Concept and Definition of Exhaustion in Law
Exhaustion is a central concept in industrial property protection and intellectual property law. At its core, it describes the circumstance that the exclusive right of the rights holder for further exploitation of a right largely ceases after the first lawful placement on the market of the protected item. Typical areas of application for this legal principle include trademark law, patent law, copyright law, as well as design and utility model law.
Legal Basis and Origins of the Principle of Exhaustion
Historical Development
The development of the exhaustion principle dates back to the jurisprudence and legislation of the 19th century and became particularly necessary in the course of industrialization, when products were traded and distributed on a large scale for the first time. The basic idea is to balance the interests between the holder of an intellectual property right and the free movement of goods.
Statutory Anchoring in Germany and Europe
In Germany, the relevant regulations on exhaustion can be found in particular in:
- Section 17 Copyright Act (UrhG)
- Section 24 Trademark Act (MarkenG)
- Section 9 Patent Act (PatG)
- Section 11 Utility Model Act (GebrMG)
- Section 38 Design Act (DesignG)
At the European level, the exhaustion principle has been harmonized in numerous EU directives and regulations, e.g., Directive 2001/29/EC of the European Parliament concerning copyright in the information society.
Areas of Application of the Principle of Exhaustion
Patent Law
In patent law, the exhaustion principle states that upon the lawful sale of a patented product, the patent holder’s right to further control the subsequent distribution of this specific copy lapses. Further trade, especially resale, leasing, or use, is then permitted without consent. In addition, the principle only applies to the specific product that was put on the market, but not to independently made new items.
National and International Exhaustion in Patent Law
- National Exhaustion: Refers to products that were first sold within the domestic territory.
- Regional exhaustion (e.g., European Union): Products first sold within the EU lead to exhaustion of rights within the Union’s borders.
- International Exhaustion: Is generally not recognized in Germany and the EU; imports from outside the EU without consent are regularly impermissible.
Trademark Law
In trademark law, exhaustion is codified in Section 24 MarkenG. After the first placement on the market of a product with the consent of the trademark owner within the European Economic Area (EEA), further use of the trademark, in particular resale, is permitted. An exception applies only if legitimate reasons exist that oppose further use, for instance in cases of significant alteration or deterioration of the product.
Copyright Law
In copyright law, the exhaustion principle is applied particularly in the distribution of tangible copies of works. With the lawful first sale of a book, sound carrier, or DVD within the EEA by the owner or with their consent, the distribution rights in respect to this concrete copy are exhausted. The online distribution of digital content is not included; exhaustion does not currently apply here.
Design and Utility Model Law
In design and utility model law, exhaustion is also effective after the first lawful sale within the EEA. The owner’s right to prohibit further resale or use is thus no longer enforceable.
Requirements and Exceptions to Exhaustion
Requirements
The following requirements must be fulfilled for exhaustion to apply:
- First actual placement of the product on the market in the EEA or domestic territory
- Consent of the rights holder to the sale
- Placement on the market in the manner relevant for the particular jurisdiction (often limited to physical products; digital downloads are excepted in copyright law)
Exceptions
Exhaustion does not apply when:
- The product was placed on the market outside the EEA without the rights holder’s consent
- The protected item was not properly placed on the market
- Legitimate reasons exist against unconditional further marketing (for example, substantial alteration or deterioration of the product)
- In connection with certain rights, such as the right to adapt a work (copyright), exhaustion generally does not apply
Relationship to Parallel Import and the ‘Grey Market’
Parallel imports are products imported by independent traders from other markets. Here, the exhaustion principle is decisive: products may only be imported from the EEA without the rights holder’s consent. In the case of imports from third countries, further use in the EU is generally prohibited.
A ‘grey market’ refers to the legal trade in original products outside the intended distribution channel. Whether and to what extent the exhaustion principle applies depends on whether the product’s first sale took place within the EEA.
Legal Consequences of Exhaustion
After exhaustion occurs, the owner of the protective right is no longer entitled to claims for injunction, removal, or damages with respect to the further marketing of the specifically sold copy. Resale, use, or leasing now become lawful.
Effects in Legal Practice
Exhaustion substantially contributes to the free movement of goods by preventing excessive control by rights holders and appropriately limiting exploitation rights. Disputes arise especially in connection with grey imports, selective distribution, or when distinguishing whether and to what extent exhaustion has occurred.
Conclusion
The exhaustion principle is a fundamental concept in German and European intellectual property law. It protects the free trade of products and contributes to legal certainty by balancing the tension between the monopoly rights of rights holders and the interest in free movement of goods. The precise determination of the scope and exceptions to exhaustion remains subject to ongoing legal development and jurisprudence.
Frequently Asked Questions
What legal claims do I have as an employee against my employer in the event of exhaustion?
