Lisbon Court of Appeal | Penalty Clauses | Competence of Arbitral Tribunals to award Penalty Clauses | 06-06-2019| Case #94
Case nr. 1460/18.9 YRLSB.L1-6
LINK DGSI
Headline:
Arbitral tribunals shall have the power to enforce a penalty payment, particularly in compulsory arbitrations.
Summary:
I – In an arbitration proceeding where the defendants were obliged to refrain from marketing the generic medicinal product, concerning a medicine protected by an SPC held by the applicant during a certain period of time, an appeal on the decision that ordered those defendants to pay a periodic penalty payment will not be devoid of purpose, even if the SPC has already expired in the meanwhile.
II – The arbitral tribunal shall be empowered to apply the periodic penalty payment, provided that all the legal requirements are met.
III – The imposition of a periodic penalty payment requires the existence of facts that may lead to the conclusion that there will be a breach, and therefore if such facts are not proven, this sanction cannot be applied.
IV – In the compulsory arbitration provided for in Arts. 2 and 3 of the Law 62/2011 of December 12th (previous to the Decree Law 110/2018 of December 10th [which approved the current Industrial Property Code]), in view of the profit that both parties derive from the action proposed and of the fact that only one of claimant’s three requests for relief was granted, the applicant and defendants must be ordered to pay the costs in half.
Summary kindly provided by Carolina Roque (carolinaamroque@gmail.com)