1. What is Intellectual Property Right (IPR) Border Enforcement?
“Fakes” such as counterfeit and pirated products which infringe intellectual property rights (IPRs) have no guarantee of quality, and the use of “fakes” may pose risks of potential harm to public health and accidents. In addition, the flood of goods which infringe IPRs, such as patent and design rights which protect remarkable inventions and unique designs, may be a potential deterrent to sound economic growth.
Like handguns and drugs, the export and import of goods which infringe IPRs are prohibited. Japanese Customs inspects articles exported/imported at airports and seaports, and stops goods which infringe IPRs at the border.
2. Flow of IPR Border Enforcement
The flow of Customs Enforcement procedures for goods which infringe IPRs in Japan is shown below. (For Imports)
I. Motion for Import Injunction
i. A right holder submits a form for a Motion for Import Injunction with the relevant documentation to Customs for the goods which are alleged to infringe the holder’s right.
ii. Upon receipt of the Motion for Import Injunction from the right holder, Customs publicizes the Motion against the alleged goods on Customs’ website.
iii. Customs conducts an examination on the basis of opinions and evidence which have been submitted by the petitioner of the Motion (right holder) and the interested parties, and then makes a decision regarding the disposition of the Motion (Acceptance, Non-Acceptance, Hold).
1. Acceptance: Customs publicizes the alleged goods on Customs’ website, and monitors the goods for two years. In addition, an extension of the monitoring term is allowable.
2. Non-Acceptance/Hold: Customs does not publicize the alleged goods on the website. If a party is dissatisfied with the disposition of the Motion, he/she may file an Opposition with the Commissioner of Customs. Furthermore, the party may file a request for examination with the Minister of Finance against the decision on the Opposition issued by the Customs’ Commissioner. If the party objects to the Finance Minister’s decision, he/she may lodge a suit with the Court in an attempt to cancel the decision.
II. Identification Procedures
i. When allegedly infringing goods have been discovered at Customs by the Customs’ authority or by receipt of a Motion, the Commissioner notifies the right holder(s) and the importers of the alleged goods of the fact that “Identification Procedures” will be initiated. At that time, the Commissioner notifies the right holder(s) of the importers’ names (appellations) and addresses, and the manufacturers’ names (appellations) and addresses. The Commissioner also notifies the importers of the right holders’ names (appellations) and addresses.
ii. The Commissioner provides the right holders and importers with opportunities to submit to Customs their opinions and evidence regarding whether or not the alleged goods infringe IPRs.
iii. If the evidence submitted by the parties forms a basis for a finding, the Commissioner provides the right holders and importers with opportunities to comment on the evidence.
iv. The right holders and importers are notified of the results of the Identification Procedure along with the reasons therefor.
As described above, the Identification Procedures in IPR Border Enforcement are conducted by Customs. Compared with Customs in foreign countries, Japanese Customs assumes a strong and extensive system of enforcement where Customs is empowered to judge whether or not alleged goods infringe IPRs, to suspend import/export of the alleged goods, and to confiscate and destroy the goods at the authority of the Commissioner. Thus, there is no need for the Court to make judgments and decisions of infringement of alleged goods.
III. Processing after Identification
(A) When the alleged goods are NOT identified as goods which infringe IPRs: The import into Japan of such alleged goods may be permitted.
(*) According to the Customs Law in Japan, if a petitioner (a right holder) initiates Identification Procedures, he/she cannot file an Opposition.
(B) When the alleged goods are identified as goods which infringe IPRs:
• A party who is dissatisfied with the result may file an Opposition with the Commissioner of Customs. Furthermore, the party may also file a request for examination to the Minister of Finance against the subsequent decision on the Opposition. Finally, a party who is dissatisfied with the Finance Minister’s decision may lodge a suit with the Court requesting cancellation of the decision.
• The import into Japan of such alleged goods is banned.
- Importers may take the measure of “Voluntary Disposal” (e.g., abandonment, destruction). When a certificate of consent to import is not obtained from the right holder(s) and all means for objection have been exhausted, Customs may finally confiscate and destroy the goods.
Figure 1: Flow of Japanese Customs Border Enforcement against Goods Alleged Infringing IPRs (For Imports)
Source: “Intellectual Property Rights Border Enforcement by Japanese Customs”
(Japanese language website)
3. Advantages of the IPR Border Enforcement System
The IPR Border Enforcement system has the following advantages:
(A) Wide range of intellectual property rights which serve as the basis for a Motion for Import/Export Injunction
Here are the subjects of enforcement:
• Trademark rights, copyright and related rights, patent rights, utility model rights, design rights, and breeder’s rights. (* Rights of layout designs of integrated circuits are also the subject of IPR Border Enforcement when importing goods.)
• Product labeling is widely recognized among consumers and may cause confusion with other products, etc.
Product labeling may be identical or similar to that of a well-known product.
• Goods might imitate features of other products.
(B) Easy and fast procedure
Period of the IPR Border Enforcement Motion at Customs:
- From receipt of a Motion for Import Injunction until disposition of the Motion (Acceptance, Non-Acceptance, Hold).
- Japanese Customs aims to complete the procedure within one month. (Even when “Customs seeks opinions of an expert committee” (*), Customs aims to complete the procedure within three months.)
(*) Seeking of opinions from an expert committee: Customs may seek the opinions of an “expert committee” having sufficient knowledge and experience in the area of IPRs (lawyers, patent attorneys, and scholars).
(C) Lower Cost
• There is no Official Fee. (* Unless the fees for “Deposition” are sought.)
• Agents’ fees are generally low since the duration of the Motion may be shorter than that for an infringement lawsuit.
(D) Strong Effect of Enforcement and Effect as a Deterrent against Potential Infringement
• It is effective as a means for keeping an eye on the importation of infringing goods since the status of receiving a Motion for Import Injunction and acceptance of the Motion will be released on the Japanese Customs website.
• When alleged goods are identified during the Identification Procedures as goods which infringe IPRs, importation will be suspended immediately. Suspension of importation will continue even during an Opposition.
• When no further measures are available, the alleged goods are confiscated and destroyed.
4. Utilization of IPR Border Enforcement System
According to statistics issued by the Ministry of Finance, the number of valid Motions for Import Injunction (Acceptance) in 2012 was 716. The breakdown of the statistics is as follows.
Patent Rights: 18 cases
Design Rights: 73 cases
Trademark Rights: 213 cases
Copyrights: 91 cases
Related Rights: 313 cases
Breeder’s Rights: 1 case
Goods relating to Unfair Competition: 7 cases
As shown above, the number of related rights, copyrights, trademark rights, and design rights was large among valid Motions for Import Injunction (Acceptance) in 2012. This shows that measures against counterfeit products and apparently counterfeit products are a central aspect of the enforcement.
IPR Border Enforcement by Japanese Customs covers a wide range of goods which infringe IPRs which are subject to Motions for Import/Export Injunction. In addition, the procedures are easier, faster and less expensive than those for infringement lawsuits. Furthermore, the enforcement has potent effects and can be expected to act as a deterrent against infringement. Therefore, if IPR Border Enforcement by Customs is performed well, it will no longer be necessary to take measures to eliminate infringement in Japan. It can be said that the enforcement of IPRs is quite useful as a means of exercising one’s rights against the importing and/or exporting of goods which infringe IPRs to/from Japan.
Reference (the following are all Japanese language websites):