The new repair clause in German Design Law

To strengthen fair competition, the German Design Law was amended on 26 November 2020. Similar to EU law, it now contains a repair clause in new § 40a of the German Design Act stating that spare parts shall in certain circumstances be excluded from design protection. The implications remain to be seen – and this will still take a couple of years as the restriction is only applicable to designs applied for on or after 2 December 2020.

                                                                                                                                                    (Source: Shutterstock; 1418006408)

BACKGROUND

Germany is a country known worldwide for its automotive industry and great brands like Mercedes, BMW, Audi, Porsche, Volkswagen and more. The car manufacturers form a big  part of the German economy and try to protect their innovations in any way possible. Thus, there are many design registrations for all parts of cars pending which bar third party manufacturers from providing auto spare parts in the aftermarket for repair purposes. The effect is that consumers have to pay about 30 – 55 % more for design protected spare parts than they would have to pay in a free market. The spare parts aftermarket in Germany is more or less monopolized and it is nearly impossible for third party manufacturers to enter it.

NEW LAW

Despite the strong lobbying of the automotive industry, the German Design Law now includes a new § 40a of the German Design Act. It excludes design protection for component parts of complex products which are used solely with the aim of enabling the repair of the complex product and restoring its original appearance, provided that consumers are informed about the origin of the spare part, so that they can freely choose between competitors.

By referring to the necessity that the spare part must only be used to restore the original appearance of the complex product, the scope of the new provision is mainly to form-dependent, that is must-match parts which equal the original parts of the car in their exact shape and dimensions. In the automotive industry, the most affected spare parts will be car doors, hoods, fenders, mudguards, exterior mirrors, windows, headlights and taillights – basically all visible, body-integrated replacement parts that must be manufactured in a certain way to fit the original appearance of the car.

While typical examples for an application of the new repair clause are such relating to the automotive industry, it will, of course, also have effect in all kinds of other sectors with strong design protection like household appliances, consumer electronics or sanitary equipment.

CRITIQUE

Even though the German government implemented the new repair clause, it also gave in to the strong lobbying of the automotive industry. The new repair clause only applies to those designs which have been filed on or after 2 December 2020. Designs for spare parts already registered before 2 December 2020 can still claim design protection for the rest of their “life”. Thus, the intended full liberalization of the aftermarket for spare parts of cars will only become reality in 25 years, when the last design filed in 2020 for those spare parts expires.

This is, of course, criticized by the aftermarket industry that claims that there should be no design protection for spare parts – visible or not – because there is no design alternative for repairs. Other criticism comes from consumer protection groups which argue that a wider liberalization would only be to the advantage of consumers as prices for spare parts and repairs will go down. It will have to be seen if the clause will be amended again in the next years.

STRATEGIC CONSIDERATIONS

Do not stop filing designs for spare parts! The new § 40a of the Design Act only relates to spare parts used to repair and restore the original appearance of complex products. You will, however, still need registered designs to protect your products in the primary market and to keep copycats from imitating your goods.

In view of the new repair clause, we recommend that you review you design and overall intellectual property filing strategy to see if any amendments are needed. Should you like to discuss this issue and potential implications of the new repair clause for your designs, you are welcome to contact us at LexDellmeier

- by phone: +49 89 55879870 or

- by email: info@lexdellmeier.com

and we will be glad to advise further.