Has Russia legalized intellectual property theft?

While its economy suffered from the bombardment of Western sanctions in early March, Russia decided to modify an article of its civil code.

Thomas Osborne
Thomas Osborne
09 June 2022 Thursday 21:53
14 Reads
Has Russia legalized intellectual property theft?

While its economy suffered from the bombardment of Western sanctions in early March, Russia decided to modify an article of its civil code. The world barely noticed decree number 299, which authorized the use of patented inventions (including those belonging to the fields of medicine and digital technology) coming from "unfriendly countries" without asking the owner's permission or paying any compensation. It is no surprise that the Ukraine, invaded by Russia, is considered an "unfriendly country". The same goes for the United States and the European Union, which are not at war with Russia, but which are hitting its economy and arming the Ukrainians.

The measure taken by Russia is not illegal under international law. Countries can make exceptions to patent rules in case of national emergency, since cumbersome paperwork and tedious price negotiations are likely to cause delays. However, some compensation, however insignificant, is expected. Now, under the new Russian law, patent holders might get nothing at all.

Although it only applies to patents (which protect inventions), the law indirectly provides carte blanche for other types of intellectual property infringement. That's because the courts will offer little protection against opportunists, explains Maria Ostroshenko, an intellectual property lawyer at ALRUD, a Moscow law firm. Ostroshenko says that some Russian judges are now asking why the intellectual property of international companies, including trademarks and copyrights, deserves protection. This is something that has never been questioned before.

Western companies are already noticing the change. In early March, Entertainment One UK, the British arm of a Canadian company, lost its case against a Russian rival who used a fake Peppa Pig, one of his trademark cartoon characters. The case was dismissed, according to Vladimir Biriulin of Gorodissky and Partners, Russia's largest intellectual property firm, because Britain falls into the "non-friends" camp. When Entertainment One sought compensation, a Russian arbitration court ruled that agreeing to such a claim was "an abuse of law" in light of the British sanctions. In May, a higher court rejected the company's appeal.

Isolated from the West and given the favor of national courts, the Russians are beginning to dare to seize foreign intellectual property. In the last two weeks of March alone, more than 50 applications for the registration of Western trademarks such as Coca-Cola and Christian Dior were filed. The following are likely to be the proprietary software and devices that foreign producers have stopped selling in Russia. On May 6, Russia published a 25-page list of products that can be imported without the owner's permission. It includes Apple phones, Nintendo game consoles and parts for Tesla cars, as well as weapons and ammunition.

William Miles of Briffa, a London law firm specializing in intellectual property, reports that all of this means their clients have "zero interest" in introducing new brands or new inventions to Russia. This situation will block innovation, predicts Koen Berden of the European Federation of Pharmaceutical Industries and Associations, whose members include Johnson

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Translation: Juan Gabriel López Guix