The Trade Marks (International Treaties and Enforcement) Amendment Bill (the Bill) was introduced into Parliament on 8 September 2008. Along with amending the Trade Marks Act 2002 to allow New Zealand to join several international trade mark treaties, one of the primary purposes of the Bill is to add provisions to both the Trade Marks Act and the Copyright Act 1994 in an attempt to combat the growing problem of counterfeits.
Enforcement Role for NEU and Customs
The Bill provides for new investigative and prosecution powers for both the National Enforcement Unit of the Ministry of Economic Development (the NEU) and the New Zealand Customs Service to enable them to play an active role in enforcing the criminal offence provisions related to counterfeit goods and pirated works under the Trade Marks Act and the Copyright Act. Enforcement of these provisions currently rests mainly with the New Zealand Police but, as identified in the explanatory note to the Bill, a lack of resources and expertise within the Police has prevented them prioritising enforcement of the criminal provisions for counterfeiting.
While the balance between the respective roles of the NEU and Customs is yet to be determined, the focus for Customs will naturally be on enforcement at the boarder while the NEU will focus on post-border enforcement. It is hoped that empowering Customs to take prosecutions will be an effective way of helping to manage the number of counterfeit and pirated goods being imported. While Customs does not have the same expertise as the right holders themselves when it comes to identifying counterfeits, Customs will often be better placed to identify problem importers. While a right holder will be aware that “X” number of counterfeit goods bearing its marks or designs have been detained by Customs, it will not know if this is the whole shipment or just a small part of a larger shipment that also contains goods that infringe the rights of 10 other right holders. The right holder is also unlikely to be aware whether the same importer has attempted to import counterfeit goods that infringe the rights of different right holders on previous occasions. It is hoped that Customs will be able to identify and prosecute some of these repeat and/or large scale importers.
New Powers The new powers granted to the NEU include the right to:
- apply for, be granted and execute search warrants;
- use information from other government agencies (such as Customs and the Police); and
- undertake (in limited circumstances) non-search warranted search and seizures.
The new powers granted to (Customs) include:
- investigative powers related to goods under Customs’ control (including the right to seize goods that it has reasonable grounds to believe are relevant to an investigation of certain offences under the Trade Marks Act or Copyright Act, and the right to require any person involved in the importation of goods under investigation to supply documents relating to the goods or to appear and be interviewed about the goods).
- the power to apply for, be granted and execute search warrants; and
- the power to seize and retain for the purposes of investigation or prosecution, goods in Customs’ control or specified in a warrant.
In addition it will be an offence punishable by imprisonment for up to 6 months or a fine of up to $10,000 for an individual, or a fine of up to $50,000 for a body corporate, to deliberately withhold information legitimately requested by Customs or to refuse to be interviewed.
Cost to Right Holders
While there is likely to be some indirect costs to right holders resulting from the need to support the enforcement activity of the MED and Customs by providing expert evidence and collecting and sharing information to assist in identify offenders, no direct business compliance costs for right holders are anticipated.
It should be noted that the proposed amendments in the Bill are by no means intended to remove the need for right holder’s to continue to enforce their rights in relation to counterfeit goods available on the market or detained by Customs at the border. However, it will hopefully assist them in managing the growing problem with counterfeit goods and pirated works by providing those Government bodies best placed to identify and prosecute repeat infringers with the tools to do so.
Timing
The recent General Election and resulting change of Government means that the timing of the first reading for the Bill is currently uncertain but unlikely to be until the second half of 2009 at the earliest.