New EU Regulation offers better protec-tion to IPR holders against the importa-tion of infringing goods into EU territory

by Béatrice Martinet Farano

Right holders will certainly welcome the adoption, on 1 January 2014, of a new Regulation 608/2013 (repealing former Regulation 1383/2003) improving their position with respect to the importation of infringing goods into EU territory by strengthening and streamlining customs procedures relating to the enforcement of IP rights at the borders.

The main provisions included in this new Regulation provide as follows:

(1) The simplified procedure –which allows customs to destroy imported goods suspected of infringing IP rights upon a mere agreement between the IP right holder and the owner of the detained goods without the need to initiate legal proceedings to establish whether an IP right was actually infringed– is now compulsory in all Member States. In addition, the new Regulation makes clear that a lack of answer from the owner of the suspected infringing goods within ten days from the notification of their detention shall be deem to be consent to their destruction. This provision will certainly be welcomed by the right holders of the Member States (about half of them) where this procedure had not been implemented.

(2) Customs authorities now have the option to intervene on a wider range of IP rights, including, in addition to copyright, trademarks (national or community trade marks (“CTM”)), designs (national or community designs (“CD”)), patents and geographical indications that were already covered by Regulation 1383/2003 – trade names (insofar as protected under national law), topographies or semiconductor products, utility models and TPMs (Technological Protection Measures) circumventing devices.

(3) Customs authorities have new powers to destroy small consignments (less than 3 units or two kilograms) of counterfeit and pirated goods without the explicit consent of the right-holder, provided however the right holder has selected this option in his original application and the owner of the goods consent and/or does not oppose such destruction.

(4) Right holders have now greater freedom to use information provided by Customs in relation to suspected infringing goods, including information concerning the nature and quantity of detained goods and the name and address of the owner of the goods. Specifically, the new regulation does not prevent a right holder from using such information to launch proceedings against the owner of goods finally found to be outside the scope of the Regulation (e.g. parallel importation), in connection with criminal investigations or in order to obtain compensation or destruction directly from the owner of the goods.

(5) Right holders will have to provide more specific information to help customs determine whether the imported goods are infringing. Specifically, the new regulation lists a series of information that the right holder will have to provide with its original Application, including specific technical data concerning the authentic goods (bar codes, images, etc.), as well as information relevant to the customs authorities’ analysis and assessment of the risk of infringement (authorized distributors, etc.)

(6) To facilitate the exchange of information between various Customs Authorities of the Member States, a central electronic database will be created by the European commission and be launched no later than January 2015.

It should be noted however that the following categories of good remain outside the scope of the regulation:

(1) parallel imports (goods manufactured with the consent of the right holder but placed on the market for the first time in the EEA without his consent),

(2) overruns (goods manufactured in excess by an authorized manufacturer), and

(3) non-commercial goods carried by passengers in person.

Finally, although the Regulation does not expressly address the situation of goods in transit between two non-EU Countries, right holders will welcome the vote by the EU Parliament on February 25, 2014 of an amendment, included in the review of the CTM Regulation, giving customs the power to stop fakes in transit. Until this resolution comes into force however, the situation of these goods in transit should continue to be regulated by the solution in ECJ Case C-446/09 Philips Electronics) for which the customs authority may retain goods in transit onto the EU only if they have a material suspicion that the goods will be diverted to EU consumers.