Recording your Intellectual Property with Customs in India
So you’ve filed and registered your trademark, and have been using it consistently. Life goes on as merrily as possible until you realize that there are counterfeit products with your trademark in the market. The first thing you would have to do is conduct an investigation into where the products are coming from. The counterfeit products could be manufactured within India or it could be manufactured outside the country and shipped in.
Recording your Intellectual Property with Customs
While criminal sanctions exist and anti-counterfeiting action can be taken through the police raids once the goods are in the country, what if you could stop them before they got in! The IPR (Imported Goods) Enforcement Rules, 2007 in conjunction with the Customs Act do offer IP holders the rights to register their intellectual property with the customs houses to stop the import of infringing products. While the Rules were drafted based on the model of the WIPO, the Indian rules include protection for Patents, GI’s and Designs while the WIPO model was restricted to Trademarks and Copyrights.
The effect of the IPR Rules, is such that, the registed owners of intellectual property rights have the ability to issue a notice about their goods, and the Customs office, where protection is sought. This may be:
- With knowledge of imminent infringement – Giving information to customs
- Preventive Protection – For a period of one year.
This notice is for an individual customs office. You can record it with on custom house if you find out that that is the only point, or chose as many as you see fit. There are 40 different customs offices in total.
The rights holders have to sign a bond with surety and an indemnity bond with the Commissioner of Customs undertaking to pay the costs of retention/destruction of the infringing goods and to indemnify the Customs office for damages incurred during the retention/destruction.
Once registered if the Customs office finds infringing goods, they have the right to detain them and inform the rights holder and the importer. The goods can be detained for a period of 10 days with an extension of another 10 days based on the rights holder’s application (if the goods are not perishable). For perishable goods, the period is 3 days extendable by another 4 days.
The rights holder may take samples of the infringing goods for testing.
If customs has detained the goods and the rights holder does not respond within 10 days the goods will be released
If customs has detained the goods without giving notice to both sides the goods will be granted clearance after 5 days.
While applying for the notice you would need the following:
- Copy of the Registration Certificate
- Statement of the grounds of release of goods allegedly infringing IPR
- Assignment deed
- Pictures of rights holders goods.
- Demand Draft for the fees (INR 2000 per application (USD 35) – one for each custom house)
- Bond and Surety
- Indemnity Bond
- Any other documents/ requirements of the Customs Officer (sample goods etc.)
Centralized Bond: This bond has to be executed in one custom office, for an amount determined by the rights holder. This has to be accompanied by a surety of 25%. This bond will be given a Bond recognition number (BRN). If the rights holder has given notice in more than one office, in the event of infringement and detention in any one office, the amount deposited with the central bond can be used in any of the customs houses.
While this works for all infringing and counterfeit goods, this would not apply to Goods of a non-commercial nature contained in personal baggage or sent in small consignments intended for personal use of the importer. Additionally parallel imports of designs and GI are not allowed, but for patents they are allowed and for trademarks they will be allowed provided that the products are not materially altered.
So if you know of any impending shipment of counterfeit/infringing products or if you just want to protect yourself from the possibility of infringing imports recording you IP with the Customs houses can be valuable. If you have a registration certificate for a trademark, copyright or design or a granted patent, you could record it with customs to make sure that you stop infringing products at the gates!