The Legislative Yuan passed the Patent Act amendment on border protection in January.  The Patent Act amendment was entered into force by the Executive Yuan on March 24. The related “Regulations Governing Customs Detaining Goods Suspected of Patent Infringement” with respect to said amendment were also entered into force by the Ministry of Economic Affairs and Ministry of Finance on March 24.

Prior to the implementation of the Patent Act and the said Regulations, Customs would detain goods only after having received a judicial injunction ordering the detention of the imported goods  that infringe upon the subject patent. Customs also would  suspend the import or export of the related accused products only after the patentee had provided detailed information of the specific time, place, conveyance, vessel, and voyage of the accused goods. In the past practice, however, since a patentee could not acquire all the specific information of the imported goods, such as: detailed vessel, voyage, etc., the patentee rarely was able to successfully detain the accused goods.  After the implementation of the Patent Act and Regulations, the amended Act and Regulations allow a patentee to request Customs to detain the imported goods that are suspected of infringing his patent right by providing a security and attaching the document(s) of proof of the patent infringement and a sufficient description enabling Customs to identify the goods to be detained. The patentee consequently may obtain the border protection in time. 

Highlights of the newly amended Act and Regulations are as follows:

  1. An applicant to detain goods shall specify the facts of infringement, attaching document(s) of proof of the patent right(s) and an infringement analysis report.  An applicant shall provide a sufficient description enabling Customs to identify the goods to be detained, for example, the importer, declaration numbers, name of goods, model numbers, specifications, the possible imported date or conveyance etc., in order for Customs to carry out the detention. The applicant shall also provide a security amounting to the duty-paid price of the imported goods and shall commence a litigation claiming that the detained goods infringe upon the applicant’s patent right(s) within twelve days, otherwise Customs will repeal the detention.
  2. Prior to carrying out the detention, Customs may ask the applicant to provide assistance. Such request for assistance should not be rejected without any justifiable reasons. The parties may request Customs to examine the detained goods after the detention, and the examination shall be carried out in compliance with the time, place and manner specified by Customs.
  3. The owner of the detained goods may request Customs to repeal detention by providing a security bond or equivalent assurance amounting to two times of the duty-paid price of the imported goods. Customs may release the imported goods by retaining a representative sample. Moreover, in case of either the final dismissal of the litigation initiated by the applicant or a court of law in a final and binding judgment has held that the detained goods do not infringe the patent right(s), the owner of the detained goods may also request Customs to repeal detention to release the imported goods.
  4. If a court of law in a final and binding judgment has held that the detained goods do not infringe the applicant’s patent right(s), the applicant shall be liable to compensate the owner of the detained goods for the loss incurred from such detention or from providing the security. The applicant shall also be liable for relevant costs including demurrage, warehousing, loading, and unloading in this situation.
  5. The parties filing a request with Customs for the return of the security or assurance shall state the grounds thereof and provide, if applicable, the following document(s): (1) a copy of a judgment of the court along with a copy of a certificate stating the judgment is final and binding, or a copy of a document which legally has the equivalent effect as a final and binding judgment of the court; (2) a copy of a settlement agreement; (3) a copy of a document proving that the other party has been notified to exercise the right within a specified time period of no less than twenty days but has yet to do so within the said period; (4) a copy of a document proving that the other party has agreed upon such return.