Tag: China Customs

According to Chinese laws, China Customs can protect China registered trademarks, patents and copyrights by monitoring and investigating on goods passing through the China border.

The Customs can detain the goods which they suspect to be infringing other’s IP rights, and may forfeit the goods or impose administrative penalties on the consignor or consignee of the infringing goods.

Where the Customs is not sure whether the IP infringement can be established, they may ask the IP owner to bring the case to the court and continue to detain the goods at the request of the court.

Statistics published by China Customs indicates that, protection provided by China Customs on IP rights are quite strong. Below is a table showing the quantities of goods detained on suspicion of IP infringement from Year 2012 to 2014.

Detained goods	Year 2012	Year 2013	Year 2014
Quantity (in batches)	15,690	20,464	23,860
Quantity (in pieces)	93,117,335	75,945,594	91,965,548

Statistics sourced from Annual Report published by China Customs for Year 2012, 2013 and 2014.

Further review on the details of the IP protection of China Customs for the recent three years shows the following characteristics:

(1) Most of China Customs actions are related to trademark infringement

From 2012 to 2014, more than 90% of the detained goods were relevant to trademark infringement.

Details on detainment of goods relating to each type of IP rights infringement are set out in the table below.

IP right	Detained goods	Year 2012	Year 2013	Year 2014
Trademark	Quantity (in pieces)	88,210,686	74,808,04	89,075,040
	Percentage against all goods detained	94.73%	98.5%	96.86%
Patent	Quantity (in pieces)	4,557,264	532,315	1,786,551
	Percentage against all goods detained	0.38%	0.8%	1.94%
Copyright	Quantity (in pieces)	349,385	604,788	1,100,857
	Percentage against all goods detained	4.89%	0.8%	1.2%

Statistics sourced from Annual Report published by China Customs for Year 2012, 2013 and 2014.

The reason behind probably is this: it would be easier for the customs officials to determine whether the trademark infringement can be established, compared with the patent infringement and the copyright infringement.

For patent infringement and copyright infringement, the customs officials usually requests the IP owner to submit it to the court for a judgement.

(2) Most investigations taken by China Customs were initiated by ex officio.

From 2012 to 2014, more than 99% of the investigations were initiated by ex officio.

How Initiated	Investigation taken by China Customs	Year 2012	Year 2013	Year 2014
By ex officio	Quantity (in times)	15,646	20,426	23,817
	Percentage against all investigations	99.72%	99.8%	99.82%
By application	Quantity (in times)	70	38	43
	Percentage against all investigations	0.45%	0.2%	0.18%

Statistics sourced from Annual Report published by China Customs for Year 2012, 2013 and 2014.

In practice, it is very difficult for the IP owner to get information about the infringing goods and the consignor or consignee of the infringing goods. Without such information, they cannot get the China Customs to initiate the investigations.

That is why the recordal of the IP rights at the China Customs is very important. After they are recorded at China Customs, it will monitor the goods imported or exported, and can start investigation on the possible infringing goods by ex officio.

(3) Most of IP right infringements occurred in the export process.

From 2012 to 2014, more than 95% of the infringement activities identified by China Customs occurred in export process, and more than 99% of detained goods were for exportation.

Import or export	Identified infringement/Detained Goods	Year 2012	Year 2013	Year 2014
Import	Quantity (in times)	690	679	842
	Percentage against all identified infringement	4.40%	3.3%	3.53%
Export	Quantity (in times)	15,000	19,787	23,019
	Percentage against all identified infringement	95.60%	96.7%	96.48%
Import	Quantity (in pieces)	211,487	452,648	439,933
	Percentage against all identified infringement	0.23%	0.6%	0.48%
Export	Quantity (in pieces)	92,905,848	75,492,946	91,525,615
	Percentage against all identified infringement	99.77%	99.4%	99.52%

Statistics sourced from Annual Report published by China Customs for Year 2012, 2013 and 2014.

This means that for the foreign companies which use China as the production base, it is very important for them to register their IP rights in China even though they are not selling products in China.

Otherwise, if their IP rights were registered by others, their IP rights could be recorded at China Customs in others’ names, which can effectively interfere the export of the products manufactured in China.