In cases of exhaustion leading to incapacity for work, employees are generally entitled to continued payment of wages in the event of illness pursuant to Section 3 Continuation of Remuneration Act (EFZG). The statutory provision stipulates that an employee who is unable to work due to illness – which includes exhaustion documented by a medical certificate – continues to receive remuneration for up to six weeks. Exhaustion as a medical condition is frequently diagnosed as burnout, exhaustion depression, or adjustment disorder by physicians. If employees require a longer period of absence, statutory health insurance sickness benefits apply after the period of continued remuneration (Section 44 SGB V). Furthermore, the Occupational Health and Safety Act (ArbSchG) obliges employers to take active measures such as workplace adjustments or prevention efforts in cases of proven health risk, including psychological exhaustion. If exhaustion is caused by specific working conditions, e.g., overwork or lack of breaks, employees may request improvements to working conditions via the works council or directly through employment law channels.
What documentation is required by the employer in case of exhaustion?
Employees are obliged to inform the employer of incapacity for work and its expected duration without delay (Section 5 (1) Continuation of Remuneration Act). In cases of exhaustion, a doctor’s certificate of incapacity for work is sufficient. Since January 2023, this certificate is usually transmitted electronically directly to the health insurance fund; the employer obtains the information digitally. The diagnosis (such as exhaustion or burnout) does not need to be specified on the certificate; it merely confirms the incapacity to work. For long-term illness, the employer may request more detailed medical reports (such as those by the Medical Service) if there is justified doubt regarding incapacity. In case of dispute, the exact scope of required proof depends on the circumstances of the individual case.
Does the employer have the right to know the cause of exhaustion or to issue measures?
The employer is not entitled to detailed information on the diagnosis or the exact causes of exhaustion. Medical confidentiality protects this sensitive data. In principle, notifying the employer about incapacity for work is sufficient. However, the employer is obliged to take occupational health and safety measures according to Section 3 ArbSchG, as soon as there are indications of workplace-related exhaustion or overload. Anonymous and aggregated feedback on workplace stress can be incorporated into workplace health protection through the company physician or occupational safety specialist. Direct instructions relating to individual exhaustion, such as transfers or reduced working hours, are only possible with the employee’s consent or if regulated by collective agreement or law.
Is there a statutory entitlement to special protective measures in the case of proven exhaustion?
Yes, according to the Occupational Health and Safety Act (Sections 3, 4 ArbSchG), the employer is obliged to safeguard employee health through suitable measures. In the event of proven health impairment, especially psychological overload/exhaustion, a risk assessment must be carried out, possibly involving the company physician (Section 5 (3) No. 6 ArbSchG). This may result in specific occupational safety measures, such as adapting working hours, providing breaks, ergonomic workplace improvements, or organizational changes. In addition, there is a right to company reintegration management (BEM) under Section 167 (2) SGB IX, if incapacity for work exceeds six weeks within a year or occurs repeatedly.
Can exhaustion be recognized as an occupational disease or industrial accident?
Exhaustion and resulting psychological illnesses (e.g., burnout) are generally not recognized as occupational diseases in Germany. The law on occupational diseases under Section 9 Social Code VII and the Occupational Diseases Ordinance (BKV) do not specifically list psychological exhaustion. Exhaustion as an industrial accident could only be acknowledged if a singular, one-off event led to acute health damage—which is rare with exhaustion. Recognition as an occupational disease is at most conceivable in cases of severe traumatic work events or as a consequence of another recognized occupational disease. Nonetheless, in cases where both temporal and factual causation between workplace stress and illness can be demonstrated, affected individuals may, under certain circumstances, have claims to statutory accident insurance benefits; this must be decided by the respective accident insurance institution on a case-by-case basis.
What are my obligations to cooperate as an employee in the context of company reintegration management (BEM) following exhaustion?
BEM must be offered by the employer under Section 167 (2) SGB IX if an employee is unable to work for more than six weeks continuously or repeatedly within one year—regardless of the cause of illness, including exhaustion. Participation in BEM is voluntary. If the employee declines, no disadvantage should arise as a result. However, if the offer is accepted, certain obligations to cooperate do exist, such as the willingness to participate in discussions to clarify support measures and to provide relevant information for reintegration. Confidentiality and voluntariness of the BEM must be ensured by the employer. Terminating or withdrawing participation does not have any labor law consequences for the employee.
Can absences due to exhaustion lead to labor law consequences?
As a rule, absences due to incapacity for work, substantiated by a medical certificate, do not constitute breaches of employment obligations and therefore cannot result in warnings or dismissals. An exception applies to dismissals for personal reasons in cases of extreme frequency or long-term illness, if there is a negative health prognosis and significant operational impairment. However, before such a dismissal is possible, company reintegration management must always be offered, and the illness-related absence must be significant and prolonged. Individual absences due to exhaustion are, under statutory protection (Dismissal Protection Act, BEM), fundamentally protected from dismissal.
