EBay should not be liable in most circumstances for trademark infringement on its website, according to a senior legal adviser to the European Court of Justice.
The auction site, however, should be responsible for any infringement on its site from the moment it is notified of any trademark breach.
It should also be liable for the content it transfers to search engines such as Google and Yahoo!.
The "non-binding opinion", by advocate general Niilo Jaeaeskinen, was delivered in a case involving L'Oreal.
The luxury goods maker has accused eBay of damaging its brand by using L'Oreal trademarks as sponsored links to lead users to perfumes and other cosmetics that infringe trademarks. EBay has denied this.
Jaeaeskinen says: "Whilst eBay is generally exempted from liability for information stored by its clients on its website, it still remains liable for the content of data it communicates as an advertiser to a search engine."
Both L'Oreal and eBay said they were content with Jaeaeskinen's opinion.
A L'Oreal spokesman said the opinion goes "in the direction of an efficient fight against the sale of fake brands on the internet", while an eBay spokesman says that it is "encouraged that the ECJ's final judgment will reinforce European consumers' freedom to buy and sell authentic goods online."
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