Reinforcement of customs action against counterfeiting

Published onMarch 2014

The new French law of 11 March 2014 reinforces the IP rights holder’s means of action against alleged infringers.

In this respect, the customs often play a decisive role, since the customs detentions allow IP rights owners to block the counterfeiting goods, but also to obtain information relating to the counterfeiting networks.

1. Transhipment

Transhipment of goods has been considered as an act of infringement of trademark rights since 2004 (Article L.716-9 of the French Intellectual Property Code) as well as importation, exportation and re-exportation. It is now among the list of acts of all IP rights infringement (copyright, designs, patents, new variety certificates, geographical indications).

However, neither the transhipment is defined by the Code, nor does it constitute a specific customs procedure. The preparatory work for the law showed it aims to cover the transit of goods in France, from and to non-EU countries.

This very issue was examined by the Court of Justice of the European Union (CJEU) (1):

Goods coming from a non-member State which are imitations of goods protected in the European Union by a trade mark right or copies of goods protected in the European Union by copyright, a related right or a design cannot be classified as ‘counterfeit goods’ or ‘pirated goods’ within the meaning of those regulations merely on the basis of the fact that they are brought into the customs territory of the European Union under a suspensive procedure;

Those goods may, on the other hand, infringe the right in question and therefore be classified as ‘counterfeit goods’ or ‘pirated goods’ where it is proven that they are intended to be put on sale in the European Union, such proof being provided, inter alia, where it turns that the goods have been sold to a customer in the European Union or offered for sale or advertised to consumers in the European Union, or where it is apparent from documents or correspondence concerning the goods that their diversion to European Union consumers is envisaged.”

By requesting evidence very difficult to collect and provide in order to bind the customs action, this decision clearly limited the possibilities of intervention of the customs authorities on goods in transit or transhipment. As a result, the French customs had no choice but to stop investigating on goods suspected of infringement in transit or transhipment.

French law No. 2014-315 takes position in favor of controlling and stopping counterfeit goods in transit, and is in line with the text adopted simultaneously by the European Parliament in the framework of the revision of Community trade marks legislation (2).

2. Detention of goods

The new French law aims to improve the provisions concerning customs action against goods suspected of infringing IP rights and the measures to be taken against goods found to have infringed such rights.

Those provisions are common to copyright, designs, patents, new variety certificates, trademarks and geographical indications.

  • The IP right holder (or for geographical indications, the authorized user of the GI or an organization of collective defence thereof), may request to the customs administration to withhold any goods alleged of infringement during customs inspection;
  • The 10-working-day period during which the plaintiff has to institute legal proceedings can be extended for 10 additional working days upon reasoned request;
  • Notwithstanding the professional secrecy to which all officials of the customs administration are bound, the plaintiff may require the customs administration to communicate the names and addresses of the sender, the importer and the consignee of the goods withheld or of the holder thereof, and also the quantity thereof, their origin, where they come from, and now with the new provisions, their final destination and some pictures thereof.

The procedures are not perfectly harmonised.

The plaintiff, to maintain the withholding of the goods, is required within 10 working days, to furnish to the customs authorities evidence either of the withholding measures decided by the civil Court, or that he/she has instituted legal civil or criminal proceedings and has furnished the required securities to cover possible liability in the event the infringement is not subsequently recognised.

But an additional option is offered to the owner of infringed copyright or new variety certificates: the possibility to lodge a complaint with the Attorney General in order to institute proceedings while this option does not exist when design, patent or trademark rights are concerned.

Nevertheless, these discrepancies are only formal, whereas the very same day of the promulgation of the commented law, the French Cour de cassation (Civil Supreme Court) rendered a decision confirming that lodging a complaint with the General Attorney is also a way to institute criminal proceedings (3).

3. Small consignments

Owing to the increasing of importation resulting from Internet sales, specific measures were required and have been inserted into the French law in order to more effectively prevent the entry of counterfeit goods delivered in small consignments.

Goods found to infringe an IP right and sent in small consignments shall be destroyed, upon request of the IP right holder, under control of customs authorities, if the recipient of the goods, within 10 days from the notification, agrees to their destruction or does not reply to the notification.

In this regards, the CJEU confirmed, concerning the destruction of a counterfeit “Rolex” watch bought through a Chinese website and seized by the customs authorities, that “the holder of an intellectual property right over goods sold to a person residing in the territory of a Member State through an online sales website in a non-member country enjoys the protection afforded to that holder by that regulation at the time when those goods enter the territory of that Member State merely by virtue of the acquisition of those goods.” (3)

Those provisions are welcome and should encourage right holders to operate the French or European Union procedures on customs enforcement of their rights.

They should be slightly less well-received by certain consumers…

© INSCRIPTA

(1) CJEU, 01 December 2011, Joined Cases C‑446/09 and C‑495/09, Koninklijke Philips Electronics NV v/ Lucheng Meijing Industrial Company Ltd and a. and Nokia Corporation v/ Her Majesty’s Commissioners of Revenue and Customs.

(2) European Parliament legislative resolution of 25 February 2014 on the proposal for a directive of the European Parliament and of the Council to approximate the laws of the Member States relating to trade marks (recast):

Article 10:

4. The proprietor of a registered trade mark shall also be entitled to prevent the importing into the Union of goods delivered in small consignments as defined by Regulation (EU) No 608/2013 where only the consignor of the goods acts in the course of trade and where such goods, including packaging, bear without authorisation a trade mark which is identical to the trade mark registered in respect of such goods, or which cannot be distinguished in its essential aspects from that trade mark . In cases where such measures are taken, Member States shall ensure that the individual or entity that ordered the goods is informed of the reason for the measures as well as of their legal rights vis-a-vis the consignor.

5. Without prejudice to WTO rules, in particular Article V of the GATT on freedom of transit, the proprietor of a registered trade mark shall also be entitled to prevent all third parties from bringing goods, in the context of commercial activity, into the customs territory of the Member State where the trade mark is registered without being released for free circulation there, where such goods, including packaging, come from third countries and bear without authorization a trade mark which is identical to the trade mark registered in respect of such goods, or which cannot be distinguished in its essential aspects from that trade mark.

The entire text can be read here.

(3) Cour de cassation (Civil Supreme Court), Commercial section, 11 March 2014.

(4) CJEU, 06 February 2014, Case C-98/13, Mr. Blomqvist v/ Rolex.