Under the current legal provisions, importers are required to have authorisation from the rights holders when importing goods into Russia. The RF Civil Code (Article 1487) establishes the principle of the national exhaustion of trademark rights. This means that goods which are imported into Russia by the trademark owner or with his approval are considered legally introduced into civil circulation. Further use of such goods by other entities does not violate the exclusive rights to trademarks. Importation of goods into Russia otherwise violates the rights holder’s exclusive rights to trademarks. Ordinarily, such importation without permission is deemed to be parallel importation.

Recently, following the Russian Prime Minister’s instructions, various ministries, such as the Ministry of Economic Development, the Ministry of Health, the Ministry of Industry and Trade, submitted to the Russian Government their suggestions for allowing parallel importation into Russia of certain products, such as car parts, pharmaceutical devices and pharmaceuticals, without the trademark owners’ authorisation.

The Federal Anti-Monopoly Service (FAS) has also recently provided to the Russian Government its own suggestions to allow parallel importation of cosmetic, perfumery and hygienic products as well as non-alcoholic beverages.

All of the above suggestions, so far, have been addressed to the Russian Government for further consideration and consultations.

Trademark owners with economic interests in Russia might find this development of concern, especially those who have been relying on the national principle of rights exhaustion. Such rights holders who manufacture and import to Russia the products indicated above may discover that they cannot any longer predict their budgeted revenues and losses, or continue relying on relatively stable market share. For them it might also mean a decrease of their Russian market share and a need to revisit and review their pricing policies. Conversely, the Russian authorities are likely hoping to decrease the wholesale and retail prices for the goods suggested for parallel importation for the benefit of local consumers. However, for consumers the danger is that questionable quality goods and even counterfeits may more easily flow into the Russian market.

It is not clear as to when or whether any of these developments will be approved by the Russian Government.