Jun 2024

Lebanon

Law Over Borders Comparative Guide:

Luxury Law

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1 . Trademark

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1.1. Sources of law

The principal sources of law relating to trademarks are the following:

  • Constitution of March 23, 1926 and its amendments which protects Private Property pursuant to Article 15. 
  • The law on Industrial Property issued by resolution No. 2385/24 of January 17, 1924, currently still applicable to Trademarks and Industrial Designs (Trademark Law). 

In addition, several laws include provisions related to the protection of trademarks namely:

  • Penal Code No. 340 dated March 1, 1943.
  • Consumer Protection Law No. 695 dated February 4, 2005.
  • Customs Law issued by Decree No. 4461 dated December 15, 2000.

As for the International Treaties relating to trademarks, Lebanon has ratified the following treaties:

  • The Madrid Convention for the Repression of False or Deceptive Indications of Source, Decision No. 152/LR of July 19, 1939.
  • The Paris Convention for the Protection of Industrial Property.
  • The Nice Agreement concerning the International Classification of Goods and Services for the purposes of the Registration of Marks. 

The hierarchy of the sources of law is:

  1.  Constitution.
  2.  International treaties.
  3.  Local laws.
  4.  Decrees.
  5.  Decisions.
  6.  Memorandums.

Case law is not considered as source of law. However, the Judicial Authorities may refer to prior case law when dealing with any case. 

Based on the provisions of the Trademark Law, a trademark owner can claim the precedence of use of a trademark even if it is not filed. However, it is imperative in such circumstances to submit written evidence thereof.

Case law supports that registration merely declares a right, not creates it, thus allowing for contrary evidence.

Non-registered trademarks are recognized. However, to obtain full protection for a trademark, the owner must register it. It is worth noting that the owner of an unregistered trademark cannot seek criminal proceedings to enforce their rights. 

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1.2. Substantive law

Lebanese law does not distinguish between famous, well-known and trademarks with a reputation. However, since Lebanon is a member of the Paris Convention, Article 6bis of the Paris Convention applies, providing enhanced protection for well-known trademarks beyond their registered classes. 

There are no special rules governing trademarks in the luxury industry, apart from the specific protection afforded to well-known trademarks. Nevertheless, the “aura of luxury” that surrounds them may serve as ample proof of their well-known status for the application of Article 6bis of the Paris Convention. 

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1.3. Enforcement

Lebanese law does not provide specific criteria for establishing the well-known status of a trademark for broader protection. However, case law indicates several conditions for a trademark to be considered well-known, namely: 

  • Continuous and consistent use over time.
  • Recognition among a substantial population.
  • Distinguished presence and extensive geographical reach
  • Scale and duration of advertising campaigns. 
  • Prior successful trademark registrations. 
  • Legal precedents establishing the well-known status of the trademark.
  • Monetary value of the trademark. 
  • Facts and figures related to the business turnover.

Oral testimony and affidavit may not be sufficient to prove the well-known status of a trademark. 

A trademark can be enforced against a domain name, trade name, its use as a metatag, any other distinctive signs and against its unauthorized use in social media provided that such use is not authorized by the trademark owner, or could lead to confusion in the consumers’ mind or be considered as unfair competition or parasitism. 

The Lebanese law on Advertising (Decree No. 3380 dated 05/05/2016) forbids comparative advertising and the use of a trademark belonging to others in advertisement. Moreover, unauthorized use of a trademark in comparative advertising constitutes trademark infringement and can be enforced under trademark law. 

Trademark law condemns any unauthorized use of a trademark without differentiation if such use is related to parody. However, the courts may consider freedom of speech and expression as grounds for unauthorized use of a trademark in parody provided that such use does not cause any damage to the trademark or its owner. 

It is possible for a trademark owner to take a single action claiming both trademark infringement and unfair competition for the same set of facts. Indeed, a trademark infringement is a form of unfair competition. 

The current issue that luxury brands face in expanding and protecting their trademark rights is the wide spread of counterfeit luxury products in the market and e-commerce. To fight the presence of counterfeit luxury products luxury brands should adopt a customized anti-counterfeit strategy that adheres to Lebanese legal frameworks, addressing both offline and online sales channels. 

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2 . Copyright

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2.1. Sources of law

The principal sources of law relating to copyright are the following:

  • Constitution of March 23, 1926, and its amendments. 
  • Protection of Literary and Artistic Property Law No. 75 of 1999 issued on April 13, 1999 (Copyright Law). 

