1 February 2013Jurisdiction reportsJoy Atacador

New look enforcement mechanisms unveiled

Fashion brands will welcome significant reforms to Australia’s trademark and copyright enforcement mechanisms under the Intellectual Property Laws (Amendment) Raising the Bar Act 2012, which will come into force on April 15, 2013.

Australia’s Notice of Objection Scheme provisions enable Customs to seize imported goods that infringe registered trademarks or copyright before entering the market.

Customs will be allowed to disclose more information to trademark and copyright owners who have lodged a Notice of Objection with Customs (‘objectors’) to assist with identifying and locating the Australian importer as well as the exporter/foreign supplier of infringing goods. The new provisions will also permit Customs to allow objectors to inspect or obtain a sample of seized goods to facilitate counterfeit determination.

The revamped scheme will move the onus to the importer of seized goods to complete a claim form for release of seized goods upon provision of contact information, otherwise the goods will be treated as forfeited.

This will relieve objectors from the currently onerous requirement to commence legal proceedings within 10 working days of a seizure of infringing goods in order to prevent their release to the importer. In many cases, the importer cannot be identified without further investigation and, particularly in the case of small-scale seizures, the expense of court action is simply not justified.

The owner of copyright material (such as a print design, pattern, logo, packaging artwork, catalogue, jewellery or bags which are works of artistic craftsmanship) can lodge a Notice of Objection with Australian Customs. A Notice of Objection can also be lodged by the registered owner of a registered trademark. Multiple trademarks can be included in a single notice.

“IN MANY CASES, THE IMPORTER CANNOT BE IDENTIFIED WITHOUT FURTHER INVESTIGATION AND, PARTICULARLY IN THE CASE OF SMALL-SCALE SEIZURES, THE EXPENSE OF COURT ACTION IS SIMPLY NOT JUSTIFIED.”

The changes to the Customs seizure scheme should reduce the overall costs to copyright and registered trademark owners who will be able more readily to contact counterfeiters and direct enforcement resources to cases where there is a serious risk of counterfeit goods being released to an importer and ultimately into the marketplace. In civil trademark infringement suits, the courts will be allowed to award punitive additional damages on top of an award for either compensatory damages or an account of the infringer’s profits.

The maximum penalty for trademark counterfeiting offences will be increased from two to five years in jail and heftier fines may be imposed for serious offences. Summary offences will be introduced with lower fault elements.

Trademark owners will be able to have their matters heard in the Federal Magistrates Court, soon to be renamed the Federal Circuit Court of Australia. This lower level court was established in 2000 to provide a simple, cheaper and quicker alternative to litigating in the superior Federal Court of Australia.

The latest on parallel imports

In an appeal determined late in 2012 from a case commenced by the owner of the Lonsdale brand in Australia against Australian sports retailer, Paul’s Warehouse, the Full Court of the Federal Court of Australia affirmed that it is possible to stop the sale of parallel imported goods in Australia.

Where goods are trademarked under a limited licence given by an overseas trademark owner to manufacture and distribute branded products for a particular territory, dealing in those goods in Australia may still infringe the Australian registrations for the same trademarks held in the name of a different entity. This may be the case even if the Australian registered owner is a related entity of the overseas trademark owner.

The registered owner in Australia may be different from the owner of the same trademark in other jurisdictions and the Australian Trade Marks Act provides a defence to trademark infringement where it can be shown that the Australian registered owner consented to the application of the trademark to the goods in question.

Carefully crafting manufacturing and distribution licence agreements to contain clear territorial restrictions on the countries in which trademarked goods may be sold will make it tougher for parallel importers to compete legitimately with a brand owner’s authorised Australian distribution channels.

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