Explanatory Memorandum to COM(2011)285 - Customs enforcement of intellectual property rights - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2011)285 - Customs enforcement of intellectual property rights. |
|---|---|
| source | COM(2011)285  |
| date | 24-05-2011 |
The Commission’s Communication on a strategy for smart, sustainable growth, ‘Europe 2020’[1], underlined the importance of innovation for growth and jobs and Intellectual Property Rights (IPR) are fundamental to this key priority, ensuring full benefits from research, innovation and creative activities. IPR infringements and the resulting trade in infringing goods are of growing concern, particularly in a globalised economy. In addition to the economic consequences for industry, the infringing products may pose serious health and safety risks to consumers. In its Communication on a Single Market Act[2], the Commission therefore recalled that customs authorities should be able to provide greater protection for intellectual-property rights through revised legislation.
Council Regulation (EC) No 1383/2003 provides for customs action against goods suspected of infringing certain intellectual property rights and is an important element in the EU's strategy to protect and enforce intellectual property rights. In September 2008 the Council[3] invited the Commission and the Member States to review this Regulation and suggest and evaluate the improvements to the legal framework on action against products found to have infringed such rights.
The Commission developed a new customs action plan to combat IPR infringements for the years 2009-2012. The main elements of the Action Plan i, prepared by the Commission and endorsed by the Council, cover legislation, operational performance, cooperation with industry, international cooperation and awareness-raising. The review of the Regulation was incorporated into the plan and was carried out by the Commission, in close collaboration with the Member States through a working group created under the Customs 2013 Programme, which was composed by experts of the customs administrations of the Member States.
Certain instances of detentions by customs authorities of shipments of medicines in transit through the EU, which occurred at the end of 2008, gave rise to concerns among certain Members of the WTO, Members of the European Parliament, NGOs and the civil society. It was claimed that such measures could hamper legitimate trade in generic medicines, thus contradicting the EU commitment to facilitating access to medicines in the developing world, and eventually violating WTO rules. The incidents of detentions triggered WTO disputes against the EU by India and Brazil, which together with the concerns expressed during the relevant WTO consultations between India and Brazil and the EU, have shown that the relevant EU legislation for intellectual property enforcement by customs authorities could benefit from further clarification to increase legal certainty.
The proposal is in line with the Union’s longstanding policy and strategy on the protection of IPR. This policy has been reflected in several Communications from the Commission, such as Europe 2020 and the Communication on a Single Market Act[5]. Protection of intellectual property stimulates innovation and effective enforcement has a positive impact on employment, consumers and society as a whole.
The border enforcement of IPR by customs complements enforcement on the internal market, as well trade initiatives with third countries and in international fora. The proposal is an integral part of the strategic framework outlined in the new Communication from the Commission on a Single Market for Intellectual Property Rights of [ May 2011].
Contents
A public consultation was carried out to ensure that all stakeholders were given ample opportunity to contribute to the review of Regulation (EC) No 1383/2003. The response to the public consultation included 89 contributions from a wide range of stakeholders, including right-holders, providers of services related to international trade, such as forwarders and carriers, lawyers, academic institutions, NGOs, public authorities and citizens.
The main issues that attracted interest from the respondents were the scope of the Regulation in relation to the situations in which customs authorities can take action and the range of intellectual property rights covered by the Regulation, the simplified procedure in general and in relation to small consignments and the costs of storage and destruction of goods.
The impact assessment report identified and assessed policy options concerning the customs measures and procedures related to the border enforcement of intellectual property rights. The main areas covered were the scope for strengthening IPR enforcement at the border, addressing the administrative and economic burdens of enforcement on customs, right-holders and other stakeholders, and the need to ensure effectiveness and consistency with all relevant legal obligations.
The impact assessment report looked at three different options, if relevant with a number of sub-options. The first option provided for the so-called ‘baseline scenario’, where the Commission would take no action and the status quo was maintained. The second option provided for certain non-legislative measures, where the Commission would propose training initiatives and the development of guidelines and exchange of best practises. The third option was for the Commission to propose amendments to the existing legal framework. Under this option different sub-options could be available for each of the identified problems.
