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The new Customs Enforcement
Regulation (EC) No 608/2013 was
published in the Official Journal of the
European Union on 29 June 2013.
Although it came into force on 19 July
2013, its main provisions will not have
direct effect in Member States until 1
January 2014 from which date the existing
Customs Enforcement Regulation will be
repealed.
The new Regulation will strengthen the
EU's border measures against counterfeit
and pirated goods and make it easier for
such goods to be destroyed following
their seizure. Amongst other things, the
new Regulation:
(a) adopts the previously optional
simplified procedure as the standard
compulsory procedure across all
Member States;
This procedure gives customs
authorities the power to destroy
goods without a court determination
that the goods infringe the relevant
intellectual property rights, provided
the right holder agrees and the holder
or the declarant of the goods agrees
or does not object. Importantly,
customs may deem that the holder or
the declarant of the goods has agreed
to the destruction of the goods where
there has been no opposition to the
proposed destruction within 10
working days of notification.
(b) introduces a new procedure for the
destruction of counterfeit goods in
small consignments;
Right holders will now have an option
of requesting that small postal or
express courier consignments of
counterfeit goods (three units or
fewer, or where the gross weight of
the goods is less than two kilos) be
dealt with by the customs authorities
without the right holder being
contacted in connection with each
consignment. Under this procedure,
the customs authorities will contact
the holder or the declarant of the
goods to notify them that they intend
to destroy the goods. If the holder or
the declarant agrees, or is deemed to
agree to the goods destruction by not
opposing it, then the customs
authorities will destroy the goods
without contacting the right holder. If
there is no such agreement from the
holder or the declarant, then the right
holder will then be contacted and will
have the option to initiate
proceedings.
(c) covers a wider range of intellectual
property rights than the current
Regulation, including unregistered
trade names; and
(d) provides for a new centralised
electronic database (to be set up in
early 2015) through which the various
customs authorities of the EU member
states will exchange information.
The Commission had initially proposed
that the new Regulation should be
extended to parallel imported goods but
these proposals were removed during the
legislative process and the new Regulation
continues to expressly state that it does
not apply to goods "that have been
manufactured with the consent of the
right-holder".
The new Regulation also fails to address
the issues caused by the Court of Justice
of the European Union's 2011 decision in
Philips and Nokia, which decided that
goods entering the EU under a suspensive
customs procedure could not be classified
as counterfeit goods or pirated goods
within the meaning of the current
Customs Enforcement Regulation. This
decision followed on from previous Court
of Justice decisions, including Montex
(2006) and Class International (2005),
which ruled that goods in transit do not
infringe registered trade marks under EU
law unless subjected to a commercial act
directed to the EU, e.g. they were offered
for sale. The result of the Philips and
Nokia decision has been that counterfeit
goods placed under suspensive customs
procedures cannot be detained by the
customs authorities unless there are
indications that the intention is for the
goods to be put on sale in the European
Union. Furthermore, when such goods
are detained, right holders have had to
prove an intention to place the goods on
sale in the European Union if they were
to successfully bring infringement
proceedings in relation to those goods.
The failure to deal with this loophole in
the new Regulation will probably be the
main area of concern for owners of
pharmaceutical trade marks. However, it
is worth noting that in March this year the
Commission adopted proposals for
changes to EU trade mark law (including
significant amendments to the Community
Trade Mark Regulation and a new Trade
Marks Directive) that would close this
loophole. Under the Commission's
proposals, a new category of infringement
provides that counterfeit goods (i.e. goods
covered by a registration that bear an
identical mark) will infringe registered
trade marks in the EU merely by entering
the customs territory of the EU (or, in
the case of national marks, the Member
State concerned) in the context of
commercial activity.
The Commission is currently aiming for
its proposals to be adopted in Spring 2014
with the European Parliament due to
consider them in committee the following
September, before they go before the
Council at the end of that year. Brand
owners in the pharmaceutical industry and
elsewhere will hope that the
Commission's proposed new category of
infringement survives the legislative
process unscathed. However, an
amendment has been proposed before the
Parliament that would require the trade
mark owner to prove that its mark is also
validly registered in the country of
destination.
Derek Rossitter, PTMG Hon. President,
celebrated his 90th birthday in June
2013.
New EU Customs Enforcement Regulation -
Some Improvements for Brand Owners
Robert Guthrie, SJ Berwin LLP, UK