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US Supreme Court decides parallel importation does not infringe copyright.

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13 march 1998





A United States Supreme Court decision this week on copyright has reinforced the importance of the Government's proposed copyright reforms.


The United States Supreme Court unanimously decided on 9 March 1998 an American company could not rely on copyright in the label on its shampoo to prevent the importation of that shampoo into the US by another American company, which had purchased a shipment of the shampoo overseas.


What this means is that the USA, like a range of other countries around the world, now permits parallel importation of copyrighted materials in one form or another.


Singapore, Japan, Malaysia, Korea and Canada are all examples of such countries and the European Union permits the free exchange of goods within its borders and with countries in the European Free Trade Area.


What the US decision clearly shows is that Australian consumers are missing out on the benefits of competition in the marketplace through the inappropriate use of copyright law.


The case supports Australia's position that copyright is for the protection of expression of ideas and should not be used to control the importation into Australia and subsequent distribution of non-copyright items such as toys, shoes, liquor, cosmetics, clothing and pharmaceuticals packed in or labelled with material that is protected by copyright.


The right to prevent importation of a pair of shoes, or a piece of fishing tackle, or a bottle of perfume should not be made possible just because it comes in a box or a label that has an artistic work on it.


The US Supreme Court case, Quality King Distributors v L'anza Research International, dealt with goods manufactured in the USA, exported and then imported back into the US without the permission of L'anza, the manufacturer.. Evidence in the L'anza case was that prices charged by L'anza to distributors outside the USA were 35 - 40%, below those charged in the USA and this allowed price competitive imports to be brought in by Quality King.


I see no reason why price benefits would not result from the reforms to be introduced by permitting parallel importation.


The Government's economic studies have consistently shown that permitting parallel

importation of CDs would yield price benefits and a major retailer has predicted price reductions between 25% - 33%.


Australia should not be denied these benefits, enjoyed in one form or another around the world.


We urge the Opposition and the other parties to take note of this case by passing the Governments Copyright Amendment Bills for the benefit of Australian consumers.