Constitutional Court Decision No. 2024/176 E. and 2025/42 K. – Assessment Regarding Industrial Property Rights and the Option of Net Profit-Based Compensation

An application was filed with the Constitutional Court (the “Court”) by the Ankara 1st Civil Court of Intellectual and Industrial Property Rights, requesting the annulment of the provision in the Industrial Property Code No. 6769 (“IPC”) which allows, as one of the optional methods for calculating compensation in cases of infringement of industrial property rights, “the net profit obtained by the infringer” to be taken as the basis. The applicant claimed that this provision is unconstitutional.

Grounds for the Application

The applicant argued that, with the contested regulation, taking into account the net profit obtained by the infringer of the industrial property right in the calculation of the lost profit leads to the inclusion of income earned through lawful and honest commercial activities within the scope of compensation; and that this should be considered a disproportionate interference with the right to property.

Examination and Assessment by the Court

In its assessment, the Court concluded that a person who, without the trademark owner’s permission, imitates, manufactures, sells, distributes, or uses the trademark in commercial life is obliged to remedy the unlawfulness and compensate for the damage caused by such unlawful act.

Within the scope of the decision, it was emphasized that the damage is not limited to actual loss alone, but may also include the profit the trademark owner was deprived of.

In this context, the Court underlined that the optional remedies stipulated in the IPC are granted to ensure effective protection for the trademark owner in the event of damage, and that these remedies aim to achieve deterrence. The decision further stated that the legislator has the authority to take measures in this regard and may introduce provisions that are not limited solely to actual damages.

The Court further noted that first instance courts, when calculating lost profits, will consider objective elements such as the economic value of the property right, the level of recognition of the trademark, the number and duration of licenses, and the extent of the infringement.

Conclusion

The Court concluded that the provision in question does not impose an excessive burden on the parties, does not disturb the balance of interests, and does not constitute a violation of the right to property. Therefore, the application was ruled inadmissible.