In addition, several laws include provisions related to the protection of copyright namely:

  • Penal Code. 
  • Customs Law.

Lebanon has ratified the following international treaties relating to copyright:

  • Berne Convention relating to the Protection of Literary and Artistic Property. 
  • Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations.
  • WIPO Copyright Treaty.
  • WIPO Performances and Phonograms Treaty.

The applicable sources are hierarchically structured as follows:

  1.  Constitution.
  2.  International treaties.
  3.  Local laws.
  4.  Decrees.
  5.  Decisions.
  6.  Memorandums.

Case law is not considered as source of law. However, the Judicial Authorities may refer to prior case law when dealing with any case. 

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2.2. Substantive law

Article 2 of the Copyright law states that all creations of the human mind, whether written, visual, sculptural, or oral, regardless of their value, importance, or purpose, and whatever the method or form of their expression, are covered by the protection of copyright. 

This Article includes a non-exhaustive list of works that are protected under the Copyright Law, including but not limited to:

  • Books, publications, and other literary and artistic writings.
  • Oral works such as lectures and speeches.
  • Audiovisual works, photographs, and musical compositions.
  • Dramatic, choreographic, and pantomime works.
  • Various visual arts like drawings, sculpture, and engravings.
  • Computer programs, maps, and sketches.
  • Plastic artworks for industrial or non-industrial purposes.

Objects and/or work of industrial, fashion or accessory design are eligible for copyright protection if they are the creation of the human spirit, and they are original. It is very common for industrial, fashion or accessory design to be protected under copyright law. 

The Copyright Law provides both economic rights and moral rights. Moral rights are perpetual, non-transferable, irrevocable, and intangible as well as attached to the personality of the author. 

Moral rights grant the authors the following rights: 

  • Right of disclosure: the exclusive right to disclose the work and to determine the way and method of such disclosure. 
  • Right of paternity: the right to claim authorship of the work and to have the author’s name mentioned on every copy of the work each time the work is used in public.
  • Right of withdrawal and reconsideration: the right to modify or withdraw the work after initial disclosure. 
  • Right of integrity: the right to object to any distortion, mutilation or modification of the work which would be prejudicial to the author’s honor, reputation, fame or artistic, literary or scientific position. 
  • Right to use a pseudonym or remain anonymous.
  • Right to rescind contracts for the assignment of economic rights even after their publication if rescission is necessary to safeguard the author’s person and reputation or is due to a change in beliefs or circumstances, provided that third parties are compensated for damage resulting from such rescission.

As for the economic rights, they give to the author the exclusive right to exploit the work commercially and to communicate it to the public.

Under the Copyright Law, when natural persons create work under an employment agreement, while performing their duties or professional obligations the employer typically holds the copyright, unless otherwise agreed. Hence, works by employees, consultants, shareholders, and directors for a legal entity are owned by the entity. It is strongly recommended, however, to incorporate an assignment of rights or a “work for hire” clause within the employment agreements or any pertinent contracts between the aforementioned individuals and the legal entity.

The legal entity usually enters into an Independent Contracting Agreement or Service Agreement with the supplier. Such agreement should define the ownership of any copyright created by the supplier while rendering the service. In the absence of such clause, the ownership of the copyright will vest to the supplier. 

Pursuant to Article 17 of Copyright Law, all agreements for the exploitation or transfer of economic rights, whatever their purpose, must be made in writing, failing which the agreement is null and void. It must set out in detail the rights covered by the contract and indicate the time and place. The agreement must also stipulate that the author should receive a percentage of the exploitation revenues. If the agreement is not limited in time, it is deemed to be valid for a period of 10 years from the date of signature.

Moral rights are inalienable. Therefore, authors cannot transfer or waive their moral rights. 

Copyright protection of an individual work lasts for 50 years after the death of the author as from the end of the year in which the death occurred. 

In case of joint works, the term of protection is 50 years after the death of the last co-author. 

For collective or audio-visual works, the term of protection expires 50 years after the year in which the work has been made available to the public or from the creation of the work.

In the event of anonymous or pseudonymous work, the term of protection is 50 years after the work has been lawfully made available to the public. 

In the case of posthumous works or works published in the name of a legal entity, the term of protection is 50 years from the end of the year in which the work was published. 

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2.3. Enforcement

Registration is not required to enforce a copyright. Article 5 of the copyright law stipulates that the author of any artistic or literary work shall, as a result of the creation of the work, have an absolute property right over that work and shall reserve all rights without having to follow any formalities.

