HM Revenue & Customs has recently revised its procedures with immediate effect that stop pirated or counterfeit goods, in ways that increase the burden on trade mark and copyright rights holders. HMRC takes action when it believes that products which infringe a right holder's intellectual property rights are passing through UK borders. Until the end of June, its process was that it would detain potentially counterfeit goods and inform the right holder of that. The right holder would then have the right to examine the goods to see if they were infringing. If the right holder believed them to be infringing, it would submit a witness statement to HMRC, claiming that the goods were counterfeit. Following receipt of the right holder's statement, the owner of the goods needed to complain to court if it disputed the statement. The case would then be heard in front of a local Magistrates' Court to make a ruling. If the Magistrates' Court agreed with HMRC or if the owner of the goods did not dispute the finding, HMRC would destroy the allegedly infringing goods in its possession.
However, now, the burden of proof has been reversed. Instead of the goods owner having to prove it was authorised to supply its goods, it is the right holder who has to prove that the goods were unauthorised. HMRC will no longer seize items based on a witness statement from the right holder. Instead, HMRC will detain the allegedly infringing products pending a court ruling. The right holder has a very short window in which to go to court. The right holder must instigate court proceedings within 10 working days of receipt of the notification provided by HMRC (three working days for perishable goods). Alternatively, the right holder and the goods owner may come to an agreement for what to do within the same period. That 10 working day period may be extended up to a maximum of 10 further working days, ie 20 working days in total. Until resolution of the court proceedings or agreement has been reached, HMRC will continue to hold the goods under detention. If legal action has not been taken within 20 working days, though, or the right holder does not obtain a successful court judgment or it has not obtained an agreement to abandon the goods from the goods owner, then the goods would be released.
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