clear consent mechanisms in licensing agreements – makes it harder for parallel importers to invoke exhaustion and easier for rights holders to pursue infringement claims. Conversely, poorly documented licensing chains tend to benefit importers, who can more easily argue that exhaustion occurred.
For a tailored strategy on IP rights protection and parallel import management in France, reach out to info@ferrazwhitmore.com.
The gap between statute and market practice
French IP legislation sets out the exhaustion principle in clear terms. The commercial reality diverges from that clarity in several important ways.
First, the international supply chain often obscures first-sale geography. Goods manufactured in Asia, shipped to a European free-trade zone, relabelled, and then sold to an EEA distributor create genuine ambiguity about where the "first placing on the market" occurred. Rights holders exploit this ambiguity. Importers in France are then required to reconstruct the full chain of title – a costly and time-consuming exercise that itself functions as a deterrent to parallel trade.
Second, trademark application strategy has become a tool in exhaustion litigation. Rights holders with carefully segmented trademark registrations. covering different product specifications, packaging formats. Alternatively. Nice classification categories across EEA jurisdictions. can argue that the goods sold in France do not correspond to the goods covered by the trademark registration in the originating country. This argument has had partial success in French courts and creates real risk for importers who do not conduct thorough trademark clearance before entering the market.
The Nice classification system – the international system for classifying goods and services for trademark purposes – is used in both the French national trademark system and in EU trademark applications. Parallel importers who find that goods are registered under different class combinations in different EEA member states face a strategic disadvantage: the rights holder can argue that exhaustion of a trademark in class 5 (pharmaceuticals) does not exhaust the same mark registered in class 3 (cosmetics). Even where the product is substantively identical.
Third, opposition proceedings before the Institut National de la Propriété Industrielle (National Institute of Industrial Property. France's trademark registry) are increasingly used as an ancillary tool by rights holders seeking to neutralise parallel importers who have their own registered marks. A parallel importer who has registered a local brand that incorporates elements of the original mark may face an opposition proceeding designed to cancel that registration. Removing the importer's ability to use a protected mark on repackaged goods.
Fourth, the enforcement infrastructure in France disproportionately favours rights holders in the early stages of a dispute. The saisie-contrefaçon procedure can be initiated on an ex parte basis – without notifying the importer in advance. French customs authorities cooperate actively with rights holders who have filed border-protection notices under EU customs legislation. Goods can be detained at the border for a defined period while the rights holder decides whether to pursue infringement proceedings. An importer without established French legal counsel is at a structural disadvantage from the first moment of enforcement action.
The interaction between these procedural tools and the substantive exhaustion doctrine means that winning on the law is only part of the challenge. Surviving the process – absorbing enforcement costs, managing detained inventory, and responding to parallel litigation – is a distinct commercial challenge that many international businesses underestimate when entering the French market.
Businesses managing cross-border IP strategy should also consider the parallel considerations that apply to parallel import and IP rights exhaustion in Portugal, where similar EEA exhaustion principles apply but procedural enforcement tools differ materially.
Cross-border implications for European and international businesses
France does not operate its IP exhaustion rules in isolation. The EEA-wide exhaustion principle means that a dispute about parallel import in France is almost always also a question about the distribution system across multiple EU member states.
For an international business with a selective distribution network across Europe, parallel imports into France can undermine carefully constructed pricing differentials. Premium goods sold at lower prices in Southern or Eastern European markets – where consumer purchasing power differs – will attract parallel traders seeking to arbitrage those price gaps. The brand owner's ability to prevent this depends entirely on how the distribution agreements are drafted and whether adequate export restrictions were incorporated at the point of first sale.
EU competition law intersects with IP law here in ways that create additional complexity. Under EU competition rules, absolute territorial restrictions on resale within the EEA are generally prohibited. A manufacturer cannot contractually prevent an authorised distributor from selling to customers in other EEA member states. This means that a rights holder's attempt to use IP law as a substitute for a banned contractual restriction will be examined critically – both by courts and by competition authorities.
The Autorité de la concurrence (French Competition Authority) has shown willingness to treat IP-based market-partitioning strategies as potentially abusive where the rights holder holds a dominant position. For large brand owners in concentrated markets. This creates a constraint on the aggressive use of exhaustion arguments: the same legal strategy that might succeed before a civil court could attract competition law scrutiny before an administrative regulator.
