Intellectual property (IP) enforcement at the border is a critical aspect of global trade, helping prevent the import and export of infringing goods. As one of the world's largest trading nations, China has developed a comprehensive customs enforcement system.
This article provides an overview for U.S. and European readers of the two principal enforcement mechanisms available through the General Administrations of Customs (GAC) of China: (1) Protection Ex Officio and (2) Protection by Request.
Protection Ex Officio: Proactive Enforcement by Customs
Under the Protection Ex Officio system, Chinese Customs authorities proactively monitor imports and exports for potential IP infringement without requiring a petition from the rights holder. This system allows Customs officials to intercept and investigate shipments that appear to infringe trademarks, patents, or copyrights1.
To enable Protection Ex Officio, IP rights holders must register their intellectual property—such as trademarks and patents—with the General Administration of Customs (GAC). Once registered, Customs officers can intercept and investigate shipments that appear to infringe those rights.
When Customs identifies goods suspected of infringement, they suspend the release of goods and promptly notify the rights holder. The rights holder is then afforded a three-business-day window to file a formal application with a cash bond, which is capped at RMB 100,000 (approximately USD 14,000), regardless of the total value of the detained goods. The rights holder may also apply for a general bond with a defined validity period, for trademark rights.2
Following the submission, Customs conducts a thorough investigation within 30 business days of detention of the goods. If infringement is confirmed, Customs may confiscate the infringing goods and impose penalties. If no infringement is found, the goods are released.
When Customs cannot determine whether the goods infringe IP rights, the rights holder is notified and may pursue a court order to cease infringement or apply for property preservation. In these cases, the detention period may be extended up to 50 business days while awaiting the court's decision.
For suspected patent infringement, if Customs remains unable to determine infringement regarding patent rights and the consignee or consignor submits a counter bond equal to the value of the detained goods, they may request the goods' release.3
If the violation constitutes a criminal offense, the matter is referred to law enforcement authorities. Confiscated goods are handled by relevant legal provisions, and any associated fees are deducted before the bond is returned to the rights holder.4
Protection by Request: Petition-Based Enforcement
The Protection by Request program allows rights holders to initiate enforcement directly, even if their IP has not been registered with the GAC.
To utilize this program, the petitioner must provide a bond that matches the value of the suspected infringing goods—without a cap. Upon receiving the petition, Customs detains the goods and notifies both the rights holder and the consignee or consignor. If the consignee or consignor provides a counter bond, they may request the release of the detained goods suspected of infringing patent rights.5
Unlike the Ex Officio process, Customs will not conduct a substantive investigation into infringement and will rely on the right holder to seek relief through the Court. To continue enforcement, the rights holder must seek the Court's order for cease of infringement or property preservation within 20 working days. If the Court notifies Customs to enforce the infringement ruling on the cease of infringement or property preservation, Customs will comply accordingly.6 Conversely, if no Court's order is issued, the detained goods shall be released. As with the Protection Ex Officio program, relevant fees are settled before the bond is refunded to the petitioner.7
Key Takeaways for Foreign Stakeholders
China's customs IP enforcement mechanisms offer robust options for rights holders seeking to protect their interests in the Chinese market. The Protection Ex Officio program provides proactive border enforcement for registered IP, while the Protection by Request program allows for targeted action even without prior registration. Both programs require the provision of bonds and involve strict notification and procedural timelines.
Foreign companies engaged in trade with China should carefully consider these procedures when developing their IP protection strategies. Registering IP with Chinese Customs and understanding the petition process can be vital steps in safeguarding intellectual property from infringement at the border.
Footnotes
1. See, General Administration of Customs of the People's Republic of China at http://online.customs.gov.cn/treeGuide/?taskId=002029002000
2. See, Article 23 of the Implementation Measures of the Regulations https://www.gov.cn/zhengce/2018-05/29/content_5723336.htm
3. See Article 27-29 of the Implementation Measures of the Regulations, https://www.gov.cn/zhengce/2018-05/29/content_5723336.htm.
4. See Article 32 - 36 of the Implementation Measures of the Regulations, https://www.gov.cn/zhengce/2018-05/29/content_5723336.htm.
5. See Article 19 of the Regulations, http://gdfs.customs.gov.cn/customs/302249/302266/302267/357072/index.html
6. See, Article 18 of the Implementation Measures of the Regulations, https://www.gov.cn/zhengce/2018-05/29/content_5723336.htm.
7. Id.
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.
