Viro south africa locked in court fight.

October 99 News & Events

Johannesburg - The Pretoria High Court recently granted interim protection to Viro South Africa, the lock manufacturer, interdicting and restraining Viro Italy from marketing, selling or distributing Viro security products in several southern African countries, including South Africa.

Viro South Africa's local market share on padlocks stands at about 65%.

The interdict was a result of Viro South Africa instituting legal proceedings against Viro Italy to enforce its rights in terms of an agreement concluded between the companies in 1997.

In terms of the agreement, Viro South Africa pays Viro Italy a royalty and has the sole right to distribute products bearing the Viro brand in South Africa.

Viro South Africa has been the sole and exclusive distributor of Viro products in South Africa on an uninterrupted basis since 1996.

However, Viro Italy has instructed Viro South Africa to stop using the Viro name and has signalled its intention to enter the local market. The Italian company sent a letter to Viro South Africa's wholesalers and retailers to this effect.

Viro South Africa has also issued a summons for an order confirming the licence agreement between itself and Viro Italy. It directed Viro Italy to comply with its obligations in this regard. This action is still to be heard.

Rina King, the Chief Executive of Viro South Africa, said the company was concerned that Viro Italy planned to flood the local market with low-priced Chinese products and pass them off as the well-known quality local brand.

Her company had been producing Viro padlocks and lock components since 1966 under a royalty agreement with Viro Italy marketing the brand and setting up its reputation for quality, reliability and durability.

Although a new agreement was finalised, King said, Italy was now disputing this. The matter would be the subject of a court case at a date yet to be set.

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