## Facts

- Anheuser-Busch, a U.S. brewery, owned Finnish trademarks including “Budweiser,” “Bud,” “Bud Light,” and “Budweiser King of Beers.”
- Budějovický Budvar, a Czech brewery, used designations incorporating “Budweiser” (including “Budweiser Budvar”) in marketing beer in Finland.
- Anheuser-Busch sued in Finland alleging Budvar’s labeling and trade name use infringed its Finnish trademarks.
- The dispute over “Budweiser” began before the TRIPs Agreement became applicable but continued after TRIPs entered into force.
- The Finnish Supreme Court referred questions to the Court of Justice of the European Union concerning the interpretation of TRIPs provisions (especially Articles 2(1), 16(1), 17, and 70) and their relationship to EU trademark rules.

## Issues

1. Whether TRIPs applies to a trademark conflict that arose before TRIPs became applicable but continued afterward under TRIPs Article 70(1).
2. Whether the relevant TRIPs provisions have direct effect in the EU legal order, and whether national courts must interpret domestic trademark law consistently with TRIPs.
3. Whether a trade name can qualify as a “sign” whose use a trademark owner may prevent under TRIPs Article 16(1).
4. Whether, and under what conditions, Member States may permit continued use of a trade name identical or similar to a registered trademark as a “limited exception” under TRIPs Article 17, including where the trade name right predates the trademark.

## Decision

- TRIPs Article 70(1) applies to a conflict between a trademark and another sign where the conflict began before TRIPs applied but continued after that date.
- The TRIPs provisions at issue do not have direct effect in the EU legal order.
- National courts must apply and interpret domestic trademark law, including law implementing Directive 89/104/EEC, in light of TRIPs’ wording and purpose.
- A trade name may constitute a “sign” within the meaning of the first sentence of TRIPs Article 16(1).
- The trademark owner’s exclusive right under TRIPs Article 16(1) is implicated when the third party’s use affects, or is liable to affect, trademark functions, especially indicating origin.
- Member States may recognize limited exceptions under TRIPs Article 17 that allow use of an identical or similar sign as a trade name, provided the use is in accordance with honest practices in industrial or commercial matters.
- Where a trade name right predates the trademark and is used honestly in the course of trade, TRIPs does not require that such use be prohibited at the trademark owner’s request.

## Legal Principles

- TRIPs applies to continuing situations existing after its application date, even if the dispute originated earlier, but it does not impose obligations for acts completed before that date.
- TRIPs trademark provisions generally lack direct effect in EU courts, but they inform the interpretation of EU and national trademark rules where those rules correspond to TRIPs obligations.
- “Sign” in TRIPs Article 16(1) includes trade names, so trade-name use can fall within the scope of trademark exclusion rights.
- Trademark protection under TRIPs is function-based: infringement analysis turns on whether the challenged use affects or is liable to affect trademark functions, particularly origin indication, including through confusion.
- TRIPs Article 17 permits limited, good-faith exceptions that do not unreasonably prejudice the trademark owner’s legitimate interests, including continued honest use of a prior trade name.

## Conclusion

The court clarified that TRIPs governs ongoing trademark conflicts after its application date, lacks direct effect but shapes interpretation of EU-aligned trademark law, treats trade names as protectable “signs” under Article 16(1), and allows Member States to preserve prior, honest trade-name use as a limited exception to later trademark rights under Article 17.


Anheuser-Busch, Inc. v. Budějovický Budvar, národní podnik, Case C-245/02, 2004 E.C.R. I-10989 (C.J.E.U. 2004)