Abstract
A party seeking to protect its rights related to a legally granted patent or a registered trademark naturally has the option to initiate judicial proceedings before the ordinary court to obtain recognition of those rights against anyone who has unlawfully used them. However, although this is the ordinary route, it is not the only one available: rights protection may also be entrusted to an arbitral tribunal by initiating specific proceedings based on an arbitration agreement, either in the form of an arbitration clause included in a contract between the parties or in the form of a separate arbitration agreement (depending on whether the dispute has yet to arise or has already arisen).
Since 2020, WIPO arbitrations have quadrupled
Arbitration proceedings can be a valid alternative tool for resolving disputes related to industrial property rights.
The main aspects that make arbitration particularly appealing for the protection of this category of rights include procedural flexibility, arbitrators’ expertise, proceeding’s speed and confidentiality, as well as arbitral award capability to be potentially enforced worldwide. In fact:
- The parties are free to mutually agree on many aspects of the proceeding, including the seat of arbitration, the applicable law, the subject matter of the arbitration, and the composition of the arbitral tribunal;
- Arbitrators can be selected by the parties based on their specific experience in industrial property matters, ensuring a deep understanding of the technical and legal issues involved;
- Compared to ordinary judicial proceedings, arbitration tends to be faster, reducing the time needed to resolve disputes. This is also due to the limited grounds for appealing arbitral awards;
- Arbitration is generally confidential, protecting sensitive information such as trade secrets and business strategies;
- Arbitral awards are recognized and enforceable in over 170 countries that are signatories to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
These features have increasingly persuaded market participants to submit disputes involving industrial property rights to arbitration. Indeed, since 2020, the number of arbitrations under the WIPO has quadrupled. For example, see the growing trend reflected in the report by the World Intellectual Property Organization (available at: https://www.wipo.int/amc/en/center/caseload.html).
However, access to this dispute resolution method depends on some factors that are especially relevant in the context of industrial property, due to the nature of the interests at stake. Among these is the requirement of arbitrability, whose absence automatically invalidates the arbitration agreement (and also makes the arbitral award unenforceable, according to Article V of the 1958 New York Convention).
What Characterizes Industrial Property Rights?
A defining feature of industrial property rights is that they also affect public interests, particularly the interest in fair competition.
For this reason, Article 24.4 of EU Regulation 1215/2012 (known as Brussels I-bis Regulation) provides that in proceedings concerned with the registration or validity of patents, trademarks, designs, or other similar rights requiring deposit or registration, the courts of the Member State in which the deposit or registration has been applied for, carried out, or is deemed to have been carried out under EU legislation or an international convention, shall have exclusive jurisdiction.
This introduces a limitation concerning the validity or nullity of industrial property titles. Therefore, if a dispute arises over such matters, it is generally considered non-arbitrable and must be resolved with binding effect only by an ordinary court, although arbitrators may still consider such matters incidentally under Article 819 of the Italian Code of Civil Procedure.
Disposable Rights and Public Interests: Arbitrability on the Edge
If arbitrability is the ability of a dispute to be submitted to arbitration, this capacity must be assessed under the national law applicable as determined by the arbitration agreement.
In practice, due to major differences between the legal traditions of various countries, it is possible that the same dispute may be arbitrable under the law of one country but not under the law of another.
In Italy, where the legal system rigorously balances private party interests with public concerns, the prevailing view is that industrial property rights are generally arbitrable, as they are considered disposable rights. Therefore, where the economic aspects of these rights come into play (such as licensing or royalties), the requirements under Article 806 of the Code of Civil Procedure are met.
Are Industrial Property Rights Always Disposable?
However, in practice, distinguishing between economic aspects (arbitrable) of industrial property rights and those related to registration or validity (non-arbitrable) can be complex.
The case Valentino S.p.A. v. Mrinalini, Inc., resolved in arbitration, clearly demonstrates this: In this case, the dispute was initiated by Valentino S.p.A. to obtain, among other things, an order to cancel registrations made by its supplier Mrinalini Inc. in the United States, in violation of its industrial property rights (specifically, copyright over the “Swatch” sample and design rights over “Flowers,” “Cape,” and “Two Flowers”).
In the award issued in March 2023, the sole arbitrator found that the claimant’s request could be addressed through arbitration. The arbitrator determined that the cancellation order requested by Valentino S.p.A. concerning the U.S. registrations would not interfere with U.S. sovereignty, as it was not a matter of the validity or nullity of the registrations themselves, but rather a contractual issue, stemming from the supplier’s violation of the applicable General Terms and Conditions of Purchase agreed between the parties.
Arbitration Clause: Instructions for Use
During contract negotiation, it is important to carefully consider the content of any arbitration clause included in the agreement.
Below are some key tips to keep in mind:
- Carefully assess the clause, as it qualifies as a burdensome clause subject to the requirements of Article 1341, paragraph 2, of the Civil Code;
- Agree with the contractual counterparty on critical elements of the arbitration, such as the seat, applicable law, specific disputes to be submitted to arbitration, and composition of the arbitral tribunal;
- In cases with transnational effects, consider the potential differences in applicable legal norms in the various involved jurisdictions.
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Data di pubblicazione: 24 Luglio 2025
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Joel Persico Brito
Graduated from the Università Cattolica del Sacro Cuore in Milan, trainee lawyer passionate about litigation and arbitration law.