A copyright deposit is not mandatory, but it is recommended to serve as presumption of ownership of a work. 

Copyright notice is not required. 

Industrial designs are capable of protection by copyright. In addition, dual protection is possible according to the Lebanese legislations. To acquire copyright protection, an industrial design shall be created by one or several natural persons and must be original, creative and innovative. 

Copyright infringement hinges on overall similarity rather than differences between works. Substantial similarity suffices for a case, yet the Judge wields discretionary power in assessment. 

The copyright owner enjoys an exclusive right that is enforceable against trademarks, registered designs, patents, domain names, trade names, pseudonyms or other distinctive signs, and against any use in social media or in comparative advertising, whenever the reproduced features of the work correspond to the acts deemed as copyright infringement.

Copyright Law does not provide any exception to copyright protection in relation to parody. However, it can be considered as fair use or freedom of speech provided that it does not have any commercial purpose. 

The alleged infringer can claim fair use as a defence. Chapter 6 of the Copyright Law provides that the exceptions classified as fair use include:

  • Personal use of legally published works.
  • Educational institutions lending limited copies.
  • Fair use for criticism, citation, and education.
  • Limited copying for educational purposes.
  • Libraries replacing lost or damaged copies.
  • Copying for judicial/administrative use.
  • Media use of short excerpts with attribution.
  • Display during ceremonies or educational events.

Valid copyright can be deemed unenforceable in case of prescription. This period is determined by 10 years for the civil action and three years for the criminal action. 

The current issues that luxury brands face in expanding and protecting their rights in copyright is the lack of proof of ownership for unregistered copyright and the lack of originality. 

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3 . Design

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3.1. Sources of law

The principal sources of law relating to industrial designs are the following:

  • Constitution of March 23, 1926, and its amendments.
  • The law on Industrial Property issued by resolution No. 2385/24 of January 17, 1924 (Industrial Design Law). 

In addition, several laws include provisions related to the protection of industrial designs namely:

  • Penal Code. 
  • Customs Law. 

As for the international treaties relating to industrial designs, Lebanon has ratified the Paris Convention for the Protection of Industrial Property.

Case law is not considered as a source of law. However, the Judicial Authorities may refer to prior case law when dealing with any case. 

The hierarchy of the principal sources of law is:

  1.  Constitution.
  2.  International treaties.
  3.  Local laws.
  4.  Decrees.
  5.  Decisions.
  6.  Memorandums.

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3.2. Substantive law

The law does not explicitly define industrial designs, yet it is understood to refer to patterns, configurations of lines or colors, and shapes utilized in industrial or craft trades, whether manually or mechanically, such as textile designs. Notably, registration is necessary for protection under industrial design laws, while unregistered designs can still be safeguarded under the Copyright Law.

Under Article 49 of the Industrial Design Law, protection is granted to designs that exhibit novelty and distinctiveness through external elements, imparting a unique appearance that sets them apart from other designs. 

Industrial Design Law does not expressly address designs produced by employees, consultants, shareholders, and/or directors. However, it is likely that the courts may apply Copyright Law provisions concerning individuals creating works under a contract for a person or entity, as part of their duties or professional obligations. Furthermore, agreements between these parties and the entity should incorporate a work for hire clause and a precise assignment of rights to prevent any ambiguity.

The legal entity usually enters into an Independent Contracting Agreement or Service Agreement with the supplier. Such agreement should define the ownership of any industrial design created by the supplier while rendering the service. In the absence of such clause, the ownership of the industrial design will vest to the supplier. 

All agreements regarding designs are only valid if concluded in writing. Industrial design assignment agreements may only be enforced against third parties from the date of their recordal at the IP Office. 

Recordal of the assignment shall be carried out at the assignee’s request within three months of the date of signature of the agreement. A delay fine will be imposed for each two months delay in recording the assignment.

Design Assignment Agreements signed with employees, consultants, shareholders, directors and suppliers should be made in writing and should include the right to register the industrial design in the name of the legal entity. 

The law does not grant moral rights to the creator of an industrial design. However, the creator may be entitled to have their name mentioned as creator in the application for registration at the IP Office. 

The registration of an industrial design is valid for 25 years renewable for a similar period. 

Unregistered designs acquire copyright protection and the term of protection of a copyright shall apply in such case. 

