Raising the Bar: improvements to Customs seizures for trade mark and copyright owners

Raising the Bar: improvements to Customs seizures for trade mark and copyright owners

Raising the Bar: improvements to Customs seizures for trade mark and copyright owners

The significant intellectual property law reforms contained within the recently enacted Intellectual Property Laws Amendment (Raising the Bar) Act 2011 are largely focused upon Australia’s patent system. However the reforms also contain some good news for trade mark and copyright owners, particularly with respect to the processes for seizures by the Australian Customs Service of imported shipments of infringing goods.

Customs seizures and the current Notice of Objection scheme

The Trade Marks Act 1995 and Copyright Act 1968 contain provisions which obligate Customs to seize imported shipments of goods that are suspected of infringing copyright registrations or registered Australian trade marks, if the relevant copyright or trade mark owner has lodged a “Notice of Objection” with Customs.

Once a suspect shipment is seized by Customs, the trade mark or copyright owner (referred to as ‘the Objector’) has a limited period of time to convince the importer to forfeit the seized goods, or to obtain a Court order (usually as part of infringement proceedings against the importer) requiring Customs to hold the goods. Otherwise the seized goods are returned to the importer.

Improvements made by the Raising the Bar Act

The Raising the Bar Act makes four significant changes to the Customs seizure process, following a period of public consultation in early 2011. These changes are favourable to rights holders. While these changes are discussed below in the context of seizures under the Trade Marks Act 1995, similar amendments have also been made to the seizure process under the Copyright Act 1968.

1. Seized goods must be claimed by the importer, otherwise they are forfeited automatically to Customs.

Issues with the current framework

At present, Customs must release the seized goods to the importer, unless the Objector, within an “action period” of 10 working days (which is extendable by a further 10 working days) either:

  • convinces the importer to voluntarily forfeit the goods; or
  • institutes court proceedings against the importer and within 20 working days of instituting proceedings obtains a court order preventing release of the goods.

However it is often difficult for the Objector to identify and contact the infringing importer within this action period, particularly when the importer purposely obfuscates their contact details or otherwise makes contact difficult in an attempt to frustrate action within the 10 day period.

Changes to the scheme

After the Raising the Bar Act commences, any seized goods will automatically be forfeited unless the importer files a claim with Customs within a designated “claim period”. (Customs can accept late claims in limited circumstances).

The importer’s claim must include sufficient information to identify the importer, including an address for service. The Objector’s action period then only commences after it has received notice from Customs of a claim for return made by the importer, and the importer’s contact details provided on the claim form. This change should result in the forfeiture of far more counterfeit goods.

2. Trade mark owners to be given more information about the importers and exporters of seized shipments

Issues with the current framework

At present, when Customs seizes a shipment of suspect goods, it provides the Objector with a “Notice of Seizure” that identifies:

  • the seized goods;
  • the full name and address of the importer; and
  • optionally, any information that Customs reasonably believes could help identify the importer.

Customs cannot generally provide any other information to the Objector without a court order. Importantly, this includes details of the consignor or supplier of the goods. This can be extremely frustrating to objectors who often want to take action against the source of counterfeit goods.

Changes to the scheme

After commencement of the amendments, Customs will be able to give the Objector additional information about the seized shipment, including:

  • the name and address of persons who arranged importation (i.e. the consignor or supplier of the goods);
  • any other personal information that could help identify the exporter; and
  • any identifying information about the importer contained in any claim form lodged with Customs for release of the seized goods.

This will assist rights holders in identifying the ultimate supplier of counterfeit goods.

3. Greater clarity around method of disposal of forfeited goods

Issues with the current framework

At present, if the importer of a seized shipment opts to forfeit the goods, or if a Court orders the seized shipment to be disposed of as a result of infringement proceedings brought by the Objector, the Trade Marks Act stipulates that Customs must dispose of the goods “as the Customs CEO directs”.

The Act’s wording provides little certainty about whether Customs may give forfeited goods to the Objector for use in related infringement proceedings against the importer, or how the goods are to be disposed of.

Changes to the scheme

Amendments to the Act now clarify that the forfeited goods do not need to be disposed of if they are required for a related infringement action. Furthermore the amended Act will allow for the Trade Marks Regulations to prescribe methods of disposal for forfeited goods.

The amendments also provide that if goods have been automatically forfeited by the importer because they have failed to lodge a claim for return (see 1, above), then Customs must not dispose of the goods for 30 days after expiry of the claim period. During this period the importer can lodge a late claim for the goods, the acceptance of which is at the Customs CEO’s discretion.

4. Objectors will be able to inspect the seized goods

Issues with the current framework

Customs does not have any powers under the Trade Marks Act to permit Objectors to inspect seized goods. This can cause difficulties when the Objector needs to carefully study seized goods in order to determine whether or not they are counterfeit or otherwise infringe its rights.

Although in practice Customs will provide the Objector with photographs of seized goods on request, this does not aid the Objector in circumstances where detailed analysis is required to determine the origin of the seized goods.

Changes to the scheme

Following commencement of the amendments in 2013, Customs will have the power to allow both the Objector and the importer to inspect the seized goods. The Objector and the importer will also be able to remove samples of the goods for further analysis if they provide undertakings to Customs to:

  • return the goods at a designated time; and
  • take reasonable care to prevent damage to the goods.1

This will assist in allowing rights holders to accurately identify counterfeit goods.

Good news for trade mark and copyright owners

These changes to the Customs seizure provisions of the Trade Marks Act and Copyright Act will come into effect from 15 April, 2013 and will strengthen Australia’s anti-counterfeiting efforts. They address many of the practical difficulties faced by trade mark and copyright owners when using the Notice of Objection scheme and will mean greater efficiencies when enforcing IP rights against importers of counterfeit or otherwise infringing goods.

If you would like to discuss how Davies Collison Cave can assist your anti-counterfeiting efforts, please do not hesitate to get in touch.

Endnotes

  1. Although Objectors have the power to remove a single suspect copy under the current Copyright Act seizure provisions, the new changes to both the Copyright Act and Trade Marks Act will allow inspection and removal of multiple copies or articles for analysis. This can be important where a suspect shipment contains a mix of both non-infringing and infringing articles or copies.