Goltsblat BLP lawyers succeed in having the Russian Supreme Court Economic Board adopt a precedential decision on combating parallel imports

22.07.2015

Legal update No 524

Goltsblat BLP advises that the Economic Board of the Russian Supreme Court has adopted a decision that may constitute a precedent in combating parallel imports, especially of hi-tech products.

The Lipetsk Region Arbitration Court satisfied a claim by an unofficial importer seeking to require a medical institution to accept equipment without a manufacturer’s warranty. The courts of appeal and cassation sustained this ruling. Moreover, the courts pointed out that, for product supply purposes, it was sufficient for an importing supplier to provide a warranty for servicing by another party. According to the courts, the manufacturer’s quality warranty made mandatory by the law on public procurement should not constitute an obligation relating to warranty repair and replacement; it should only be a representation about the product’s quality, confirmed by a certificate of conformance issued by the authorised body in the Russian Federation.

Such court practice could offer ample opportunities for semilegal imports of high-tech products circumventing regular distribution channels established by equipment manufacturers.

Goltsblat BLP lawyers successfully challenged these judicial acts in the Economic Board of the Russian Supreme Court. After considering the case, the Economic Board dismissed the acts and the case was referred for reconsideration to the first instance court.

As the Board’s judges specified, the manufacturer’s warranty constitutes an obligation voluntarily accepted by the manufacturer to maintain and repair products supplied. No other warranty may replace the manufacturer’s warranty, which is mandatory by virtue of law for public procurement purposes. As follows from the Court Ruling, “the public contract entered into between the claimant and the Healthcare Department stipulates using budget funds to procure medical equipment needed for providing people of the Lipetsk Region with specialised medical and sanitary care, including hi-tech medical support, in subordinate medical institutions; in consideration of the designated purpose of the equipment, the quality warranty and warranty maintenance should comply with the requirements specified in the tender documentation”.

This judicial act will create a serious obstacle to parallel imports of equipment not supported by a manufacturer and not complying with the relevant quality and safety standards.

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