EU Customs Regulation: EU Law Tackles Counterfeit Goods
As of 01 January 2014, a new regulation concerning customs enforcement of intellectual property rights is in force across the European Union (EU).
The new Customs Regulation 608/2013 (the new regulation) repeals the previous Customs Regulation 1383/2003 (the old regulation), and introduces some significant procedural changes to the filing and enforcement of a national or EU Customs Application for Action (AFA). In particular, the new regulation provides customs authorities with extended powers to tackle counterfeit goods and makes it easier for such goods to be destroyed once seized.
What is new?
- Most significantly for rights holders, the new regulation provides for an optional new procedure for small consignments (which are defined as postal or express courier shipments, which contain fewer than three units of counterfeit goods or which have a gross weight of less than two kilograms). Under the new procedure, customs may contact the importers of such consignments and seek their consent to destruction of the goods, without the need for the rights holder to confirm that the goods are counterfeit or to provide consent to destruction in each instance. The procedure has obvious benefits for rights holders, who will (at least in theory) no longer have to deal with multiple small detentions. Having said that, the rights holder will not be provided with any information about the importer, exporter or the quantity of goods destroyed in such cases. Also, it is presently unclear how customs officers will determine whether or not goods are counterfeit or whether, in practice, they will still require the assistance of rights holders to do so.
- The ‘simplified procedure’, which was optional under the old regulation, is now compulsory across all member states under the new regulation. The simplified procedure essentially allows EU customs authorities to destroy counterfeit goods without the need for the rights holder to commence court proceedings (to determine whether the goods infringe an intellectual property right), in a situation where the rights holder agrees to the destruction of the goods and the importer of the goods either agrees or does not object to destruction. It should, however, be noted that a number of the member states which adopted the simplified procedure under the old regulation insisted that explicit consent be received from the importer before the goods were destroyed and it remains to be seen whether, and in which member states, such an approach will continue under the new regulation.
- The new regulation clarifies and modifies the rules relating to use of information provided by the customs authorities to the rights holder about, for instance, the identity of the importer. Certain information may now be used in civil and/or criminal proceedings against importers, including compensation claims.
- The new regulation covers a wider range of intellectual property rights, including rights in relation to trade names and semi-conductor topographies.
- A new centralised electronic database (the anti-Counterfeit and anti-Piracy Information System - COPIS) has been set up by the European Commission to facilitate the exchange of information between the customs authorities of the various member states of the EU. It is understood that the COPIS database will interact with the Enforcement Database administered by the EU Observatory on Infringement of Intellectual Property Rights.
The practical impact of the new regulation Existing AFAs
Any AFA granted prior to 01 January 2014 under the old regulation remains valid until expiry but cannot be renewed. Instead, a new AFA must be submitted under the new regulation prior to expiry. Rights holders should also consider whether it might be helpful to file a new AFA at this stage in any event, in order to take advantage of the new small consignments procedure detailed above.
The new AFA form, which is the same for both national and EU applications, requires detailed and specific information regarding authentic goods, including distinctive features, place of production, authorised importers, suppliers, manufacturers, traders and so on. It is now only necessary to submit one copy of the AFA form for EU applications.
It is important to note that rights holders remain liable for the costs of destroying counterfeit goods under the new regulation.
Parallel imports and goods in transit
In line with the old regulation, parallel imports, overruns and goods carried by passengers in their personal luggage (where for their own personal use) have all been explicitly excluded from the new regulation.
Furthermore, the new regulation does not expressly address the issue of goods in transit (ie, goods shipped from outside the EU through an EU member state, which are apparently destined for a country outside the EU). The position adopted by the Court of Justice of the European Union (CJ) in the Philips and Nokia cases in relation to goods in transit (ie, that such goods cannot be classified as counterfeit goods and seized by the customs authorities, unless there is evidence suggesting that such goods will be diverted from their transit onto the EU market) is likely to remain unchanged in practice.
However, the proposed amendments to the Community Trade Mark Regulation and the new Trade Mark Directive, if adopted, will go some way to addressing the issues relating to goods in transit. D Young & Co has extensive experience of filing customs applications and dealing with the detention of counterfeit goods across the EU. Should you require any assistance in this regard then please contact your usual D Young & Co advisor, or Tamsin Holman or Anna Reid of our Dispute Resolution and Legal department.