Due to the benefits of the Internet, social media and advertising in today's global economy, consumers around the world are aware of products irrespective of where they are produced. Numerous products are traded globally. For this reason, companies no longer produce goods exclusively for their home markets; rather, they increasingly acknowledge the opportunities of globalisation.
Goods are transported across the globe using, for example, container carriers. Large, centrally located airports and strategically positioned ports serve as important international hubs for incoming cargo ships and aircraft. At the hubs freight is reloaded and redistributed for transport to final destinations around the world. Such port and airport hubs are also the centralised point of entry for goods onto the regional markets. Goods entering the hub are offloaded and transported locally or regionally using, for example, trucks, rail or inland waterways.
The benefits of the globalised consumer market are evident to companies with an international focus. Unfortunately, the benefits of globalisation are also acknowledged by parties involved in activities such as counterfeiting, piracy, parallel imports and trade in patent-infringing products, semi-finished products and raw materials. Unlawful acts are carried out in order to obtain a piece of the action.
IP strategy: indispensable to successful business strategy
Conquering the threat of unfair trade requires a stringent and international IP rights strategy. In order to protect important markets abroad, enforceable patent rights are vital.
In Europe, patents should be applied for in economically important countries such as Germany, France and the Netherlands. Often foreign companies choose to apply for a European bundle patent. A European patent can be applied for directly or during the national or regional phase of an international application under the Patent Cooperation Treaty (PCT). In many European countries, a national application can be applied for on the basis of a PCT application, although in some – including France, Belgium and the Netherlands – this national PCT route is closed. However, in the Netherlands, there is debate over reopening this PCT route. It is possible to request national patents in these countries within the priority year based on the Paris Convention.
After grant, a European patent becomes a national patent in the EU member states for which the patent holder has applied. As outlined below, in many cases it is recommended to choose the Netherlands to validate a European bundle patent, in addition to validating the patent in a country such as Germany, the United Kingdom, Poland, Italy, Spain or France. As the Netherlands is an important gateway for products into Europe, obtaining patent protection in the Netherlands may offer a company a way to prevent infringing products entering the European market. In addition, trademark protection in the Netherlands can be equally important.
Applying for customs detention and seizure measures
The possibility to apply for border detention on the basis of patent and trademark rights is a valuable tool. In EU member states, customs seizures are available through the EU Regulation on Customs Enforcement of IP Rights (608/2013).
Rotterdam Port in the Netherlands is the top EU port for goods. For example, in 2014 cargo throughput in containers was 126 million metric tons. In addition, Schiphol Airport in Amsterdam is one of the largest cargo hubs in Europe. This allows a company to start the enforcement of its IP rights in Europe centrally through a single action in The Netherlands. Intercepting infringing goods on entry into the European Union at Schiphol Airport or Rotterdam Port can effectively prevent the goods from entering other EU member states.
Dutch Customs is renowned for its willingness to help companies to protect their commercial positions in the European Union and to proactively support the enforcement of patent rights in the Netherlands and across Europe. In order for Customs to help, a company must have an enforceable IP right (eg, a patent or trademark) in the Netherlands and must submit an application for customs action to Customs. This application requests Customs to take action where a suspicion exists that an IP right is likely to be infringed on the entry of specified goods into the Netherlands. Although Customs may act ex officio, in 2014 98.3% of IP rights enforced by Customs related to applications requesting customs action. Although Customs cannot check all cargo, it can work with rights holders and their attorneys to increase the chances of success. Once infringing goods have been detained at the Dutch border, the goods are prevented from further distribution across Europe. The customs action must be followed by proceedings on the merits. If infringing goods are not stopped by Customs, they may be distributed throughout Europe and the rights holder may have to start legal proceedings in several different EU member states, which can be time consuming and costly. Thus, customs actions in the Netherlands can be effective and save both time and money.
Although Rotterdam Port and Schiphol Airport are by far the largest cargo hubs in the Netherlands, once a company has an enforceable patent right in the Netherlands goods entering the Netherlands through a smaller airport or port are also subject to customs action once an application for customs action has been granted. The other Dutch cargo airports are Maastricht-Aachen Airport, Eindhoven Airport and Rotterdam-The Hague Airport; while minor ports are located in Delfzijl, Eemshaven, Harlingen, Den Helder, Amsterdam, Zaanstad, Velsen Beverwijk, IJmuiden, Scheveningen, Schiedam, Vlaardingen, Maassluis, Dordrecht, Moerdijk and Vlissingen.
Unitary patent opens up easier way to implement customs seizures
After decades-long debate, the unitary patent will finally come into effect in 2017. The holder of a unitary patent will have an enforceable patent right in up to 24 EU member states (including Germany, Belgium, France and the Netherlands). In principle, this will allow for a simpler patenting strategy with regard to the largest EU economies. This will make patent enforcement and customs actions in Europe more straightforward.
Seizure for surrender of infringing goods
Another opportunity for patent or trademark holders in the Netherlands is to submit an application to levy a seizure for the surrender of infringing goods with the provisions judge of the competent district court. Such request is usually handled ex parte (ie, without hearing the alleged infringer). A seizure for the surrender of infringing goods is conducted by a bailiff and takes place at the infringer's premises or anywhere else that the infringing goods may be located (eg, a warehouse). A seizure for the surrender of infringing goods must be followed by proceedings on the merits.
In the Netherlands, a rights holder can levy an evidentiary seizure under a suspected infringer or a third party in order to safeguard evidence in relation to the infringement. Evidentiary seizures are conducted by a bailiff, usually assisted by an independent patent attorney and an IT expert. Seized evidence is placed in custody and access can be claimed in follow-up proceedings. Evidentiary seizures may even be based on foreign patents (eg, foreign parts of a European patent) in order to obtain evidence of infringement in other countries.
Availability of cross-border injunctions
The Dutch legal system also provides the advantage of the availability of cross-border measures in preliminary relief proceedings with regard to patent infringements. The provisions judge of the District Court of The Hague is competent to grant cross-border preliminary injunctions (ie, preliminary injunctions also covering other countries than the Netherlands) against defendants domiciled in the Netherlands (Solvay/Honeywell, European Court of Justice (ECJ), July 12 2012, C-616/10, ECLI:EU:C:2012:445). This includes not only companies with their head offices in the Netherlands, but also local Dutch entities of international companies. The provisions judge may also grant cross-border injunctions against foreign entities, provided that a Dutch infringer is also involved and it concerns infringement of (national parts of) the same European patent in multiple member states with the same infringing product (Rhodia/Jiaxing, Court of Appeal of The Hague, November 24 2015, ECLI:NL:GHDHA:2015:3923). The provisions judge may grant cross-border injunctions not only on the basis of European patents, but also on the basis of non-European patents such as those from the United States or Japan (Delaval/Boumatic, provisions judge of the District Court of The Hague, December 7 2012, IEF 12106).
The Dutch legal system provides patent and trademark holders with various time and cost-saving ways to act against infringements, including customs actions, seizures and cross-border injunction claims. These measures provide companies with valuable tools to protect their IP rights across Europe. Therefore, internationally active companies should establish patent and trademark rights in the Netherlands in order to enjoy these possibilities to the fullest possible extent.
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Bert Oosting and Ruud van der Velden of Hogan Lovells also contributed to this article.
This article first appeared in IAM. For further information please visit www.iam-media.com.