The Community Design Right provides important intellectual property protection in respect of designs. There is an exception to this protection for 'spare parts' under what is commonly known as the 'Repair Clause' set out in Article 110 of the Community Design Regulation (EC No. 6/2002). It states that "protection as a Community design shall not exist for a design which constitutes a component part of a complex product used . . . for the purpose of the repair of that complex product so as to restore its original appearance."
For years companies have used this clause to sell their own versions of other companies' original parts, often at a cheaper price. Recently, the Italian car parts manufacturing company, Acacia, which has relied on the Repair Clause exemption to sell its own version of both Audi and Porsche wheel rims without infringing design rights, was challenged in both the German and Italian courts. The cases focused on the fact that Acacia sold replacement wheel rims as 'repair parts' and offered them in different colours to the originals being offered by Audi and Porsche. It was argued that the Repair Clause should not apply to Acacia's wheel rims as they were being purchased as an upgrade or customisation, due to the variety of colours being offered by Acacia.
Following an application for interpretation of the Repair Clause from the German and Italian courts, the European Court of Justice (ECJ) clarified that in order to rely on the Repair Clause, the manufacturer or seller of a component part of a complex product must do the following:
- Ensure that the user is informed, through clear and visible indication on the product itself that the component part incorporates a third party design and that the part is intended exclusively to be used for the purpose of the repair of the complex product so as to restore its original appearance.
- Ensure that the repair part is visually identical to the original.
- Ensure that the users do not intend to use the relevant component parts in a way that does not comply with Article 110 (with a recommendation that is done via contracts).
- Refrain from selling such a component part where they know, or should know in the context, that the part in question will not be used in accordance with Article 110.
The ruling of the ECJ means that the wheel rims being sold by Acacia, must be visually identical to the originals, including the colour. Additionally, Acacia must take precautions that the wheel rims will be used only for repair, rather than customisation or upgrade (for example, a seller must now be wary of selling four new rims to the one customer, as it is unlikely all four are required for repair).
These limitations now apply to all spare parts sold throughout the EU used for repair in a complex product, not just car parts. For instance, any business in Ireland selling repair parts for bikes, lawnmowers, phones, computers, watches and other complex products, must ensure that the parts they sell are visually identical to the original parts. There is also an onus on the seller to ensure the parts sold by them are only to be used for repair purposes. Any company failing to meet these obligations will be unable to rely on the 'Repair Clause' and so risks finding itself liable for design infringement.