For businesses operating between France and non-EEA jurisdictions – notably the United Kingdom post-Brexit – the exhaustion position has changed materially. Goods placed on the UK market after the Brexit transition period do not trigger EEA exhaustion. A brand owner can now, in principle, block goods placed on the UK market from being re-imported into France. This is a significant change from the pre-Brexit position and has operational consequences for businesses that maintained integrated EU-UK distribution networks.
The UK has adopted its own exhaustion rules, which currently recognise EEA exhaustion for goods imported into the UK from the EEA, but this position is subject to ongoing policy review. The asymmetry – France recognises EEA exhaustion but not UK exhaustion; the UK recognises EEA exhaustion but its future policy remains uncertain – creates structural risk for cross-border distribution chains that span both markets.
For businesses with substantial IP portfolios operating across Europe, the IP services available for the French market address both the offensive and defensive dimensions of parallel import management, from trademark portfolio structuring to enforcement action.
Technology-intensive businesses also face a specific variant of the parallel import problem at the intersection of IP and AI-assisted market analysis. Where machine-learning tools are used to monitor pricing and distribution patterns across EEA markets. The legal status of data gathered through those tools interacts with IP and competition law in ways that French courts have only begun to address. The emerging body of AI law in France is increasingly relevant to distribution compliance and IP enforcement strategy.
To discuss how EEA exhaustion and parallel import rules apply to your distribution network in France, contact us at info@ferrazwhitmore.com.
Strategic recommendations and risk management
The analysis above points toward a set of concrete strategic positions that international businesses should adopt in relation to parallel import and IP rights exhaustion in France.
For rights holders seeking to protect distribution networks, the priorities are as follows. Distribution agreements should include clear, documented restrictions on resale outside assigned territories – drafted to comply with EU competition law. Licensing contracts should expressly state whether a licence confers the right to trigger exhaustion. Trademark portfolios should be structured so that key brands are registered consistently across EEA territories, using matched Nice classification categories, to prevent the segmentation argument from being used by importers. Rights holders should file border-protection notices with French customs and maintain standing instructions to customs authorities on how to identify infringing imports.
The saisie-contrefaçon procedure should be treated as a standard first response to suspected parallel imports, not an emergency measure. French IP litigation counsel should be retained in advance of any detected infringement, so that enforcement can begin within days of discovery rather than weeks.
For parallel importers operating in France, the risk mitigation strategy begins with due diligence on chain of title. Before committing to a parallel import transaction. Importers should verify: the first placing on the market and its EEA location. the identity of the seller in the originating country and their relationship to the rights holder. any express export restrictions communicated in the original sale. the trademark registration status of the relevant mark in both the originating country and France. and the condition of the goods and their packaging.
Self-assessment: a parallel import strategy in France is defensible where:
- Goods were first placed on the EEA market by the rights holder or with documented consent
- No express resale or export restriction was incorporated into the original sale
- The trademark registration in France and the originating country covers identical Nice classification categories
- Goods have not been repackaged, or repackaging satisfies all five conditions recognised by French courts
- No competition-sensitive pricing or territorial arrangement is at risk of regulatory scrutiny
Before initiating parallel import activity in France. Verify: the chain of title documentation. the full trademark clearance across relevant Nice classifications. compliance of any repackaging with French pharmaceutical or consumer goods regulation. and the absence of customs-hold notices filed by the rights holder with French customs authorities.
A shift in strategy is warranted when any of the above conditions is not met, or when a saisie-contrefaçon procedure has already been initiated. At that point, the matter transitions from a commercial distribution question to an active infringement dispute. requiring immediate French IP counsel. A defensive submission to the court. Additionally, in many cases an application to set aside the seizure order on procedural grounds.
The Ferraz & Whitmore perspective: doctrine, practice, and the bilateral tradition
The exhaustion doctrine in France illustrates a pattern familiar to practitioners working across civil law and common law systems. The statutory rule is relatively clear. The doctrinal elaboration by courts adds significant layers. The gap between the two is filled by procedure – and that procedural gap systematically advantages parties with local expertise and prepared enforcement infrastructure.
