Interception of counterfeits by Customs Authorities: AG Opinion in Philips v Lucheng Meijing  and Nokia v HMRC


The Advocate General ("AG") has given his opinion on two questions referred by the Dutch and UK courts on the ability of European customs authorities to intercept branded goods which are suspected of being counterfeit, but which are ostensibly in transit through Europe to a destination outside the EEA.

The AG confirmed that the "production fiction" could not be applied when considering the "old" Counterfeit Goods Regulation, and recommended that customs authorities may only seize goods in transit where there are sufficient grounds for suspecting that the goods are counterfeit and are to be put on the market in the EC.

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In Koninklijke Philips Electronics NV v Lucheng Meijing Industrial Company Ltd and others the Advocate General considered the "old" Counterfeit Goods Regulation (3295/94/EC) and, in particular, whether the so called "production fiction" must be applied such that it is assumed that the goods to be intercepted were manufactured in the member state within which the goods are seized. This is a test commonly used in the Netherlands to enable customs authorities to seize allegedly counterfeit goods, even where they appear to be in transit to a destination outside Europe.

The AG held that the production fiction could not be applied.

In Nokia Corporation v HMRC the ECJ was asked to consider whether goods in transit in a member state from one non-Community country to another were capable of being "counterfeit goods" within the meaning of Article 2(1)(a) of the "new" Regulation (1383/2003/EC), if there was no evidence to suggest that those goods were to be put on the market in the EC.

The AG found that there must be sufficient grounds for suspecting that they are counterfeit and are to be put on the market in the EC. Customs authorities must have the "beginnings of proof", described as being some evidence that the goods might infringe an intellectual property right. Unfortunately for rights owners, the parameters of what amounts to sufficient grounds for suspicion were not set out in the AG's opinion, and are yet to be applied in practice. The AG did, however, set out some circumstances that can lend substance to a well-founded suspicion that goods were to be placed on the market of the EU, which included excessive duration of transit; the difficulty in identifying the consignor of the goods; and the kind and number of means of transport used.

For the full text of the opinion, click here.

Case: Koninklijke Philips Electronics NV v Lucheng Meijing Industrial Company Ltd and others, Nokia Corporation v Her Majesty's Commissioners of Revenue and Customs, Joined cases C-446/09 and 495/09, 3 February 2011

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The original publication date for this article was 10/02/2011.