Parallel importation is importation, without the consent of the patent-holder, of a patented product marketed in another country either by the patent-holder or with the patent-holder’s consent. Parallel importation enables promotion of competition for the patented product by allowing importation of equivalent patented products marketed at lower prices in other countries. If the importing country’s patent regime provides that the patent-holder’s right has been “exhausted” (in TRIPS terminology) when the patented product has been placed on the market in another country by or with the consent of the patent-holder, the patent-holder cannot use his/her patent right in the importing country to prevent parallel importation.
Article 6 of the TRIPS Agreement explicitly states that practices relating to parallel importation cannot be challenged under the WTO dispute settlement system, provided that there is no discrimination on the basis of the nationality of the persons involved. It is widely understood to mean that parallel importation is effectively a matter of national discretion.