In the November/December 2009 edition of this Bulletin, we reported on the Court of Appeal's reference to the ECJ in the case of Nokia v Her Majesty's Commissioners of Revenue & Customs. This case concerned fake Nokia telephone handsets, bearing the NOKIA trade mark, arriving at Heathrow Airport in transit between Hong Kong and Columbia. Nokia applied for judicial review of HMRC's decision not to seize the handsets. HMRC had argued that the handsets were not 'counterfeits' within the definition given in the Counterfeit Goods Regulation because they had never been put on the market in the UK. The High Court upheld HMRC's actions. Nokia appealed.

The Court of Appeal made a reference to the ECJ for a preliminary ruling on the issues in this case. In December, we did not know exactly what the ECJ was being asked to rule on. We only knew that it would address the issue of whether goods in transit from one non-EU Member State to another are capable of constituting counterfeit goods within the Counterfeit Goods Regulation if there is no evidence that they will be released into free circulation in the EU or be illicitly diverted into the EU market.

Since then, the specific question that has been referred to the Court of Justice of the European Union (as it is now known) has been published. The question is:

"Are non-Community goods bearing a Community trade mark which are subject to customs supervision in a Member State and in transit from a non-Member State to another non–Member State capable of constituting "counterfeit goods" within the meaning of Article 2(1)(a) of Regulation 1383/2003/EC if there is no evidence to suggest that those goods will be put on the market in the EC, either in conformity with a customs procedure or by means of an illicit diversion."

This will be an important ruling for brand owners as an interpretation of the Counterfeit Goods Regulation in line with that of the High Court in this case would effectively limit their trade mark rights. They would not be able to use their trade marks to intercept the goods at an EU customs point preventing their subsequent sale in the non-EU destination territory. Instead, they would have to take action in the destination territory itself which could be costly and difficult.

We will report further when we have the Advocate General's opinion.