New Regulations Regarding Customs Enforcement of IPR

In an attempt to streamline the customs enforcement process regarding intellectual property rights, the General Administration of Customs passed several new regulations that aim to strike a balance between IPR holders and those who import and export goods.
Under old regulations, customs officials were allowed to ¡°dispose¡± of confiscated counterfeit goods by removing unlawfully affixed trademarks, and auctioning off the goods. These goods commonly reappeared in the market and thus caused monetary harm to the rights owner.
The new regulations now require customs officials to seek the opinion of the relevant IPR owners before it may dispose of any confiscated counterfeit goods. This regulation is a direct attempt to bring China up to the WTO TRIPS agreement standard, which specifically states that sized goods should be disposed of ¡°outside the channels of commerce in such manner as to avoid any harm caused to the right holder, or destroyed" and "the simple removal of the trade mark unlawfully affixed shall not be sufficient.¡±
While this move is undoubtedly a step in the right direction, it is important to note that the regulation requires customs officials to seek the ¡°opinion¡± rather than the ¡°consent¡± of the relevant IPR owner. It thus does not give IPR owners the right to demand the destruction of counterfeit goods rather than the auctioning off of such products.
Another salient feature of these new regulations is that IPR owners will now be able to seek settlements with the infringing party without undergoing a formal customs investigation. It is hoped that this will allow IPR owners to gain valuable information regarding the supply and distribution chains of such counterfeit items while also substantially reducing the resources required of the Customs Department to investigate each and every claim.
The new regulations also contained several smaller modifications such as changes to the notification protocol, the processing of renewal applications, and the cancellation of recordals. All of these modifications are designed to streamline and expedite the customs enforcement process.
Mr. Edward Lehman, managing director at LEHMAN, LEE & XU, said that these regulations ¡° Demonstrate China¡¯s commitment to bringing itself up to the global standard of intellectual property rights enforcements.¡± Mr. Lehman also expressed that he is ¡° excited to see how these new regulations will unfold in practice.¡±
LEHMAN, LEE & XU is the third largest corporate commercial law firm in China, established in 1992 by a group of Chinese lawyers devoted to developing excellence in the practice of law and to the founding of modern law practices in China, providing a full range of China IP services including prosecution, licensing and dispute resolution. LEHMAN, LEE & XU's IP lawyers have a wealth of experience in the IP law of China and in the international laws and conventions which govern the procurement and enforcement of IP worldwide. The Firm is recognized as a leading Law Firm providing the best and most diversified legal services and solutions to its clients. Today, LEHMAN, LEE & XU has extended its affiliate offices across China employing more than 250 licensed lawyers, patent and trademark attorneys and legal assistants.
To learn more about the Lehman, Lee & Xu, please visit to website: www.lehmanlaw.com


Alexander N. Pan
Lehman, Lee, and Xu



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