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Today, a trade mark may signify not only the commercial origin or the quality features of the products bearing it but also a brand image that consumers might wish to be associated with. Some trade mark owners have been investing in the creation and development of a brand image through advertising and other marketing techniques in order to attract consumers to their trademarked products. In order to safeguard the investment by trade mark proprietors, the protection given to trade marks under Article 5 (1) (a) of the Trade Mark Directive (TMD), which used to protect merely the origin and quality guarantee functions under the essential function theory, has been expanded to cover the communication, investment or advertising functions (so-called “modern” functions) through the judgments of the Court of Justice of the European Union (CJEU). This expansion was not met with universal approval and resulted in an ongoing debate that had a direct impact on number of areas within the European trade mark law. On the other hand, there is a long-recognized conflict between the exercise of the exclusive rights associated with trade marks and one of the main principles of the European Union (EU), namely the free movements of goods principle. This principle, which aimed to integrate the economies of member states, requires that traders should be free to move their goods within the European Economic Area (EEA), without any “artificial” obstacles such as the territorial nature of trade marks and their associated exclusive right. The case law of the CJEU resolved this conflict through recognizing the principle of European exhaustion which later was implemented by Article 7 (1) of the TMD. According to this principle, the rights of trademark holders are exhausted in relation to goods which have been put on the market under the trade mark within the EEA by the owners or with their consent. However, there is an exception to this general provision. According to Article 7 (2) of the TMD, the rights of trade mark owners will not be exhausted if the owners have a legitimate reason for opposing the further commercialization of the goods in order to ensure that their trade mark can continue to perform its functions. This thesis examines the expansion of trade mark protection under Article 5 (1) (a) of the TMD and it is impact on the rights given to the trade mark owners under Article 7 (2) of the TMD to oppose the further commercialization of their branded products in the context of parallel importation.