Seizure and Customs Detention: how to navigate the process

Dreyfus May 16, 2023 0

Customs seizures of counterfeit goods increased significantly in 2022. While French customs intercepted 5.6 million counterfeit items in 2020, seizures increased to 11 million in 2022. On February 23, 2023, the Ministry of Public Accounts stated, “Counterfeiting no longer spares any sector of the economy1.”

Customs seizures are a crucial measure to protect industrial property rights against counterfeits. In addition to financial losses, counterfeit goods can damage a company’s brand image and reputation in the marketplace. Customs, therefore, play a crucial role in preventing the importation of counterfeit goods into their territory.

The customs detention procedure

A procedure with multiple implications

France is a pioneer in customs detention because it was the first EU Member State to classify imported counterfeit goods as illegal goods. Thus, the Longuet law2 codified this particular procedure into French law. According to the Regulation of 12 June 20133, the laws of the European Union also apply. However, items released for free circulation pursuant to the regime of the specific destination and items without commercial character contained in the personal luggage of travellers are not subject to detention.

This is a necessary procedure for strengthening the protection of one’s intellectual property right(s) by allowing customs officers to temporarily block goods suspected of infringing on them. During this detention, the rights holder can request that counterfeit goods be destroyed if certain conditions are met, or even file a legal action.

The prerequisite for filing an intervention request

This is a highly structured and regulated procedure. It begins with the rights holder (or licence beneficiaries under certain conditions) filing a request for customs intervention with the competent customs service in France or the European Union. This allows the market to be monitored and the applicant to be notified in the event of a counterfeit capture. This is a preventive and free (as of the July 29, 20224 decree) step that can be taken even if the applicant is unaware of any infringement of his or her right(s). The customs intervention request is valid for one year and can be renewed with a simple written request. It must include information on authentic goods and common counterfeits, as well as identification of rights and their holders.

On the one hand, the national intervention request allows customs officials to detain goods that have already crossed French borders and have been cleared throughout French territory. The European intervention request, on the other hand, allows customs authorities to detain third-party goods in customs prior to their introduction into European Union territory.

The effectiveness of the detention request stems from its submission to the appropriate customs services. This enables rights protection to be tailored to each vector of counterfeit introduction, such as targeting cells in ports and airports to control commercial freight, brigades to conduct roadside checks on people and vehicles, specialised services for postal checks and express freight, and even Cybercustoms, a service in charge of tracking fraud on the Internet.

The customs seizure procedure

Evaluation of the similarity between authenticity and suspected forgery

Customs officers do not have expertise, but it is their responsibility to identify products that appear to be counterfeit. The customs service that carried out the detention subsequently notifies the applicant. In order to confirm or refute the suspicion of counterfeiting and determine the subsequent course of action, this notification includes photos and the quantities detained. If this set matches, they then proceed to a customs seizure.

A procedure subject to defined deadlines

According to Article 3 of Regulation (EEC) of June 3, 19715, the customs seizure procedure allows goods suspected of counterfeiting to be detained for a maximum of 10 days (3 days for perishable goods), which can be extended by 10 days on a reasoned request. This time frame allows for the goods to be inspected.

Procedure for Simplified Extrajudicial Destruction

The allotted time also allows for the applicant to request a simplified destruction procedure. If applicable, three conditions must be met. First, the applicant must confirm in writing that he agrees to the destruction of the goods under his control. Second, he must be able to ensure the authenticity of the goods by providing detailed expertise. Finally, the presumed counterfeiter (also known as the “holder” of the counterfeit goods) must confirm in writing to customs services within 10 working days of being notified of the detention that he wishes to express himself regarding the destruction of the goods. If no action is taken, it will be assumed that he agrees to this destruction. If he objects, the holder is notified and given an additional 10 working days to take legal action or take probative measures for the same purpose.

The potential legal ramifications of the customs seizure

When a counterfeit is discovered but the simplified destruction procedure is not used, the rights holder has the following options:
Appeal to the territorially competent court to obtain authorization for conservatory measures,
Justify the filing of a complaint with the Public Prosecutor,
Take legal action in criminal or civil court.

For this purpose, the rights holder may request that the customs professional secrecy be partially lifted in order to obtain additional information (names and addresses of the recipient, sender, declarant, and holder of the goods, customs regime, origin of the goods, and destination), provided that this information is used for the purposes specified in Article 21 of the Regulation of June 12, 20136.

What happens in case of unjustified detention?
In the event of an unjustified or abusive detention, the rights holder may be responsible for paying all costs incurred by both customs and the owner of the goods. Furthermore, customs cannot order the rights holder to compensate the owner of the goods if the detention is unjustified. However, whether the detention is justified or not, they can always ask the rights holder to cover the storage costs. In most cases, they do not. Such compensation could only be made at the request of the owner of the goods, through a counterclaim, or through a separate legal procedure. In this case, the owner may seek compensation for his entire loss.

Transit policy

This regime is a World Customs Organisation measure that allows goods to cross customs borders without being subject to customs duties or other taxes. On the one hand, internal transit refers to the movement of goods within the community area that are intended to be marketed in the transit country. As a result, customs officers can seize the goods and hold them for a set period of time while waiting for the rights holder’s opinion. External transit, on the other hand, refers to the movement of goods originating in and destined for third countries to the European Union where they will be marketed from one point on the community territory to another.

This customs regime creates a legal fiction in which the goods in question do not exist in the community territory through which they transit. Despite this “non-existence” on the community territory, it seems necessary, as in the case of community transit, to allow customs authorities to use this detention measure to ensure that goods suspected of infringing intellectual property rights do not fraudulently use the customs regimes considered. However, the CJEU7 has applied the fiction of customs law.

This decision is devastating because it establishes the principle that a third-party good in transit, originating in and destined for a third country, can only be detained for suspicion of counterfeiting if it is intended for sale on the European Union market. Customs officers can thus clearly detain counterfeit goods only if the rights holder provides proof of concrete indications of future placement on the Union market.

Dreyfus & Associates Law Firm: intermediary between rights holders and customs

The landscape of industrial property rights is shifting as e-commerce expands and counterfeiting becomes more sophisticated. The owners of intellectual property must now incorporate customs monitoring into their already extensive brand monitoring efforts. In this sense, the request for customs intervention is a complex operation that establishes and conditions the effectiveness of the seizure measure, which is its logical and technical continuation.

The law firm Dreyfus & Associates offers its expertise to its clients, proposing assistance in exchanges with competent customs services.
We have a network of agents throughout the community area to monitor incoming and outgoing goods movements.

We also have a specialised department at the disposal of its clients for the surveillance of industrial property titles, which can make the request for intervention to customs on behalf of the rights holder.

Finally, Dreyfus & Associates allows its clients to participate in customs officer training to improve the identification of genuine articles and, by extension, counterfeit goods.

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