Urgent memo to the EU: don't let transit be a safe harbour

Abstract

Carl De Meyer is a Partner based in the Brussels office of Hoyng Monegier LLP. Carina Gommers is Senior Associate with the same firm and also an Affiliated Junior Researcher at K.U. Leuven. In Philips/Nokia, the ECJ held that goods coming from a non-member state, and declared to customs under a suspensive procedure, can be intercepted by customs when there are indications that the goods may be put on sale in the EU. In the subsequent proceedings on the merits, however, these goods cannot be classified as counterfeit or pirated goods merely on the basis of the fiction that the goods are to be considered as having been manufactured locally. The obvious downside for intellectual property owners is the extremely high burden of proof in the substantive proceedings. Where the mere existence of an indication that the goods may be put on the market in the EU will be enough for customs to suspend release of the goods, an order establishing and enjoining the infringement in the substantive proceedings will require evidence that the goods will effectively be put on the EU market. This requires evidence of an actual sale, an offer for sale or advertising addressed to a consumer in the EU. In most cases, the intellectual property owner will not have the information to meet this burden of proof. The only ones that have the relevant information are the parties interested in the transshipment. We therefore call upon the Commission to provide for a rebuttable presumption in the new Customs Regulation that goods detained by customs, will be assumed to be put on the EU market in violation of the intellectual property right and that the parties interested in the transshipment shall be allowed to rebut that presumption by providing conclusive evidence that the goods are legitimate and have a destination where the intellectual property right shall not be violated.