The DIFC Law of Passing Off

In my article on the DIFC law of confidence of 27 Jan 2011 I wrote:

"The DIFC (Dubai International Financial Centre) is like a little bit of London in the Gulf. Covering an area of 45 hectares - slightly smaller than Kensington Gardens - it is a free zone for the banking, insurance, trading and other financial services industries with its own legal system. As I said in my article on The DIFC Courts, the interesting attribute of this legal system is that the laws are in English and its courts apply the common law."

The law of confidence is one of two areas of intellectual property law for which there is legislation in the DIFC. The other area is the law of passing off. Both derive from the same source, namely the Law of Obligations.

Art 38 (1) of that law provides:

"A defendant is liable to a claimant if:

(a) the claimant's goods, services or business have acquired a goodwill or reputation in the market and are known by some distinguishing feature;

(b) the defendant makes a misrepresentation which confuses or deceives persons in relation to the goods, services or business of the claimant, or is likely to do so; and

(c) the claimant suffers or is likely to suffer damage as a result of that belief."

Art 40 (1) gives "misrepresentation" the same meaning as in contract law save that a statement made without regard for its truthfulness which is in fact untrue and which induces the representee to enter into a contract, whether or not that was the intention of the representor, shall be a misrepresentation for these purposes. Instances of confusion or deception include the reasonable belief that

(a) the defendant's goods, services or business are the goods, services or business of the claimant, or vice versa;

(b) the claimant's goods or services of one class, quality, condition or state are of another class, quality, condition or state;

(c) the defendant's goods or services belong to a class of goods or services with a discrete reputation, when they do not; and

(d) goods are covered by the claimant's guarantee when they are not so covered.

Art 38 is clearly derived from the Lord Oliver's speech in Reckitt and Colman Products Ltd v Borden Inc and Others [1990] 1 WLR 491, [1990] 1 All ER 873, [1990] UKHL 12, [1990] RPC 341:

"The law of passing off can be summarised in one short general proposition - no man may pass off his goods as those of another. More specifically, it may be expressed in terms of the elements which the plaintiff in such an action has to prove in order to succeed. These are three in number. First, he must establish a goodwill or reputation attached to the goods or services which he supplies in the mind of the purchasing public by association with the identifying "get-up" (whether it consists simply of a brand name or a trade description, or the individual features of labelling or packaging) under which his particular goods or services are offered to the public, such that the get-up is recognised by the public as distinctive specifically of the plaintiff's goods or services. Secondly, he must demonstrate a misrepresentation by the defendant to the public (whether or not intentional) leading or likely to lead the public to believe that goods or services offered by him are the goods or services of the plaintiff. Whether the public is aware of the plaintiff's identity as the manufacturer or supplier of the goods or services is immaterial, as long as they are identified with a particular source which is in fact the plaintiff. For example, if the public is accustomed to rely upon a particular brand name in purchasing goods of a particular description, it matters not at all that there is little or no public awareness of the identity of the proprietor of the brand name. Thirdly, he must demonstrate that he suffers or, in a quia timet action, that he is likely to suffer damage by reason of the erroneous belief engendered by the defendant's misrepresentation that the source of the defendant's goods or services is the same as the source of those offered by the plaintiff."

Art 38 (2) adds that it is not necessary for the purpose of art 38 that the persons confused or deceived should be aware of the claimant's identity, provided that they are accustomed to the claimant's goods, services or business. It is spelt out in art 38 (3) that it is no defence that the defendant did not intend to cause deception or confusion. A defendant is liable under art 39 if he knowingly assists or facilitates passing off by another person.

Qatar Financial Centre

Like Dubai, Qatar has established a financial centre with its own legal system which is called the Qatar Financial Centre ("QFC"). The Centre has its own constitution, primary and secondary legislation and institutions including a Civil and Commercial Court that is distinct and separate from, and independent of, all other Qatari courts.

The QFC Constitution

The CFC is established by Law No. 7 of 2005 ("the QFC Law") which was signed by the Emir of Qatar on 9 March 2005 and came into force on 1 May of that year. Art 2 (1) of the QFC Law provides for a business and financial centre to be located initially in Doha. It is possible under art 2 (3) for businesses located elsewhere in Qatar to be treated as though they were operating in the Centre provided that they undertake to relocate to the Centre. Art 3 (1) provides for the QFC to be governed by a QFC Authority consisting of a Board chaired by the Minister of Economics and Finance of Qatar and up to 9 other members appointed by the Council of Ministers. The Board's duties include laying down general policies and plans for the centre (para 5.1 of Sched 1 to the QFC Law) and proposing legislation to the Minister (para 5.2). Art 8 establishes a regulatory authority, regulatory tribunal and Civil and Commercial Court. The Minister has power under art 9 to enact primary legislation known as "regulations" for the QFC within the scope of Schedule 2 which includes intellectual property (para 10 of Sched 2).

Legislation

So far the Minister has made regulations for arbitration, companies, contracts, data protection, employment, financial services, immigration, partnerships, tax and trusts. Some of those regulations provide for the QFC Authority to make secondary legislation known as "Rules". Art 21 (1) of the Data Protection Regulations 2005. for example, enables the QFC Authority to make rules in respect of any matter relating to the processing of personal data and data controllers. Accordingly, the Authority has made the Data Protection Rules which cover the processing of sensitive data, transfers of data out of the QFC, notification and claims to the Regulatory Authority for relief for alleged breaches of the Data Protection Regulations.

The Civil and Commercial Court

Para 1 of Sched 6 of the QFC Law provides for the Civil and Commercial Court to be governed by a Chairman and a number of other legally qualified members none of whom may be members of the Board. None of those members may sit on the Board, regulatory authority or any other QFC institution. Para 8 of that Schedule provides for the Court to have original and appellate jurisdiction for which purpose it sits in First and Appellate Circuits.

Judiciary

The President of the QFC Civil and Commercial Court is Lord Woolf . the former Master of the Rolls. Other judges include Lord Cullen, Lord Scott, Sir Philip Otton, Sir Peter Gibson and Barbara Dohmann QC. There are also judges form other jurisdictions and academia.

Case Law

Judgments of the Court are published on the QFC website. Particularly interesting is the recent decision of the Court in Re Al Mal Bank LLC, Omara and Another v Al Mal Bank LLC where it considers its jurisdiction to make freezing orders in a company insolvency in the absence of a rule book.

Further Information

Any member of the Bar of Qatar or of any other jurisdiction may appear before the QFC Court. There is already a set of chambers in Qatar though none of its members claims expertise in intellectual property. Should anybody wish to discuss this article further he or she can get in touch through my contact form.