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3.3. New technologies

NFTs have notably influenced the safeguarding of luxury brand rights, both through product authentication and the necessity for luxury brands to register their trademarks in further international classes to secure brand protection in the metaverse.

The use of AI is still at an early stage in Lebanon. The Lebanese legislator has not yet revised current laws to address any challenge related to artificial intelligence. 

There have been no developments in the law in the use of cryptocurrencies as the Central Bank and the Capital Market Authority forbid licenced financial institutions from issuing or marketing of cryptocurrency. 

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3.4. Enforcement

The design infringement is assessed based on overall similarity and not the difference between both designs. Substantial similarity is sufficient to establish infringement. However, the Judge has a discretionary right to assess the copyright infringement. 

Unregistered designs are protected based on copyright protection which also applies the same assessment criteria. 

An industrial design can be enforced against any type of infringement, whether infringement resulting from the unauthorized use of the design in a trademark, a registered design/design patent, patent, domain, trade name and any other IP right and against any use in social media.

Comparative advertisements are prohibited in Lebanon. 

The Law does not provide any exception to industrial protection in relation to parody. However, it can be considered a fair use or freedom of speech provided that it does not have any commercial purpose. 

As a defence, the alleged infringer may challenge the eligibility for protection of the industrial design by invoking ownership of the industrial design, prior art or lack of originality and distinctiveness. 

There is no “repair clause” and there are no similar limitations. 

Registered industrial design can be deemed unenforceable in case of prescription. This period is determined by 10 years for the civil action and three years for the criminal action. 

A designer holder is eligible to act against any infringement of their design for the same set of facts and in the same legal action based on industrial design infringement, copyright infringement, trademark infringement and unfair competition. 

The current issues that luxury brands face in expanding and protecting their design rights is the lack of registration of their industrial designs. In addition, the lack of originality and distinctiveness can be a hindrance for enforcing their rights. 

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4 . Right of privacy, publicity and personal endorsement

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4.1. Sources of law

The law acknowledges an individual’s authority over the commercial utilization of their name, image, likeness, or other distinct elements of their identity. Although not governed by a specific legislation, these rights are supported by various legal frameworks. The Lebanese Constitution primarily guarantees the protection of privacy and image rights. Furthermore, these rights may be upheld under the Universal Declaration of Human Rights and the International Covenant on Civil and Political Rights. 

Regarding personal data protection, Law No. 81, dated 10/10/2018, pertains to electronic transactions and data security. Inspired by the GDPR, it bestows upon the data subject various rights: information, access, objection, erasure and blocking, rectification, complaint filing, damages, and data portability. Additionally, the law mandates obtaining a permit from the Ministry of Economy and Trade, accompanied by a receipt, for collecting and processing personal data. These requisites may pose added compliance burdens and financial risks for luxury brands, although the law remains only partially enforced. 

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4.2. Substantive law

There are no specific conditions for an individual to satisfy in order to own a right of publicity, any living human being shall own this right. 

The legislation does not explicitly grant heirs the right to defend against the unauthorized use of the name or likeness of their deceased relative. Nevertheless, provisions within the Penal Code enable these individuals to pursue legal recourse in cases where their inheritors were subject to defamation or slander. Therefore, and particularly due to the high regard for familial bonds within the society, heirs retain the right to safeguard the reputation and integrity of their departed family members should their name or image are utilized without authorization.

The publicity right is a right related to the individual character of a person. Therefore, the assignment of such right is not possible.

It is possible for an individual to license the commercial use of their right of publicity, such license might be concluded on exclusive or non-exclusive basis. 

The Lebanese laws do not stipulate the requirements the assignment/license of the right of publicity must meet to be valid. Therefore, general conditions for the agreements shall apply for such agreements. 

The licensor retains the authority to revoke the consent for their right of publicity if the licensee violates the terms of the agreement, and such usage adversely affects the licensor’s image and reputation. Furthermore, the licensor can withdraw consent to protect their person and reputation, or due to a change in beliefs, provided that the licensee receives compensation for resulting damages.

The future of the agreement after the death of the licensor will depend on the terms of the agreement. Nevertheless, such agreements usually include a clause that it will remain binding to the heirs until the expiry of its term.

As mentioned above, assignment of name and likeness is not possible. 

If heirs possess autonomous rights to the deceased individual’s name, image, likeness, or other distinct elements of their identity, they are bound by the license agreement until its termination. The licensee must honor the stipulated royalty payments to the heirs. 

