The more valuable your intellectual property, the more likely there will people seeking to import counterfeit goods or grey imports. The rise of ecommerce has made buying and selling such products much easier. The good news is that by exercising your intellectual property rights and engaging with the Australian Border Force you have effective options to protect your brand.
Unauthorised imports can breach intellectual property rights – counterfeit goods
In many cases, importing goods bearing trademarks or containing copyright material without the consent of the owner of those rights, infringes those intellectual property rights.
In the case of non-genuine (or counterfeit) products, there is usually a good basis to prevent importation by relying on trade mark rights if the counterfeit product bears a similar trade mark. There are often similar rights in respect of copyright or an Australian patent or design registration. Where there are counterfeit goods, the first step is often to have a lawyer demand that the imports cease, the counterfeit goods be destroyed, and damages be paid.
Grey imports – It may come down to the terms of the manufacturing agreement
The position is a little different where the imported products are genuine products, but their import is unauthorised (grey or parallel imports). Because these goods are usually made with the consent of the intellectual property rights holder, their import may not infringe intellectual property rights.
Often it comes down to the terms of the manufacturing agreement. Where the overseas manufacturer has permission to use the trademark, but there is an express restriction providing that the goods cannot be exported to Australia, a Court may hold that the importation of goods into Australia does in fact infringe intellectual property rights. This is because the IP rights holder did not consent to the application of the trademark to goods to be sold in the Australian market.
It is therefore important to ensure that manufacturing and distribution agreements qualify the consent to use the IP as much as is practically possible.
There are also circumstances in which a copyright owner can prevent the importation and sale in Australia of products which are protected by copyright and which were lawfully made and sold outside Australia by the copyright owner. However, there are quite a few exceptions to this where importation is permitted, including the importation of lawfully made books, electronic books, music, electronic music, computer programs, and accessories to imported articles such as product manuals, packaging and containers.
What practical steps can be taken?
A manufacturer can take practical steps to restrict the importation of genuine products. One method is to review imported goods and alert the relevant government agency if the packaging of the product does not conform with Australian standards.
Relationships with authorised
Other practical methods include dealing only with overseas distributors which agree not to import the products into Australia, and by closely monitoring the foreign markets in which products supplied to authorised distributors are ultimately sold. However, this can be practically difficult to control if there are many authorised distributors or if the products are only imported into Australia by an unknown third party after re-sale by an authorised distributor.
Use the Australian Border Force
The Australian Border Force (ABF) can seize unauthorised imports where a notice of objection is lodged in relation to your intellectual property. The notice of objection is the document that gives the ABF the right to seize the offending goods.
Once the goods are seized, both the importer and objector will be notified. The importer can make a claim for release of the goods. If a claim is made, the objector has 10 business days to commence legal proceedings in relation to the goods. The matter will then follow the usual course regarding breaches of intellectual property with one exception – the goods were never released into the Australian economy.
What's the catch? - It does seem too good to be true, lodge a document and the ABF will protect your intellectual property. The catch is relatively minor – in lodging the objection you must provide an undertaking to pay the ABF's costs of seizing, storing and disposing of the goods. However, you can expect the ABF to provide a quote for these costs before they are incurred.
How to make the most of this protection - When lodging the notice of objection you can nominate authorised importers. Be sure to keep this up to date to prevent the ABF seizing the wrong goods.
Don't stop at lodging the notice of objection - Inform the ABF on how to detect unauthorised imports. Inform the ABF of the following:
- Any known exporters or importers of authorised goods;
- The country of origin of the official goods;
- The likely country of origin of unauthorised goods.
Also remember that the notices need to be renewed every four years and be sure the ABF have up to date details of your IP lawyer.
As an owner of valuable intellectual property, it is often the case that you are trying to stop the damage once illegal imports have been identified. The notice of objection process provides you with a practical way to stop unauthorised imports in the first place.
Ultimately, the steps you take depend on how important your IP is to you. If a strong brand is important to your business, you should protect it in the same way as if someone was stealing your physical assets. This will involve a mixture of practical steps and enforcing legal rights.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.