· Option 1 should be excluded if the Commission was to respond adequately to the Council’s request to review the legislation and to the concerns about the scope and implementation of the current legislation expressed by stakeholders during the consultation process.
· Option 2 would only partially address the identified problems. Guidelines and explanatory notes could help clarify applicable procedures or how to apply general principles of law. However, these non-legislative measures could not address some of the objectives of widening the scope of intellectual property rights or make procedures compulsory throughout the Union.
· Option 3 would give the maximum legal certainty that IP rights not covered by the present Regulation would be included, procedures would be harmonised and procedural clarifications would be given. Under this option, two sub-options were given. Sub-option 1 provided for the extension of the possible types of infringements to rights already covered by the current Regulation, for example, as regards goods involving any infringement of trade mark rights, not just counterfeiting. Sub-option 2 included sub-option 1 and extended the current scope of the Regulation in terms of IPR covered.
The impact assessment concluded that the best suitable solution would be to amend the Regulation to respond to all the problems identified and to ensure a balanced outcome for all categories of affected persons.
The commercial aspects of intellectual property are part of the framework of the common commercial policy. Article 207 of the Treaty on the Functioning of the European Union provides powers to adopt measures for implementing the common commercial policy. Therefore the legal basis for the proposal is Article 207 of the Treaty on the Functioning of the European Union.
The Regulation concerns the commercial aspects of intellectual property rights in that it deals with measures enabling customs to enforce intellectual property rights at the border on goods that are internationally traded. Article 3(1) of the Treaty on the Functioning of the European Union provides exclusive competence on the European Union in the area of common commercial policy.
The proposal will not have an impact on human resources and on the European Union budget and is therefore not accompanied by the financial statement foreseen under Article 28 of the Financial Regulation (Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities).
The review identified certain improvements to the legal framework that were considered necessary to strengthen the provisions concerning enforcement of intellectual property rights, whilst at the same time ensuring legal clarity of the provisions themselves. It is therefore proposed to replace Council Regulation (EC) No 1383/2003, with the attached draft new Regulation.
In order to strengthen enforcement, it is proposed to broaden the scope covered by Regulation (EC) No 1383/2003, by including trade names, topographies of semiconductor products and utility models. It is also proposed to widen the scope of the Regulation by including infringements resulting from parallel trade and devices to circumvent technological measures, as well as other infringements of rights already enforced by customs.
The Regulation would maintain the ability for customs to control for the purpose of enforcement of intellectual property rights, in all situations where the goods were under their supervision and the distinction between the procedural nature of the legislation and substantive law on intellectual property would be emphasised.
The Regulation would also introduce procedures enabling customs, under certain conditions, to have goods abandoned for destruction without having to undergo formal and costly legal proceedings. These would be differentiated according to the type of infringement. For counterfeit and pirated goods, the agreement of the owner to destroy the goods could be presumed if the destruction had not been explicitly opposed, whereas for other situations, the owner of the goods would have to agree explicitly to their destruction. In case no agreement is reached, the right-holder would have to initiate legal proceedings to establish the infringement, otherwise the goods would be released.
A specific procedure is also proposed for small consignments of suspected counterfeit and pirated goods covered by an application, which would allow for goods to be destroyed without the involvement of the right- holder.
Additional provisions are proposed to ensure the protection of the interests of legitimate traders from possible abuse of the customs enforcement procedures and to integrate the principles of the Charter of fundamental rights in the Regulation. To this end, the Regulation would clarify the timelines for detaining suspected goods, the conditions in which information about consignments would be passed on to right-holders by customs, the conditions for applying the procedure allowing for destruction of the goods under customs control for suspected infringements of intellectual property rights other than for counterfeiting and piracy, and the right of defence. In this way, the new regulation would become a more robust enforcement tool thereby enhancing the legitimacy of customs action.The issue of costs of storage and destruction of infringing goods has attracted attention from different stakeholders. The Regulation would continue to provide that storage and destruction costs directly incurred by customs be assumed by the right-holders requesting customs action, though this would not preclude them from taking legal action to recover such costs from the primary liable party. However, it is proposed to introduce an important exception for small consignments, for which storage and destruction costs would be assumed by customs.