Legal framework The Finish IP laws are in line with EU law and international agreements such as the Agreement on Trade-Related Aspects of debt Intellectual Property Rights. The enforcement of IP and other rights relevant to anti-counterfeiting actions in Finland is set out under various statutory instruments, such as: • the Trademarks Act (7/1964); • the Patents Act (550/1960); • the Registered Designs Act (221/1971); • the Copyright Act (404/1961); • the Criminal Code (39/1889); • the Unfair Business Practices Act (1061/1978); • the Act on Securing Evidence in Civil Matters concerning Industrial Rights and Copyrights (344/2000); • the Act on Procedures in the Market Court (100/2013); • the Code of Judicial Procedure (4/1834); • the EU Customs Regulation (608/2013); • the EC Community Trademark Regulation (207/2009); and • the EC Community Designs Regulation (6/2002). Border measures Customs applications for action Border measures in Finland are governed largely by the EU Customs Regulation. Under the regulation, the rights holder may file a national application for action covering Finland only or a union application for action through Finnish Customs under which suspected counterfeited or pirated goods may be seized throughout the European Union, depending on which countries the rights holder considers relevant. Customs applications are valid for one year. Customs may also seize goods ex officio – in such cases the rights holder must file the customs application within four working days of notification if it wishes to take action. If a valid customs application is in place, the rights holder has 10 working days (extendable by a further 10 days) to take action. In accordance with the EU Customs Regulation, Customs may seize goods that
are suspected of being counterfeit or pirated. Customs may also seize goods bearing signs that are confusingly similar to the trademarks included in the customs application. However, Customs cannot seize goods which are manufactured with the rights holder’s consent, but intended for sale elsewhere, or which have been manufactured by a duly authorised person but in a larger quantity than was agreed between the rights holder and the manufacturer. If the rights holder decides to take action against counterfeit goods seized by Customs, it may try to negotiate with the recipient and obtain consent for their destruction within the statutory timeframe (10 plus 10 working days). If no consent for destruction is obtained within that period, the rights holder shall either file a request for criminal investigation with Customs or instigate civil proceedings before the Market Court. Most cases result in a settlement and destruction; only those cases where there is a dispute over the infringing nature of the goods seized are tried before courts. New EU Customs Regulation The new EU Customs Regulation (608/2013) is intended to facilitate anti-counterfeiting measures at borders. For example, the simplified destruction procedure, which is mandatory under the new regulation, was not previously part of the Finnish legal system. The new system should save costs for rights holders in straightforward cases, although it remains to be seen how Customs will apply its discretion in consenting to destruction in cases where the declarant or holder remains passive. According to Finnish Customs, whether this type of implied consent is deemed adequate will be assessed on a case-by-case basis. If consent is granted in a manner approved by Customs, the rights holder must destroy the seized goods at its own cost under customs control. Another new aspect of the new EU regulation is the possibility to destroy small consignments (postal shipments of up to three units or with a gross weight of less than 2 kilograms) if the declarant or holder of the goods does not object. In the case of small consignments, Customs will not check the alleged infringement separately from the rights holder, but rather will notify the declarant or holder of the goods directly concerning the planned destruction. If the destruction can be performed easily and without special customs action, Customs will not necessarily charge the rights holder for the destruction costs. In the application for action the rights holder must specifically request the application of the small consignments procedure. Even when the simplified destruction and small consignments procedures are applied, the rights holder is still entitled to claim compensation from the infringer or other persons for the destruction and other costs of the infringement. Criminal prosecution The wilful infringement of IP rights is prohibited under the Criminal Code. If the infringement is liable to cause considerable harm or damage to the rights holder, the penalty is a fine or imprisonment for up to two years. In a criminal prosecution, the rights holder must claim punishment for the crime committed; otherwise the public prosecutor cannot bring charges. The rights holder may request the public prosecutor to represent it in a civil damages claim, but in practice, the rights holder should be prepared to represent itself in damages matters. The competent court to rule on all crimes related to all IP rights other than copyright is the Helsinki District Court, from which the case may be appealed to the Helsinki Court of Appeals and the Supreme Court (if leave to appeal is granted). For copyright crimes, the competent courts are determined based on the Criminal Procedure Rules, which provide that the competent court is that with jurisdiction over the area where the infringing act occurred. Although the criminal prosecution of IP crimes is not common in Finland, a rights holder should not ignore criminal prosecution for an IP infringement. The investigative work carried out by the police may bring additional clarification and, unlike in civil proceedings, new relevant facts may be submitted at any stage of the proceedings. Civil enforcement Settling disputes Most anti-counterfeiting cases end in an outof- court settlement. The parties may ask the court to confirm the settlement terms, making it equivalent to a final court judgment.
