Australians might be alarmed to know that counterfeit goods are entering Australia every day including in the areas of healthcare, food and beverages. Changes to current Customs Notice provisions are designed to help stem the flow.

International customs and border protection organisations are increasingly collaborating to manage the volume of counterfeit trade. For example, Australian Customs and Border Protection and US Customs Border Protection are cooperating on measures in various areas. A recent focus on the technology sector has seen the two organisations identify a number of brands where international efforts would be assisted by Australian Customs Notices of Objection (Customs Notices).

Customs Notices and proposed changes in the favour of brand owners

For Australian Customs to detain goods at the border as suspected counterfeits, which infringe protected trade marks, a Customs Notice must be filed by the trade mark owner. To file a Notice, the trade mark/s must be registered with IP Australia.

The Customs Notice enforcement system applies to commercial quantities of goods. Overall, the process is relatively inexpensive and can result in the seizure of substantial quantities of counterfeit goods.

Under the current process, the onus is on the trade mark owner to establish that the seized goods are counterfeit. This will shortly be improved to reverse this onus. The change will come into force in April 2013, requiring an importer of seized goods to establish the goods are not counterfeit.

Briefly, the current process is as follows:

  • A Customs Notice application must be filed with the Australian Customs Service detailing the registered trade mark rights on which the Notice is based. The general customs recommendation is to list all of your registered marks to ensure a wide net for counterfeit goods can be cast;
  • Notices cover a period of 4 years from lodgement, but can be withdrawn at any time. It is anticipated that any customs notices in place when the new provisions come into force will simply continue;
  • The Customs Service will only place the watch over commercial quantities of goods. This may not catch purchases from overseas based sales websites, which often send orders directly to the end consumer from outside of Australia (that is, goods are not imported into Australia in commercial quantities);
  • The objector needs to provide a list of companies or individuals authorised to import goods bearing the trade marks so that their goods are not inadvertently seized;
  • If a suspect shipment is seized by Customs, and the importer refuses to forfeit the goods to the objector, the objector has 10 days to commence legal action against the importer (during which time the importer can voluntarily forfeit goods to the Commonwealth). This 10 day period may be extended by a further 10 days only.

At present, an objector must act quickly for the seizure to be effective, unless the importer voluntarily forfeits the goods. Currently, in practice we find that the importer will simply sit tight until such time as infringement proceedings are commenced as the goods will be returned to them in the event proceedings are not started in time.

Under the new 2013 provisions, this will no longer be an option for importers, as goods will automatically be forfeited to the Commonwealth unless the importer files a Claim for Release with Customs within a designated “claim period” (this period has yet to be settled).

Brand owners and consumers will be pleased to know that action is being taken to stem the increase in counterfeit products entering Australia. For the proposed improvements to Customs Notices to be effective, brand owners must continue to register their brands with Customs to empower the seizure of suspected counterfeit products.