Fri 23rd Nov 2018
Customs watch: Discovery of counterfeit imports (part 2)
When seeking to protect your brand from cheap counterfeits, it is advisable to set up a customs watch but what happens when customs officials discover fake goods?
There is a simple procedure, which involves customs giving 10 working days’ notice to the rights holder and consignor, consignee or carrier of goods, stating their intention to destroy the goods. If there is no objection, consent to the destruction is assumed without the need for a court order. The period is 3 days for perishable goods.
You can arrange for the simplified procedure to apply in certain EU states only, by filing one application for action for certain countries with an opt in to the simplified procedure and a second application for action without opting in to the simplified procedure in other countries.
Court proceedings are only necessary if any party objects to the destruction and if no court proceedings are initiated within 10 days, the goods will be released.
What about small consignments?
Around 22 per cent of matters involve what is known as a small consignment procedure. When setting up an application for action, the rights holder can opt in to a special procedure for dealing with small consignments, namely deliveries of three or less articles that weigh less than two kilograms and are not perishable.
Under this procedure, the owner of the goods must have consented, or failed to object, to destruction within 10 days, after which the goods will be destroyed.
It is important to note that rights holders will be liable to pay the costs for storage and destruction.
If there is no customs watch in place, can customs still take action?
Ex-officio action can occur where customs find potentially suspicious goods. The first step is to ascertain the rights holder and make contact, but customs are unable to disclose information regarding the importer.
The importer of the goods has 10 working days to consent, or object, to the destruction of the goods and the rights holder will be invited to file an application for action.
The application must be filed within four working days and the rights holder has 10 working days to indicate if the goods are counterfeit. Only around two per cent of cases involve ex-officio action, in contrast to over 97 per cent of customs seizures that were preceded by the filing of an application for action. The ex-officio procedure also does not apply to perishable goods.
Why set up an application for action when customs can take ex officio action?
Relying upon customs finding a problem and taking action is all well and good, but they have only one working day to identify the intellectual property rights holders and the rights holder then has four working days only to file an application for action.
You are reliant upon customs ascertaining that goods are counterfeit, whilst a formal customs watch provides greater certainty, and you can provide customs with information as to likely routes and types of counterfeits.
You will have a longer time period to assess the situation. Customs will provide a sample and information on the importer, which could be valuable in your strategy.
Having a watch in place reduces the risk of customs accidentally seizing genuine shipments.
The information obtained from the watch also serves as useful intelligence for dealing with grey imports, as well as counterfeits.
What about parallel imports and grey market goods entering the UK?
The Application for Action procedure does not deal with parallel imports. However, UK customs can deal with infringing goods from outside the EEA, if the goods are:
- not intended for private and domestic use by the importer;
- not already in free circulation in the EEA; and
- they have not already arrived in the UK.
The procedure (s.89 Trade Marks Act) involves notice being given with a small fee paid. The applicant gives an indemnity as to liability and expenses. It can lead to the destruction of goods by customs, if the owner of the goods does not object to the seizure.
How can Page White and Farrer assist?
Page White and Farrer are experts in intellectual property law and can assist in all aspects, including:
- applying for and administering customs watching services;
- advising on and discussing your general intellectual property strategy;
- obtaining national and EU registered rights; and
- sending cease and desist letters.
For more information, contact James Cornish at firstname.lastname@example.org.