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4.3. Enforcement

The right of publicity can be enforced against commercial and non-commercial use of that individual’s name, image, likeness, or other unequivocal aspects of their identity. 

Any unauthorized use of an individual’s name, image, likeness, or other unequivocal aspects of one’s identity can be enforced disregarding its commercial value. However, the commercial value could affect the amount of the damages awarded to this person for the unauthorized use.

The alleged infringer may raise freedom of speech, non-commercial use, criticism and public events as defences.

Celebrities, as public figures, possess restricted control over the use of their names and likenesses for non-commercial purposes. This extends to their depiction in the media, by fans, and on social platforms. This widespread exposure may engender conflicts with luxury brands regarding endorsement agreements. 

Luxury brands should continuously enhance their anti-counterfeiting strategies and techniques by incorporating cutting-edge technologies, including blockchain. This proactive approach is necessary to address the evolving challenges brought about by globalization, technological advancements, and the proliferation of high-quality counterfeit products, along with emerging forms of infringement.

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5 . Product placement

Product placement is permitted in Lebanon. The inclusion of, or reference to, a product, a service or a trademark in a programme is acceptable. Nevertheless, product placement shall comply with the general rules and principles of TV broadcasting and advertising, Advertising Law and Consumer Protection Law. 

Product placement is restricted for items or services disallowed by Lebanese laws, encompassing tobacco, gambling, sexual products, and more. Moreover, product placement must adhere to regulations barring deceptive and/or comparative advertising, and other constraints.

The brand owner can stop the communication in the event the other party fails to perform the agreement and claim damages resulting from the breach. 

Luxury brands should be selective in the choice of the programme in which the product placement shall be made to protect its brand image and reputation. The product placement should always align with the brands value. 

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6 . Protection of corporate image and reputation

Legal entities/corporations are entitled to protect their image and reputation. 

There are no conditions stipulated in Lebanese law for a legal entity/corporation to satisfy in order to enjoy the right of publicity/privacy. 

Legislation or litigation challenges regarding environmental issues or issues of diversity and inclusion are still minimal in Lebanon. 

Law No. 220 of 29/05/2000 regulates the rights of people with disabilities. However, since the law was promulgated in 2000, it does not cover the right of accessibility to websites. 

It is a common practice to include clauses in agreements aimed at protecting the corporate image/reputation of one of the parties provided that it does not contradict with the provisions of the Competition Law.

Luxury brands commonly employ selective distribution channels to preserve brand image and combat the infiltration of counterfeit goods. However, the new competition law grants all Lebanese individuals and entities the right to import products with exclusive representation in Lebanon, for both personal and commercial purposes.

The competition law expressly prohibits price fixing, service fees, and restrictive sale or purchase conditions. Prohibitions also extend to clauses limiting the procurement of authentic, yet non-original spare parts and components.

In cases of contractual breach, liquidated damages are permissible under Lebanese law, predetermined within the agreement. However, courts retain the discretion to adjust these damages to align with the actual losses resulting from the violation.

In the secondary market, the primary concern for luxury brands lies in ensuring the authenticity of their products and preventing consumer fraud, where buyers may unknowingly purchase counterfeit products rather than genuine second-hand products. Regarding repair and reconditioning services, luxury brands have started offering these services directly to their customers as a proactive measure to safeguard their products and brand reputation from potential damage caused by unprofessional workshops.

EXPERT ANALYSIS

Chapters

Australia

Belinda Breakspear
Harriet Young

China

Lina Li
Yunze Lian

Germany

Dr Wiebke Baars

India

Dhruv Anand
Nimrat Singh
Sampurnaa Sanyal
Udita Patro
Pravin Anand

Italy

Fabrizio Jacobacci

Japan

Masaki Mikami

Mexico

Ricardo R. Díaz Cisneros

Netherlands

Herwin Roerdink
Tjeerd Overdijk

South Korea

Clare Ryeojin Park
Dae Hyun Seo
Won Joong Kim

Spain

Eleonora Carrillo
Ignacio Martínez
Rafael Linage

Sweden

Helena Brännvall
Karin Crafoord
Magnus Henning

Thailand

Adele Marchal
Chanapa Thussanasumrit
Munif Chaipanya
Orranat Suvarnasuddhi
Pawat Varapirom

Ukraine

Dmytro Stefanovych
Ganna Prokhorova
Ilona Boliubash

United Kingdom

Simon Miles

United States

Alan Behr
Tod Melgar

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