Articles

Records of the Customs’ protection of intellectual property right and case handling procedures
04.20.2020

Recordation of the Customs’ protection of intellectual property right is established under the system of Customs’ protection of intellectual property right in the “Regulations of the People’s Republic of China on the Customs Protection of Intellectual Property”. Whether it is a trademark right, or a patent right or a copyright, the right holder can apply to the General Administration of China Customs for record for his intellectual property rights. The existing system of Customs’ protection of intellectual property right in China is divided into two modes: protection of pre-recorded rights (active protection) and protection upon request (passive protection).

1. Procedure for protection upon request

If an intellectual property right holder identifies that suspected infringing goods are about to be imported and exported, he may submit a request to the customs at the point of entry and exit of the goods for detention of the suspected infringing goods, and shall submit a request form and relevant supporting documents and provide sufficient evidence to prove that the infringing fact is obviously true. The Custom will detain the goods as per the right holder’s application, but the case will handled by the People’s Court.

2. Procedure for protection of pre-recorded rights

If the Customs identifies that any imported and exported goods is suspected of infringing the intellectual property rights recorded with the General Administration of China Customs, it shall suspend the release of the goods and notify the right holder. The Customs shall detain the goods in accordance to the request for detention by the right holder and investigate the case. Protection of pre-recorded rights is what we usually refer to as active protection, which is based on the right owner’s application to the Customs for the record. If you do not submit your own intellectual property information to the General Administration of China Customs for record, the active protection of the Customs cannot be invoked.

According to the procedure for protection of pre-recorded rights, import and export enterprises shall pay attention to the following four key points if they encounter infringement cases:

1. The “Regulations of the People’s Republic of China on the Customs Protection of Intellectual Property” stipulates that if the Customs identifies that import and export goods are suspected of infringing the pre-recorded intellectual property rights, it shall immediately notify the intellectual property right holder in writing.

2.Time limit for application of detention of goods: The right holder shall reply whether to detain the goods within 3 working days after receiving the notification from the Customs. If the right holder decides to apply for a detention the goods, he shall pay a guarantee that does not exceed the value of the goods with the Customs. If the right holder fails to file the application or pay the guarantee within the time limit, the Customs shall not detain the goods.

3.Time for investigation and determination by the Customs: After the Customs detains the suspected infringing goods, the Customs will conduct an investigation within 30 working days. After the investigation, the Customs will make one of the four possible determinations based on the infringement situation: the Customs finds infringement, the Customs cannot find infringement, the Customs does not find infringement, and the parties reach an agreement and the goods will be released. If the Customs make a determination of infringement after investigation, according to Article 25 of the “Regulation of the People’s Republic of China on the Implementation of Customs Administrative Punishment”, the Customs will confiscate all infringing goods and impose a fine of less than 30% of the value of the goods. For the normal goods in infringement cases, the customs will return them to the consignor during the application procedure for detention. In addition, according to the Interim Regulations on Law Enforcement Cooperation between the Ministry of Public Security and the General Administration of China Customs, the Customs will transfer the case involving goods of a value of more than 150,000 yuan to the Ministry of Public Security for investigation and handling.

4.Case handling time: Depending on the amount and difficulty of cases in each Customs area, the Customs may generally take 3 months to 12 months, or even more than a year, to handle the case.

Benny Kong & Tsai

20 Apr 2020

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