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China IPR SME Helpdesk
Using Customs to Protect and Enforce
Intellectual Property Rights in China
Alessandra Chies Ferrante Intellectual Property
16 April 2014
16 April 2014 2
Welcome to the webinar
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Aleksandra Cybulska Project Officer
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Snapshot: Helpdesk Services
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Today’s Speaker
Name: Alessandra Chies
Firm: Ferrante Intellectual Property
Location: Beijing
Email: [email protected]
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Agenda • General introduction on customs border protection of IPR • How the customs border protection works in China • Custom recordal (ex-officio detention and detention upon
application) • Custom bond in ex-officio detention • Disposal of infringing goods • Cooperation between customs and Public Security Bureau • Importance of Customs trainings • Summary of core issues and Case study
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Poll 1 Question: Do your business dealings in China
involve import/export goods to/from the country?
A. Yes, both import and export
B. Yes, only import
C. Yes, only export
D. No
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• Customs protection of your registered intellectual property rights is a core aspect of every successful IP protection strategy
• IP rights that can be protected: registered trademarks, designs, patents, utility models, copyrights
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Importance of Customs Border Protection of IPR
• China Customs supervise both importation and exportation • Infringing goods can be stopped before they enter foreign
markets • You can receive information and evidence about infringing
activities • Deterrent effect for future infringements:
9 The goods will be confiscated and a fine imposed on the infringer 9 The exporter ‘s credibility may be affected if found exporting
counterfeits 9 For seizures that met the criminal threshold, the case can be
transferred to the Police for further investigations 16 April 2014 10
What are the advantages of Customs protection?
• 2006 Global Anti-Counterfeiting Award awarded to Chinese Customs
• 2007 WCO (World Customs Organization) awarded China Customs for its outstanding contributions in fighting against counterfeiting and piracy
• 2011 China Customs awarded the Prize for Outstanding Achievement in IPR Protection in China presented by Association of Chinese Enterprises with Foreign Investment
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China Customs awarded for outstanding contributions in fighting against counterfeits
¾ The contact point for a particular IP right has to be a legal person/entity domiciled within the territory of China mainland.
¾ Companies registered in China can choose to act on customs matter by itself or through an agent (remember, all documents are in Chinese)
¾ For a company which does not have a presence in China, a local agent is needed to manage Customs IPR procedures.
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Do I need an agent for managing Customs IP procedures?
1. Ex-officio detention (recordation of rights at Customs is a must)
2. Detention upon application
3. Protection in postal channel & luggage checking
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How Customs Border Protection Works in China
• Inserting in the GAC database details of your PRC registered IPRs • Documents required for Customs recordal (procedure managed
online): • Application form • Copy of Business Registration (or ID Card) of the IPR owner • Power of Attorney entrusting the agent • Payment confirmation of Official Fee (RMB 800, per each recorded
right) • Copy of IPR Certificates (trademark certificate, patent certificate,
copyright certificate, etc.)
• Note: in case of an international trademark extended to China, the confirmation certificate shall be submitted 16 April 2014 14
Recordation with GAC of your IP Rights
Aside from the basic documents, more documents are required for patents’ recordation:
1. An original copy of the evaluation report issued by SIPO is
required for a design patent whose application date is later
than 1st October 2009
2. Submit copy of patent annuity payments
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Recordation with GAC of your Patent
Aside from the basic documents:
1. A copy of the Chinese “copyright registration certificate” is
required (other evidence of copyright ownership may be
accepted)
• Notes: the Customs will hardly seize products based on
copyright on a shape of a product
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Recordation with GAC of your Copyright
1. GAC reviews documentation and approve the recordal within 30 working days after receiving the required documents.
2. Recordation lasts for the life of the right to which it refers (renewable – no fee for renewal).
3. Inform GAC of any change in ownership, cancellation of right etc within 30 days (or your recordal can be cancelled).
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Customs Recordal Timeframe & Validity
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Ex-officio Detention procedure
Revert to Customs (goods released)
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Poll 2 Question: Have you recorded your registered IP
with Chinese Customs? A: Yes, I have. B: No, but I am planning to do so. C: No
9 Insert authorized manufactures/exporters/freight companies etc. in the GAC database ¾ Be as detailed as possible - the information is not
released to the public.
9 Liaise in advance with Customs notifying of an authorized shipment .
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How can I avoid original goods being stopped at Customs?
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How is the Bond calculated?