A client from a common law jurisdiction. accustomed to a system where judicial precedent directly shapes legal outcomes and where discovery processes allow aggressive pre-trial fact-gathering – will encounter a structurally different environment in France. The civil law tradition of the French system means that the written record governs more heavily than oral argument. Procedural tools such as the saisie-contrefaçon have no direct common law equivalent; they combine investigative and enforcement functions in ways that a party expecting a Mareva injunction or Norwich Pharmacal order must reconceptualise.
Conversely, the EU dimension of French IP law borrows heavily from a harmonised European body of legal doctrine developed through EU judicial guidance and regulation. Practitioners from EU civil law backgrounds will find that familiarity with EU trademark and exhaustion doctrine translates readily to French proceedings, though the specific procedural mechanisms remain distinctly French.
The practical lesson is that success in parallel import disputes in France requires both doctrinal command and procedural readiness. A well-prepared exhaustion argument that arrives at court after a saisie-contrefaçon has already immobilised the client's warehouse is a strategic failure, regardless of its legal merits.
The outlook for this area of law is shaped by two converging forces. First, EU-level harmonisation of IP enforcement continues to develop, with ongoing legislative attention to digital and cross-border trade. The rules governing exhaustion in digital markets. where "placing on the market" may occur through a download or software licence rather than a physical transfer of goods. remain contested in French courts and are likely to generate significant new jurisprudence over the coming years. Second, the post-Brexit asymmetry between UK and EEA exhaustion rules creates structural uncertainty for any business managing integrated supply chains across the Channel. Until the UK's long-term exhaustion policy is settled, that uncertainty is a permanent feature of the commercial environment.
Businesses that treat IP rights exhaustion as a compliance checkbox rather than a strategic variable will find themselves exposed in both directions: as rights holders unable to enforce territorial distribution strategies. Additionally. As importers facing costly enforcement actions that could have been avoided with better pre-transaction due diligence.
Frequently asked questions
Q: Can a French trademark holder block goods that were first sold in Germany by an authorised distributor?
A: Generally, no. Once goods are placed on the EEA market by the rights holder or with consent, EEA-wide exhaustion applies and the rights holder cannot use trademark law to prevent resale in France. However, if the original sale included express resale restrictions, or if the goods have been repackaged, the rights holder may be able to revive enforcement rights. The outcome depends heavily on the specific terms of the original distribution arrangement.
Q: How long does a saisie-contrefaçon procedure take, and what are the cost implications for an importer?
A: A saisie-contrefaçon order can be obtained ex parte within a matter of days. Goods can be seized or documented before the importer has any opportunity to respond. The cost implications for the importer are significant: detained inventory, urgent legal fees, and potential damages claims all arise simultaneously. Importers who lack standing French legal counsel at the time of the seizure will typically spend several weeks organising a response – during which the commercial damage continues to accumulate. Retaining IP counsel in France before beginning parallel import activity is the most effective mitigation.
Q: Does EEA exhaustion apply to digital products and software sold in France?
A: This remains an area of active legal development. French courts, consistent with EU judicial guidance, have held that exhaustion can apply to certain digital products – particularly software distributed through permanent licence grants rather than subscription or rental arrangements. However, the precise boundaries are not settled, and rights holders routinely contest exhaustion claims in digital contexts. Businesses distributing software or digital content across EEA markets through France should obtain specific advice on how current French and EU doctrine applies to their particular licence structure. Engaging a lawyer in France with cross-border IP experience is advisable before any significant digital distribution programme is launched.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. Our intellectual property practice covers trademark application and registration, opposition proceedings, infringement claims, and parallel import management across European and international markets. We combine Portuguese civil law expertise with English common law tradition to advise on IP strategy, rights exhaustion disputes, and cross-border enforcement in both civil and common law systems. Our IP team includes practitioners with experience before French courts, the Institut National de la Propriété Industrielle. Additionally. EU-level proceedings. supporting both rights holders and distributors in navigating the full range of parallel import and exhaustion issues that arise in the French and European markets. As an international law firm in France and across Europe, we work with technology companies, brand owners, institutional investors, and in-house legal teams who require coordinated IP strategy across multiple legal systems. The firm's Lisbon base provides direct access to EU regulatory bodies while our common law expertise supports enforcement and arbitration strategies in English-speaking jurisdictions. To discuss your IP rights exhaustion or parallel import situation in France, contact us at info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.