Exhaustion of intellectual property rights in Singapore
In Singapore, whether an intellectual property right (such as a trademark or patent) can be enforced through an infringement action against the sale of genuine goods marketed in another country then simultaneously imported into Singapore, is governed by an area of law called “exhaustion”.
Singapore’s exhaustion defenses are provided for in the legislation governing patent and trademark law. Both are international in nature. For patents, the general international defense against exhaustion is subject to certain limitations with respect to pharmaceuticals. Where limitations apply, Singapore’s approach to patent exhaustion is national in nature.
For more details on the exhaustion law in Singapore, in relation to patents and trademarks, please read on …
For patents, the Singapore Patent Law, Article 66, contains the legislative provisions defining the defense of exhaustion. General defense is provided for in Article 66 (2); as regards pharmaceutical products, it is subject to the limitations provided for in paragraphs (3) to (5A).
General defense is provided for in Article 66 (2), which states:
“An act which, apart from this paragraph, would constitute an infringement of a patent for invention is not so if -…
… (G) subject to paragraphs (3) and (5A), it consists of the importation, use or disposal, or the offer to dispose of, any patented product or any product obtained by means of a patented process or to which a patented process has been applied, which is produced by or with the consent (conditional or otherwise) of the patent owner or any person authorized by him, and for this purpose “patent” includes a granted patent in any country other than Singapore in respect of the same or substantially the same invention as that for which a patent is granted under this Act and “patented product”, “patented process” and “licensed” shall be interpreted accordingly; “
The defense applies to the transaction and use of an imported patented product or of a product obtained by a patented process. However, the defense does not apply to the use of a process patented in Singapore. The defense applies even if the patent owner in Singapore is different from the patent owner in the country of manufacture, for example because the original owner of the patents in Singapore and in the country of manufacture subsequently sold his patents. rights in the latter patent.
For the purpose of determining whether the product in question was manufactured by or with the consent of the patentee, any conditions imposed by the patentee restricting the resale of the product outside the territory of manufacture / first sale should be disregarded. Contract terms and disclaimers do not override the application of the exhaustion defense in Singapore patent law.
Pursuant to Section 66 (3), the general exhaustion defense does not apply (broadly defined) to the importation of pharmaceutical products, in particular those: which have not been previously sold or distributed in Singapore by or with the consent of the patent owner or his licensee; and the importation of which would amount to a breach of contract between the patent owner and an authorized distributor outside Singapore, and of which the importer would be aware.
Pursuant to Section 66 (5A), the defense of general exhaustion does not apply to the importation or sale, or offer for sale, of any relevant health product manufactured for export to a country that is an eligible importing member of the World Trade Organization (i.e. least developed countries).
In addition, a specific defense is also provided in Section 66 (2) (i) for the importation and disposal of a patented pharmaceutical product intended for use by a specific patient in Singapore, under qualifying circumstances.
For trademarks, Singapore’s Trademark Act, Section 29, contains the statutory provisions defining the defense of exhaustion. It is said:
“(1)… a registered mark is not infringed by the use of the mark in connection with products which have been placed on the market, whether in Singapore or outside Singapore, under that mark by the holder of the registered trademark or with its express or implied consent (conditional or not).
(2) Subsection (1) does not apply where –
(a) the condition of the goods has been altered or altered after they have been placed on the market; and
(b) the use of the registered mark in relation to such goods has resulted in an unfair dilution of the distinctive character of the registered mark.
In Samsonite IP Holdings Sarl v An Sheng Trading Pte Ltd  4 SLR 99, the High Court of Singapore held that for the purposes of subsection (1), “placing on the market” has a broader meaning than a mere act of sale; it also refers to such acts when the trademark owner has realized the commercial and economic value of the trademark and is thus deprived of the right to control the further exploitation of the products.