Preliminary injunctions and precautionary measures The Finnish legal framework lays down various measures which rights holders can take before instigating a main infringement action, including: • preliminary injunctions (also ex parte); • other preliminary measures necessary to secure the rights holder’s interest; and • seizure of documents or other material as evidence (also ex parte). The seizure of documents or other material is particularly suited to anti-counterfeiting matters. Such seizure may also take place without notifying the alleged infringer and thus maintaining the benefit of surprise. If the rights holder seeks preliminary measures, it should be prepared to deposit security with the bailiff. The amount of security is determined by the bailiff and depends on the case at hand; however, it may well be tens or even hundreds of thousands of euros, especially if the scale of infringement is high. Main actions on merits If a preliminary injunction or other precautionary measure has been granted, the main action shall be brought within 30 days of grant. Subsequently, both parties submit written pleadings and the case is then assigned to a preparatory hearing and a main hearing, where the parties present their main arguments and witnesses. Civil proceedings in Finland follow the principle of free evaluation of evidence, meaning that all material may be submitted as evidence. However, no new evidence or facts may be brought after the case has been assigned to a main hearing. Remedies Among other remedies, the rights holder may claim: • an injunction order against the infringer; • reasonable compensation for the unauthorised use of the IP right in question; • actual damages for the infringing act; • modification or destruction of goods that infringe a trademark; • modification, destruction or confiscation of goods that infringe a patent or registered design; and • compensation for legal fees and party costs. In general, the main remedies that the rights holder can expect are an injunction, an order for the modification, destruction or confiscation of infringing goods and reasonable compensation for unauthorised use of the IP right. The amount of reasonable compensation corresponds to a hypothetical licence fee that the infringer would have paid to use the IP right. The Finnish courts are reluctant to grant actual damages, especially in high amounts, mostly because the rights holder has a high burden of proof to show that: • damage has been suffered; • the damage was causally linked to the infringement act; and • the amount of damage claimed corresponds to the amount actually suffered. Nevertheless, rights holders are usually compensated in monetary terms for the unauthorised use of their IP rights, as well as the legal fees and party costs. The main rule is that the losing party shall pay all fees and costs of the winning party, provided that these are reasonable. Market Court The competent court for the civil enforcement of IP rights is the Market Court. Before September 1 2013, the competent court was the Helsinki District Court (except copyright infringements, which were handled in the district court of the defendant’s domicile). In accordance with the new procedure, all industrial and intellectual property rights disputes (excluding criminal matters), as well as complaints regarding decisions of the National Board of Patents and Registration of Finland in rights registration matters, will be handled by the Market Court. IP crime remains under the jurisdiction of local district courts. The main change concerns the appeals process. A rights holder no longer has the option to lodge an appeal with the Helsinki Court of Appeals. Instead, all appeals are lodged with the Supreme Court, if it grants leave to appeal. As the Supreme Court grants leave to appeal only in special circumstances, it is likely that most Market Court judgments will remain final. The lack of an appeal court stage should
reduce the duration of IP proceedings. Under the previous system, if the case was heard at all instances, it took at least two to three years for a final decision to be issued. It would be surprising if the new system did not improve this. Unofficial statements have suggested that the Market Court is striving to maintain its average processing times; should this be the case, decisions may be issued in around six months in future. Another new aspect of the legislative change is that the new proceedings make it possible, in certain circumstances, for the Market Court to handle a matter combining trademark infringement, unfair business practices, a damages claim and a licence agreement breach. Under the previous system, such disputes had to be divided into several parallel trials handled by different courts of law, which is why such proceedings were rarely instituted in the past. Anti-counterfeiting online Counterfeit and pirated goods are widely sold online in Finland. However, most websites offering counterfeit products in Finland tend to be foreign, often with poor Finnish translations. In addition to professional websites with a clear commercial purpose, private individuals advertise the sale of counterfeit or pirated goods on Finnish online auction websites. In light of the practical challenges of taking action against foreign websites, rights holders now pay more attention to the sale of counterfeit goods by private vendors through Finnish online auction websites. Such private vendors usually post sales announcements for counterfeit goods and order products from foreign countries, especially China. In most cases, the products are usually purchased by the private vendor in accordance with the orders received and then shipped by post directly from the foreign country to the individual purchasers. No large stock is held and the private vendor acts only as a ‘middleman’ in the transaction. As a result, most counterfeit products in Finland are shipped in small consignments, making enforcement more difficult. It remains to be seen how the new EU Customs Regulation and the special procedures regarding small consignments will affect this. The notice and takedown systems used by Finnish online auction websites work efficiently and several rights holders have found them useful in anti-counterfeiting actions. A rights holder may also ask the competent court to order a third party (eg, an internet service provider or an online auction website) to disclose the identity of a suspected infringer – a remedy which is widely used. Preventive measures/strategies Effective anti-counterfeiting strategies require rights holders to have a good relationship with Customs and other anti-counterfeiting bodies, as well as a certain degree of initiative. Customs plays a key role in the Finnish anticounterfeiting scene and intervenes actively to tackle suspected counterfeit goods at the borders, especially if the rights holder has a valid customs application and regularly pursues cases detected by Customs. Customs has suffered major budget cuts and organisational changes in recent years, so it is vital for a rights holder to show that it values the work done by Customs. Good connections in the Finnish anticounterfeiting field are also essential for a successful anti-counterfeiting strategy. Lawyers specialising in anti-counterfeiting matters commonly share information regarding suspected counterfeit goods. Such lawyers also regularly convene at events organised by the Finnish Anti-counterfeiting Group (FACG). The FACG is regularly tipped off about suspected counterfeit or pirate goods by private consumers. In addition, the Copyright Information and Anti-Piracy Centre has members which mainly consist of associations and companies representing copyright owners or owning copyright. As elsewhere, a rights holder should consult local counsel when carrying out anticounterfeiting measures in Finland. In particular, the ability to communicate in Finnish and the thorough knowledge of the Finnish praxis are practical prerequisites for effective communication with Customs and other relevant contacts.