Direct selling companies may either have trade marks registered in Australia or be an authorised user of an Australian trade mark. Often the business may have international operations which involve the production and sale of goods in various territories throughout the world. Issues relating to the importation of products from one country to another (which may not be authorised) or counterfeit products, often arise. These issues can cause significant problems for the business. One step which direct selling companies can take to protect the business from these issues and try and identify infringing parties involved, is to lodge a Customs Notice. We outline details about this process below.
Unauthorised importation of products into Australia may occur in the form of parallel imported products or counterfeit goods. Parallel importation occurs when a trade mark is applied to genuine products overseas and the products are then imported into Australia by a person other than the trade mark owner or authorised user in Australia, and outside of standard authorised trading channels. In some circumstances steps may be able to be taken to prevent this occurring. Counterfeit products, in comparison, are not genuine goods and any application of the trade mark on or in respect of those products is not authorised. Steps can be taken to prevent use of trade marks in respect of counterfeit products.
In order to assist in the detection of counterfeit and parallel imported products entering into the Australian market, direct selling companies should consider lodging a Notice of Objection with the Australian Customs and Border Protection Services (Customs). As a result of the reforms made to the Notice of Objection scheme in April 2013,1 the Notice of Objection procedure has become more brand owner friendly and is an efficient and cost-effective way for reinforcing brand protection.
Notice of Objection
A Notice of Objection is a legal document that allows Customs to seize goods which:
- it suspects of infringing trade marks; or
- have been notified by a brand owner as infringing trade marks.2
The Notice of Objection can be lodged by either the registered owner of the trade mark or an authorised user of the trade mark (Objector). Provided that a Notice of Objection is in place, Customs can seize goods when they appear to be infringing and are intended for some commercial purpose.
In order to complete the Notice of Objection form, the following details must be provided:
- Full name and address of the Objector accompanied by either the company ABN (if the Objector is Australian-owned) or the Customs Client ID (if the Objector is an international company);
- Confirmation whether the Objector is the registered owner or authorised user of the trade marks being covered by the same Notice;
- Details of the legal representative of the Objector; and
- Details of the contact person that should be advised by Customs of any seizures made.
The Objector must also include the following documents when submitting the completed Notice of Objection form to Customs:
- A trade mark schedule which includes information regarding trade mark details, registration number, expiry date, class and description of goods for each trade mark to be covered by the Notice of Objection;
- An ATMOSS3 report evidencing registration of the trade marks to be covered;
- If the Objector is the authorised user of the trade mark (such as an exclusive Australian distributor), then the authorised user must enclose an Authorisation Letter from the trade mark owner which authorises them to file the Notice of Objection on the trade mark owner’s behalf;
- A Deed of Undertaking which is a formal undertaking to be executed by the Objector agreeing that it will pay any costs incurred by Customs while enforcing the Notice of Objection;
- A list of companies or individuals who are authorised to import goods bearing the trade marks covered by the Notice of Objection (optional); and
- Any information pertaining to companies or individuals importing alleged infringing goods into Australia (optional).
There is no fee payable to Customs to lodge a Notice of Objection. However, the Objector is required to pay costs incurred by Customs when suspected goods are seized. These costs generally relate to the storage, transportation and destruction of suspected goods.
Effect of Notice of Objection
The Notice of Objection scheme is a quick and cost-effective step which direct selling companies can take to assist in the protection of their brands. If Customs identifies suspect goods and they are seized (and the brand owner notified this has occurred), the onus is then on the importer (or owner of the goods) to take steps proactively to reclaim the seized goods.
The importer (or designated owner) of the goods can only reclaim the seized goods by making a claim for their release within 10 working days of receiving the Notice of Seizure from Customs. Any claim for the seized goods must contain information which is necessary to identify and contact the importer or owner of the goods. This procedure means that, if the importer or owner does not follow due process or provide accurate information, then it will not be entitled to the release of the seized goods. The stringent procedures are likely to lead to more suspected infringing goods being forfeited and reduce the number of counterfeit and parallel imported products being placed on the Australian market.
If the importer or owner of the goods does not make a claim, the seized goods will be forfeited to the Commonwealth. On the other hand, if the importer or owner makes a claim for the release of the goods, then Customs must notify the Objector and the Objector will have 10 working days to commence proceedings against the importer or designated owner.
In any event, if Customs seize goods pursuant to the Notice of Objection, the Objector will be provided with:
- Any information that Customs may have on record about the importer or owner of the goods;
- The details of the sender (i.e., the foreign exporter) and any other personal information that may assist in the identification of the sender of the goods; and
- The opportunity to inspect the seized goods or remove multiple samples of the seized goods.
This means that the Objector can obtain information that would assist it to identify if further action (such as litigation) is necessary. More importantly, it allows the Objector to identify the origin of the goods and address infringement at its source and identify any repeat offenders.
Take Home Message
- Direct selling companies wanting to protect their brand (especially those whose products are not locally made) should seriously consider using the Notice of Objection scheme.
- The Notice of Objection scheme is a quick, easy, efficient and cost-effective way to assist companies to protect their trade mark rights and to identify and prevent products which have been imported without authorisation (where possible) and counterfeit products from being available in the Australian market.
- The Notice of Objection scheme also allows companies to identify more readily the origin of the counterfeit or unauthorised parallel imported products, so that problems can be addressed at their source.