The United Arab Emirates ranks second in the world (behind China) in the 2016 Agility Emerging Markets Logistics Index. To put this in context, China’s economy is 25 times larger than that of the United Arab Emirates. Indeed, in this index the United Arab Emirates outperformed countries with much larger economies than its own, including India and Brazil.

The United Arab Emirates achieved this success thanks to a combination of market access, low risk level, regulation, foreign investment, urbanisation and wealth distribution.

The protection and enforcement of IP rights is essential for foreign investment; this is why the United Arab Emirates has made important strides in regulating some of the vital legal aspects of its rapidly expanding economy.

In recent years the United Arab Emirates has amended some of its laws and policies, as well as the internal regulations of many of its government departments, to attract more investment and safeguard the rights of investors.

As a result of these efforts, the Global Competitiveness Report issued by the World Economic Forum for 2015 to 2016 ranked the United Arab Emirates 22nd in the world for IP rights protection.

Legal framework

In 1971, when the rulers of the seven emirates agreed to form the Federation of the United Arab Emirates, they also agreed on the provisional Constitution, which provides the legal framework for the federation.

The following laws relate to IP rights and their protection in the United Arab Emirates:

  • the Federal Copyright Law (7/2002), which grants copyright protection for the lifetime of the author plus 25 years. Photographic works are protected for 10 years only;
  • the Federal Patents, Designs and Industrial Models Law (17/2002), which protects:
    • patents for up to 20 years from the registration date;
    • designs for up to 15 years from the registration date; and
    • utility patents for up to 10 years from the registration date;
  • the Federal Trademark Law (8/2002), which grants trademark validity for 10 years from the date of filing and can be renewed for a similar period; and
  • the Anti-commercial Fraud Law, which replaces Law 4/1979 on the Suppression of Fraud and Deception in Commercial Transactions.

The United Arab Emirates is a signatory to:

  • the World Intellectual Property Organisation (WIPO) Convention;
  • the Paris Convention for the Protection of Industrial Property;
  • the Berne Convention for the Protection of Literary and Artistic Works;
  • the Patent Cooperation Treaty;
  • the WIPO Copyright Treaty;
  • the Rome Convention; and
  • the WIPO Performances and Phonograms Treaty.

The Gulf Cooperation Council (GCC) was established in accordance with a 1981 agreement between Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. UAE IP procedures thus comply with GCC legislation.

GCC Unified Trademark Law

The GCC Unified Trademark Law was approved by the Supreme Council in 2012, after which it was published in the official gazettes of GCC states and became effective.

This law does not provide for a single application to have protection in all six member states; thus, different applications must still be filed separately in each country.

However, the law has harmonised and unified the registration and enforcement of trademark rights across the GCC member states.

GCC Patent Law

The GCC Patent Law provides for a central patent right covering all member countries.

GCC Unified Customs Law

Since the establishment of the GCC customs union on January 1 2003, the United Arab Emirates has applied the GCC Unified Customs Law and its procedures. By establishing a single customs union with free internal movement of goods, the law allows for the detention of suspected infringing goods even if they are in transit, as follows:

Article 55

When the customs office suspects the presence of prohibited or illegal goods, it shall have the right to open the packages for inspection. Such opening of packages may be authorized in the absence of the owner of the goods or his representative, if he refrains from attending the inspection at the specified time notified to him.

When necessary, the customs office may inspect the goods before notifying the owner of the goods or his representative.

In the United Arab Emirates, IP rights can be enforced through criminal, civil and administrative routes. Administrative proceedings are available in some emirates, such as Dubai, Sharjah, Ajman and Ras Al Khaima.

Some government departments have been granted quasi-judicial authority to enforce trademarks in the country. The development departments of the emirates of Dubai and Sharjah have jurisdiction to inspect open warehouses, punish infringers, seize and destroy goods and impose fines.

Thanks to the hard work of their officials, the vast majority of trademark infringement actions carried out in Dubai and Sharjah in recent years have been through these active and highly efficient development departments.

According to a January 14 2016 Emirates News Agency article, the continued efforts of the Dubai Development Department reduced the number of IP infringement cases to 5,101 in 2015 (from 5,897 in 2014). This reflects the improved efficiency of the raids carried out by the department.

Border measures

Protecting the borders is always the first step in an anti-counterfeiting strategy.

In the United Arab Emirates, the procedural protection of IP rights starts with the recordation of trademarks with the customs departments. A system to help customs officials to target, intercept and confiscate shipments of infringing goods was first introduced by Dubai Customs in 2006, followed by Sharjah Customs in 2007. Ajman implemented the same systemised protection in 2015.

