In November 2009 the Court of Appeal in Nokia Corporation v Her Majesty's Commissioners of Revenue & Customs referred questions to the ECJ following Nokia’s challenge to UK Customs’ policy of not detaining suspect counterfeit goods in transit through the UK from one non-EU country to another non-EU country without evidence of diversion on to the EU market.

European and English case law has concluded that goods in transit do not constitute trade mark infringement for the purposes of UK and EU trade mark law (including the Trade Mark Regulation 1993 (the “Regulation”), except where there is a proven risk that the goods will end up on the EU market.

In July 2009, the English High Court accordingly rejected an application by Nokia for judicial review of UK Customs’ (HMRC) decision to release a consignment of counterfeit goods bearing Nokia’s trade marks in transit through the EU.

Nokia appealed and the Court of Appeal and decided to refer to the ECJ the question whether non-EU goods in transit from one non-Member State to another non-Member State are capable of constituting “counterfeit goods” within the meaning of Article 2(1)(a) of the Regulation if there is no evidence that they will be released into free circulation in the EU or be illicitly diverted onto the EU market.

Comment: It seems possible that the ECJ might find a way to authorise detention of obviously fake goods, such as those in the Nokia case, whilst maintaining the status quo in disputed cases. Whether the ECJ chooses to take this course or not, one thing is clear – the ECJ’s response will be of significant commercial impact for holders of intellectual property rights and importers of goods worldwide including pharmaceutical brand owners continuing to battle with the threat of counterfeit drugs.