New Exceptions to Parallel Import Rules in Russia Coming

Russian law generally allows IP rights owners to object to parallel imports of goods into Russia, but very recent (and apparently temporary) changes to Russian law open the door to exceptions to the general rule.

Changes to the Law

On 8 March 2022, a law was passed making changes to various provisions of law, including the rules involving IP rights. Specifically, through 2022, the Russian government may designate certain goods (or groups of goods) for which IP rights can be suspended. These changes to the law are understood to be designed to alleviate shortages of products in Russia associated with international sanctions and embargoes, but the rules are written broadly and may be applied to any or all IP rights connected to the designated goods.

While specific practice has not developed in the application of the rules, there are some important aspects to the new rule. First, it applies to IP rights generally, but is understood to mean that specific aspects of IP rights may be suspended while other aspects remain in place.

Second, the rule is written to apply to goods only. The language of the rule implies that it applies to types of goods and not specifically to goods from a particular producer or jurisdiction, but it is unknown as to how this rule will work in practice.

Third, the Russian government may designate goods only in 2022, but it is not clear as to whether the suspension of IP rights would extend beyond 2022.Fourth, the Russian government may delegate its authority to other federal agencies.

Awkward Delegation and Focus on Parallel Imports

On 29 March 2022, the Russian government issued a resolution delegating some authority under these new rules to the Ministry of Industry and Trade. The Resolution is poorly drafted and results in an awkward delegation of authority.

The Resolution authorizes the Ministry of Industry and Trade to designate goods for which two specific articles of the Civil Code would not apply. While these two specific articles listed in the Resolution are associated with parallel imports, they are not the articles in the Civil Code which provide protection against parallel imports.

Specifically, the articles from the Civil Code listed in the Resolution provide that IP rights protection is exhausted when goods are introduced into the market by or under consent of the IP rights holder. By citing the incorrect articles of the Civil Code, the Resolution does not provide authority for the exemption of IP rights protection from parallel imports but instead exempts the application of the exhaustion of rights. If applied literally, this would mean that the IP rights owners now have stronger rather than weaker protection against parallel imports.

Despite the awkward drafting, it is widely understood that the intention of the Resolution is to allow the Ministry of Industry and Trade to exempt listed goods from prohibitions against parallel imports and we expect the Russian government will clarify this point by amendment or other official clarification to the Resolution.

Practical Result

The practical result is that it appears that the Ministry of Industry and Trade will prepare the first list of goods to be exempted from parallel imports restrictions. No indication has been made as to which goods are likely to be on this first list, but comments from some officials in other contexts have indicated that smart phones and computers as well as vehicle spare parts may be among the first goods to be listed.