Declared value of seized goods Required bond payment
Less than RMB 20,000 (approx. EURO 2,330)
100% of the declared value of consignment
RMB 20,000 – 200,000 (approx. EURO 2,330 - 23,300)
50% of the declared value of consignment but not less than RMB 20,000 (approx. EURO 2,330)
Over RMB 200K (approx. EURO 23,300)
RMB 100,000 (approx. EURO 11,650)
The value of the bond is calculated based on the declared value of the preliminary seized goods
• Option one: Paying bond in RMB into designated account of Local Customs;
Note: Sometimes, no bond is required! – The bond will be returned at the end of the procedure,
minus the warehouse and handling fees (paid by the right owner).
• Option two: Setting up General Bond with GAC (no need of paying bond on a case by case basis).
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Customs Bond payment in ex-officio detention procedure
• If the General Bond is established the PRC local Customs can proceed against counterfeit goods without the need of paying the individual security bond.
• Documents required by GAC for setting up General Bond: 9 Application Letter 9 Letter of Guarantee issued by a PRC licensed bank
(for each year) 9 Detail List of Disposal/Storage Fee of the previous
year, if any
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General Bond with GAC
�Public auction after removing the infringing labels �Donation to Charity Association (i.e. Red Cross) after
removing infringing labels �Destruction: right holders may be invited to attend
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Disposal of Infringing Goods
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Detention upon Application procedure
IPR owner finds
infringing goods to be
exported
Lodges application
with Customs and
pay bond (very detailed info required)
Customs seize the
goods and send Official
Notice
File civil lawsuit
within 20 working
days
Goods officially seized
Court decision
Warehouse fee
payment/ bond
refund/ Destruction
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Protection in Postal Channel & Luggage routes
China Customs is entitled to directly seize the infringing goods, without requesting the IPR owners to pay the bond
• If the seized counterfeits value reaches the criminal threshold, the Customs shall transfer the case to the PSB for criminal prosecution
• China Customs is working on enhancing the cooperation with the PSB to fight IPR infringements
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Cooperation between Customs and PSB
Trainings are necessary to improve front line Customs officials knowledge of foreign products/brands and inform on statistics of cross- border infringements.
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Importance of Training Customs front line officials
1. Company A has registered and recorded with Customs trademarks covering the core business (i.e. food)
2. Company B registers and records with Customs trademarks covering T-shirts
3. Company A produces in China some T-shirt as merchandising and ships them abroad
The Customs seize the products on the basis of trademark infringement of company B
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Case studies Remember : if another entity registers your IP Right in China and then records it with Customs, YOUR products can be stopped at Customs when imported/exported!
• Xiamen Customs seized infringing Clothing bearing “UNDER ARMOUR” mark with a total value of RMB 2.05 million (even if the Customs declaration stated different trademark)
• Xiamen Customs notified the Public Security Bureau (PSB), and the local PSB launched investigation and criminal prosecution into it.
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Case study
Cooperation between Customs and PSB enhance the deterrent effect of Customs Protection.
Take Away Messages 9 Customs protection of your registered intellectual property
rights is a core aspect of every successful IP protection strategy.
9 Register your rights in China and record them with GAC.
9 Train the Customs front line officials on the peculiarity of your
products.
9 Maintain good relationship with Customs officials by assisting
also in seizure with low quantity of goods.
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Q&A
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Name: Alessandra Chies
Firm: Ferrante Intellectual Property
Location: Beijing
Email: [email protected]
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Join our upcoming events!
Click here to access our Event Calendar.
Upcoming Training Events in China: 30 April, Beijing: Building your Business in China's Healthcare Industry
8 May, Beijing: China IPR SME Helpdesk Serious Game Official Launch
9 May, Shanghai: Sino-EU Bio Partnering Upcoming Training Events in Europe: 25 April, Brussels: How to Protect your Business and Innovations in China?
29 April, Liverpool: Introduction to IPR protection in China
29 April, Riga: How to Protect your IP While Doing Business in China
Thank you Both the China IPR SME Helpdesk and ASEAN IPR SME Helpdesk provide free, confidential, business-focused advice relating to China IPR to European Small and Medium Enterprises (SMEs).
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For more information please contact the Helpdesks: Room 900, Beijing Sunflower Tower No. 37 Maizidian Street Chaoyang District Beijing 100125, P.R. China Hotline number: +86 (10) 6462 0892
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