The constant rivalry of business entities, aimed at achieving advantages that distinguish them from others, is not always accompanied by honest competitive behavior. This has a negative impact not only on the rights and legally protected interests of other participants in economic relations, but also on consumers, who, after all, realize the goal of any business entity – making a profit.
This was emphasized by the secretary of the judicial chamber for consideration of cases related to the protection of intellectual property rights, as well as related to antimonopoly and competition legislation of the Commercial Court of Cassation as part of the Supreme Court, Volodymyr Selivanenko, during a speech at the VIII Ukrainian Antitrust Forum, organized by the newspaper "Yuridychna praktika".
According to court statistics, the speaker noted, in 2022, 171 procedural appeals in disputes related to the application of antimonopoly and competition legislation were pending in the Commercial Court of Cassation, 106 of them were considered on merits. Based on the results of consideration of the relevant appeals, 30 court decisions were changed or canceled, and 76 were left unchanged. About 16% of the total number of cases in this category were disputes related to protection against unfair competition.
Volodymyr Selivanenko noted that the Civil Code of Ukraine plays a significant role in the regulation of competitive relations, in particular, articles 32–37 of this Code define the concept of unfair competition, specify its types and responsibility for this offense. He reminded that the Verkhovna Rada of Ukraine in the first reading adopted the draft law "On the peculiarities of regulating the entrepreneurial activity of certain types of legal entities and their associations in the transition period", which, among other things, provides for the recognition of the Civil Code of Ukraine as having lost its validity.
"Supporters of such a reform are not fully aware of the consequences of the cancellation of the Civil Code of Ukraine, as well as the risks of legal uncertainty for the economic situation in Ukraine, and also in the conditions of martial law," the secretary of the Chamber of the Supreme Court of the Supreme Court is convinced.
The Speaker believes that the cancellation of the Civil Code of Ukraine will have more negative consequences than positive ones, will not solve problems in the field of economy and will complicate the regular work of lawyers and businesses. "It is better to try to improve the legal act developed over the years by modernizing and bringing it into line with European standards, than to simply end its existence with the negative consequences of such a decodification, which, of course, will affect the extremely shaky investment attractiveness of the country," noted Volodymyr Selivanenko.
Analyzing the judicial practice of protection against unfair competition, the speaker noted that the Supreme Court most often considered cases with the qualification of violations provided for in Articles 4 and 15-1 of the Law of Ukraine "On Protection against Unfair Competition", namely the improper use of marks and dissemination of information that misleads. There have also been isolated cases when AMCU bodies recognized the actions of business entities as violations of the legislation on the protection of economic competition in the form of discrediting and inciting a boycott of the business entity, which are provided for in Articles 8 and 10 of the Law.
As an example of improper use of designations, Volodymyr Selivanenko cited a case in which the LLC appealed to the court with a claim to invalidate the decision of the administrative board of the AMCU branch. This decision recognized that the company had committed a violation in the form of improper use of the sign applied to the exterior facades of pharmacy establishments without the permission of another company, which had previously started using a similar sign for goods and services in its economic activity, which could lead to mixing of their activities. A fine was imposed on the plaintiff for the specified violation.
Court decisions of previous instances are motivated by the fact that primacy in the use of the disputed designation cannot belong to the licensee. The owners of the trademark are citizens of Ukraine – natural persons. The AMCU branch did not provide the court with documentary confirmation of the primacy of the use of the disputed mark by citizens of Ukraine – natural persons. The Supreme Court agreed with the conclusions of the previous courts and noted that the "designation" itself is not an independent object with a status specifically provided for by law, which gives rise to certain rights and obligations, in connection with which it does not have a specific ( special) protection. According to competition law, the designation receives protection in competitive relations, and not as an independent object of intellectual property. The key in this case is the issue of good faith / bad faith in the use of such a designation by business entities.
An example of the dissemination of misleading information can be the case in which the company appealed to the commercial court with a claim to the AMCU for recognition as illegal and annulment of the decision. With this decision, the AMCU recognized that the plaintiff committed a violation in the form of reporting inaccurate information on the labels and counter-labels of the wine of its own production, which can testify and be perceived as information about the foreign origin of these drinks. Based on the results of the case review, the Supreme Court left unchanged the court decisions of the previous instances on the rejection of the claim due to the lack of evidence of the legally defined grounds for their cancellation.
The Supreme Court noted that for the qualification of such actions of economic entities, such as, in particular, unfair competition, it is not mandatory to clarify the occurrence of consequences in the form of, respectively, the prevention, elimination or restriction of competition, infringement of the interests of other entities management (competitors, buyers) or consumers, in particular, due to causing them damage (losses) or other real violation of their rights or interests, or the occurrence of other relevant consequences. It is sufficient to establish the very fact of committing actions defined by law as unfair competition, or the possibility of the occurrence of the specified consequences in connection with the relevant actions of such business entities.
Dissemination of inaccurate, misleading information directly to an undefined circle of persons, in particular as a result of the chosen method of its presentation regarding the name of the product, its consumer properties and the standard to which the product corresponds, which may affect the intentions of these persons to purchase (order) the goods of this sub of the enterprise, incurs the liability provided for in the Law of Ukraine "On Protection from Unfair Competition".
Finally, Volodymyr Selivanenko drew attention to the fact that absolutely all possible violations in the competitive sphere cannot be documented, and the main criterion in this context is the admissibility and appropriateness of evidence as a standard of proof. Each case is individual, and therefore the same evidence may indicate different things in different cases.
Summarizing, the speaker noted that it is extremely important to create confidence in the society that it is possible to receive fair legal protection in court. After all, effective judicial protection of participants in economic relations is one of the most important factors in the formation of Ukraine as a European democratic and legal state, and in the development of market relations.