Customs recordation has another fundamental objective: once the rights holder has recorded its trademark with Customs, Customs can implement an ex officio border system against infringement of those trademarks.

The ex officio system saves rights holders time by sparing them the obligation to seek judicial orders to detain infringing shipments (as required by the standard border system).

As mentioned above, Article 55 of the GCC Unified Customs Laws allows customs inspectors to investigate any consignment to ensure that it conforms with its declared information.

After allegedly infringing goods have been detained, Customs will contact the local legal counsel whose name is registered on the customs recordation application.

A valid application allows Customs to detain suspicious goods for three working days from the date of notification. The rights holder may submit written confirmation (through its local legal counsel) as to whether the detained goods infringe its IP rights and, if so, whether it wants to file an official complaint against the owner of the shipment. If the rights holder fails to communicate with Customs, the goods will be released.

Regardless of whether the rights holder wishes to take legal action against the infringer, it should maintain a close relationship with the IP department in Customs and always advise whether detained goods are counterfeit.

It is difficult to monitor all shipments coming through the borders due to the high volume of goods that enter through UAE ports (particularly Dubai); therefore, more coordination is needed at a federal level.

Criminal prosecution

Articles 37 and 38 of the Trademark Law relate to penalties for infringement. Under these articles, any party can file a complaint before the police against an act of trademark infringement. The criminal action can be filed directly with the police or public prosecutor in the emirate where the counterfeit goods are located.

In some cases, the police will also seize documents, files and electronic data that are linked to the crime. During the criminal prosecution, the seized goods are stored at the expense of the rights holder.

The remedies available through a criminal action include:

  • raids of premises where counterfeits are produced;
  • seizure of counterfeits and the tools used for their manufacture;
  • destruction of seized counterfeits;
  • imposition of a fine and a criminal record; and
  • in case of repeated offences, imprisonment and further punishments.

Article 39 of the Federal Trademark Law provides that:

Any person who commits for the second time one of the offenses mentioned in Articles 37 and 38 of this law, shall be punished with the same punishment in addition to the closure of his commercial store or enterprise for a period not less than fifteen days and not exceeding six months, together with the publication of the judgment on the expense of the guilty party.

Civil prosecution

Although both the criminal and administrative routes for enforcement are efficient in the United Arab Emirates, compensation for rights holders for IP infringement has so far been granted only by civil courts.

Civil compensation can be awarded once the key infringer has been identified and its financial worth and assets have been confirmed as sufficient to cover the damages and costs claimed. This is no easy task, since many of these traders are very careful and are not linked directly to illegal activities.

A civil action can be filed against an infringer jointly with a criminal complaint, after a final decision has been issued by the criminal court or without initiating a criminal case.

Remedies that can be achieved by civil actions include:

  • precautionary attachment;
  • interim injunction;
  • perpetual insinuation and attachment with a declaration that the goods are counterfeit;
  • appointment of an expert to provide an opinion; and
  • costs and damages.

Statutory or punitive damages are unavailable, as the Federal Trademarks Law makes no provision for such remedies.

Anti-counterfeiting online

The Dubai Economic Development Department announced in 2015 that its anti-counterfeiting action had expanded into the online space, having successfully closed 1,009 Instagram accounts (with 31.2 million followers) that were used to sell counterfeit goods.

A great deal of specialised training and assistance is required to grasp the ever-changing and fast-moving nature of these crimes.

Preventative measures/strategies

The most effective preventative measures are as follows:

  • Maintain valid customs recordation with the various customs authorities in the United Arab Emirates.
  • Maintain work on the ground by carrying out market searches, surveys and online monitoring to gather as much information as possible about the flow of counterfeits in and out of the United Arab Emirates.
  • Maintain a close relationship with the local IP enforcement authorities that are carrying out market surveillance and random raids against infringers.
  • Provide local training for customs officials, since they are proactive in the United Arab Emirates and it is thus valuable to educate them on how to distinguish between counterfeits and genuine goods and to ensure that they have up-to-date tools and information about the rights holder’s products.
  • Participate in consumer protection initiatives. The United Arab Emirates is very active in this field, so rights holders should participate in any public awareness campaigns about the harm that counterfeits inflict on consumers, rights holders, the general public and the economy as a whole.

These preventative measures and more can be easily achieved by using competent and experienced local counsel who will advise the rights holder on all the above points and maintain a close relationship with local authorities in order to effect the anti-counterfeiting plan that will reap the best results.

Malek Khalifeh

This article first appeared in World Trademark Review. For further information please visit www.worldtrademarkreview.com.