Explanation of the concept ‘establishment’ (art. 97(1) Regulation No 207/2009) at a legally distinct second-tier subsidiary

TRADE MARK LAW - PRIVATE INTERNATIONAL LAW

A legally distinct second-tier subsidiary, with its seat in a Member State, of a parent body that has no seat in the European Union is an ‘establishment’, within the meaning of that provision, of that parent body if the subsidiary is a centre of operations which, in the Member State where it is located, has a certain real and stable presence from which commercial activity is pursued, and has the appearance of permanency to the outside world, such as an extension of the parent body.
 

"41. Having regard to those considerations, the answer to the question referred is that Article 97(1) of Regulation No 207/2009 must be interpreted as meaning that a legally distinct second-tier subsidiary, with its seat in a Member State, of a parent body that has no seat in the European Union is an ‘establishment’, within the meaning of that provision, of that parent body if the subsidiary is a centre of operations which, in the Member State where it is located, has a certain real and stable presence from which commercial activity is pursued, and has the appearance of permanency to the outside world, such as an extension of the parent body.

35. That jurisdictional rule is a general principle, which expresses the maxim actor sequitur forum rei, because it makes it easier, in principle, for a defendant to defend himself (see, to that effect, judgments of 13 July 2000, Group Josi, C‑412/98, EU:C:2000:399, paragraph 35, and of 19 February 2002, Besix, C‑256/00, EU:C:2002:99, paragraph 52). Such is the case, as the Advocate General stated in point 82 of his Opinion, where a party is required to defend itself before the courts of a Member State in which it has an establishment and with which it is therefore more closely linked.

36. Furthermore, that interpretation does not undermine the objectives of the legislation on the EU trade mark, set out in paragraph 28 above, as the decisions of the EU trade mark courts with jurisdiction on the basis of Article 97 of Regulation No 207/2009 have effect and cover the entire area of the European Union.

37. It follows from such a broad interpretation that there must be visible signs enabling the existence of an ‘establishment’ within the meaning of Article 97(1) of Regulation No 207/2009 to be easily recognised. As the Advocate General stated in point 52 of his Opinion, the existence of an establishment thus requires a certain real and stable presence, from which commercial activity is pursued, as manifested by the presence of personnel and material equipment. In addition, that establishment must have the appearance of permanency to the outside world, such as the extension of a parent body (see, to that effect, judgments of 22 November 1978, Somafer, 33/78, EU:C:1978:205, paragraph 11; of 18 March 1981, Blanckaert & Willems, 139/80, EU:C:1981:70, paragraph 12; of 9 December 1987, SAR Schotte, 218/86, EU:C:1987:536, paragraph 10; and of 19 July 2012, Mahamdia, C‑154/11, EU:C:2012:491, paragraph 48).

38. In that regard, it is irrelevant whether the establishment on the territory of a Member State of an undertaking whose seat is outside the European Union has legal personality or not (see, to that effect, judgment of 15 December 2011, Voogsgeerd, C‑384/10, EU:C:2011:842, paragraph 54). Third parties must thus be able to rely on the appearance created by an establishment acting as an extension of the parent body (see, to that effect, judgment of 9 December 1987, SAR Schotte, 218/86, EU:C:1987:536, paragraph 15).

39. The fact that an undertaking with its seat in a Member State before the courts of which an action is brought is a second-tier subsidiary of the undertaking whose seat is located outside of the European Union and not a direct subsidiary of that undertaking is also irrelevant, provided that the conditions set out in paragraph 37 above are satisfied.

40. Furthermore, it is, in principle, irrelevant for the purposes of Article 97(1) of Regulation No 207/2009 whether the establishment thereby determined has participated in the alleged infringement. Such a requirement, which is not laid down in Article 97(1) of Regulation No 207/2009, would, in addition, not be reconcilable with the need for a broad interpretation of the concept of ‘establishment’, set out in paragraph 34 above."
 

IPPT20170518, CJEU, Hummel v Nike

C-617/15 - ECLI:EU:C:2017:390