An Introduction To Unfair Competition Law And The Paris Convention

The law of unfair competition can be traced back as far as the 19th century in Europe and as far back as 1791 in France due to the introduction of free trade.

The French were the only Europeans to find a working solution to unfair competition from the beginning with the general tort law clause in Article 1382 of their Civil Code. With this foundation of unfair competition law, case law quickly developed the so called “action en concurrence deloyale”, which guaranteed traders protection against the risk of confusion, imitation, betrayal of their secrets and parasitic competition.

Germany refused to follow the French idea and under pressure to find some solution to unfair practices was forced to adopt a special law on competition by the early 19th century. England took a quite different direction to both France and Germany, in that it did not recognise a tort of unfair competition law like the French or a special law like the Germans. England decided to rely on their already existing available action under equity and common law. One such action on which England heavily relied on was the action against passing off.

Protection against unfair competition outside of the scope of these existing laws was deemed as incompatible with the common law system.

The US took on a slightly modified form of the UK’s solution to unfair competition. This included limited possibilities of civil law claims in the form of Section 43 of the Lanham’s Act.

France pushed for the introduction an unfair competition law with equivalent protection to their own on an international level. This was to secure comparable protection to their own laws for its nationals abroad.

The French dominated the International Association for the Protection of Industrial Property (AIPPI) which was very much involved in the construction of the Paris Convention. They attempted to include a clause in the Paris Convention against unfair competition similar to the wording of their own clause in Article 1382 of the French Civil Code.

This was unsuccessful but at the Brussels Revision Conference of 1900 article 10bis was agreed on which obliged the contracting states to grant nationals of other contracting states the same protection against unfair competition as their own citizens.

Article 10bis of the Paris Convention 1883 is the principle foundation of international law in the field of unfair competition. It was constructed in its current day form at the Hague Conference in 1925. From 1911 to 1925 the UK was a driving force behind the construction of article 10bis.

The strength of Article 10bis of the Paris Convention is its flexibility. It states that “any act of competition contrary to honest practices in industrial or commercial matters constitutes an act of unfair competition”.

It goes on to list a number of activities which it covers as “those which cause confusion, deception or damage to another’s reputation”.

Unfortunately the above statement, even though it covers “any act of competition contrary to honest practices” offers no measure of when a member state has fulfilled the requirements laid down in the Paris convention which makes it inconsistent.

Today, most developed countries recognise laws which guarantee fair play in economic life. But there are significant differences in them.

Most Continental-European countries have an independent unfair competition law while common-law countries like the United Kingdom and the USA are still opposed to such an approach, and apply unfair competition law with great hesitance.

These differences are not good news in a time of rapid internationalisation of trade and competition and therefore more needs to be done than simply relying of article 10bis of the Paris convention.

Unfortunately unfair competition law, unlike copyright and trade mark law, is not easily containable in its specialised form but wide ranging and deeply rooted in most legal systems.

Looking at the diverse range of solutions the European (and international) countries have implemented to protect against unfair competition it can only be said that article 10bis of the Paris Convention has accomplished great feats in the unification of international legal systems during the one hundred years since its inception.

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