Anti-Piracy Regulation and goods in transit
The Court of Justice of the European Union has issued its ruling in Joined Cases C 446/09 Koninklijke Philips Electronics NV v Lucheng Meijing Industrial Company Ltd, Far East Sourcing Ltd, Röhlig Hong Kong Ltd, Röhlig Belgium NV and Nokia Corporation and, C 495/09 Nokia Corporation v Her Majesty’s Commissioners of Revenue and Customs, International Trademark Association intervening.
The cases concern the conditions under which goods, that are imitations or copies of goods protected in the EU by intellectual property rights, and that become subject to EU customs supervision while in transit from one non- member state to another, may be detained by the customs authorities of EU Member States. Specifically, the respective courts sought guidance as to whether such goods can be regarded as ‘counterfeit goods’ under European Union law and be detained on that basis, without being marketed or sold in the EU.
The Court’s ruling states that goods from non-member States placed under a suspensive customs procedure cannot, merely by the fact of being so placed, infringe intellectual property rights applicable in the European Union. However those intellectual property rights may be infringed if,
(a) during this time, or prior to the arrival of the goods in that territory the goods are the subject of a commercial act directed at EU consumers, such as advertising, offer for sale or a sale, or,
(b) a customs authority has established that the goods placed under a suspensive customs procedure are imitations or a copies of the protected goods and there are indications before it that one or more of the operators involved in the manufacture, consignment or distribution of the goods, while not having yet begun to direct the goods towards European Union consumers, are about to do so, or are disguising their commercial intentions. Whilst each case must be examined in light of its own facts and circumstances, the Court provided examples of such indications, including
- the fact that the destination of the goods is not declared despite the requirement for such a declaration,
- the lack of precise or reliable information as to the identity or address of the manufacturer or consignor of the goods,
- a lack of cooperation with the customs authorities
- the discovery of documents or correspondence concerning the goods in question suggesting that there is liable to be a diversion of those goods to European Union consumers.
Therefore, following substantive examination, if it is not proven that the goods are or are intended to be put on sale in the European Union, they cannot be classified as ‘counterfeit goods’ and ‘pirated goods’ and detained accordingly. The goods can of course be seized in accordance with the provisions of the European Union Customs Code, as appropriate, for example where the goods in question pose a risk to health and safety.