Competence to hear IP-related disputes

According to Article 348 of the Civil Procedure Code and Article 4(17) of the Law on Industrial Property (9947/2008), disputes involving patents, trademarks, industrial designs, utility models or any other industrial property right fall under the jurisdiction of the Tirana District Court, Commercial Disputes Division.

Competence of administrative courts
On November 4 2013, in line with Presidential Decree 8349/2013, the administrative courts began exercising their powers and competence under Law 49/2012, which provides that administrative courts are competent to decide on disputes arising from individual administrative acts issued by a public body in the course of its administrative activity. However, an issue arises with respect to IP-related disputes between private entities in which the Albanian Patents and Trademarks Office (ALPTO) is involved as a defendant or a third party.

The Supreme Court rules on disputes regarding the competence of administrative and civil courts. In this regard, on December 6 2013 the Supreme Court held in a unifying and binding decision that the administrative courts are competent to rule on all administrative disputes for which they are competent under Law 49/2012, even if such disputes started before that law came into force, provided that the courts have not yet ruled on the dispute. As a result, the civil courts declared that they were not competent to rule on IP-related disputes involving decisions of the ALPTO Board of Appeal and assigned their case files to the administrative courts.

Supreme Court decisions
However, two Supreme Court decisions on competence to hear industrial property disputes have resulted in further uncertainty.

In FRUCTAL Zivilska Industrija dd v ALPTO (March 31 2014), on the registration of the trademark FRUTAL NICKY FAMILY by Agro Fruit Shpk, the Supreme Court Civil Division held that the Tirana District Court was competent to resolve the dispute. The court based its decision on Article 348 of the Civil Procedure Code and Article 4(17) of the Law on Industrial Property, as well as on Article 8/b of Law 49/2012, which stipulates that “the administrative court does not resolve on disputes, which according to the legislation in force are under the competence of another court”. Given that the subject matter of the disputes was commercial, it should be assessed by the civil court.

Albion Grup shpk v ALPTO (May 6 2014) involved a decision of the ALPTO Board of Appeal to reject Albion Grup's application for the trademark KALTENBEER AT following an opposition filed by Koning International GmbH&Co KG. The Supreme Court Administrative Division decided that the Tirana Administrative Court of First Instance was competent to resolve such dispute. In analysing the nature of the dispute, the Supreme Court held that the dispute was administrative, since it arose from an administrative act issued by a public body (the ALPTO Board of Appeal). According to the court, Article 348 of the Civil Procedure Code was not applicable in this case, since it regulates competence over IP-related disputes only in circumstances where both parties are private entities.

In both cases the claimants requested the annulment of ALPTO Board of Appeal decisions regarding oppositions filed against the registration of a new trademark. Thus, the Supreme Court decisions are inconsistent.

Criteria to consider
In order to provide clarity to rights holders seeking to exercise their rights before the Albanian courts and avoid time-consuming competence disputes, the criteria provided in the Supreme Court’s binding decision of December 10 2013 should be taken into account.

The Supreme Court evaluated three types of dispute:

• If the dispute concerns claims of both a civil and an administrative nature and such claims can be separated without diminishing the value of one over the other, each court (ie, the administrative court and the civil court) should rule on the claims under its competence separately.
• If the dispute involves claims of both a civil and an administrative nature and the resolution of one claim depends on the resolution of the other, the court applies the principle of lex specialis derogate generali  (ie, specific law prevails). The administrative court has competence if:
  • the claim relates to opposition to an administrative act which incurs civil consequences;
  • one of the objects of the claim is of a civil nature, but is closely related to an administrative act; or
  • the claim is not of an administrative nature but depends on the consequences incurred by an administrative act.
• If the object and legal basis of a dispute are of a civil nature and the resolution of the civil dispute requires the court to order an administrative act (eg, the registration or removal of IP rights from the Patents and Trademarks Register), the civil court is competent.

Comment
The fine line between administrative and civil court competence requires thorough analysis by the courts. Taking into account the above case law, disputes involving the exercise of IP rights by their owners (ie, disputes between private entities as per Articles 184 and following of the Law on Industrial Property) should be addressed to the civil courts, whereas disputes arising from an ALPTO Board of Appeal decision (following opposition proceedings before ALPTO) should be addressed to the administrative courts.

Given that the Law on Industrial Property makes no distinction and refers explicitly only to the Tirana District Court, the debate over competence for IP-related disputes is likely to continue until a further amendment of the Law on Industrial Property resolves the issue definitively.