By Arpit Kalra and Kanishk Agarwal
With the advent of rapid technological advancements and open market access worldwide, both developing and developed countries have gained in some way or the other. However, due to such rapid advancement in technology and unregulated market forces, there has been a staple increase in the grey-market involved in bringing fake, illegal and counterfeit goods to the market, the most affected country is India among other Asia-pacific countries. Currently, Indian economy is significantly hit as India is fighting its battle with the everyday increasing IP infringement issues.
In order to curb such illegal entry of the fake, illegal and counterfeit goods in the Indian market and to reduce expansion of grey-market, the Government of India has taken some considerable steps. One major step for the Customs Department of India was to bring in force the Customs Recordal system in furtherance of its aim to forestall the cross-border movement of counterfeit or infringing goods.
Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007
The IP owners in India can take steps to record their intellectual property with the Customs Authority of India for the purposes of monitoring and confiscation. Such recordal can be done under the Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007 alongwith Customs Act, 1962 which can act as a preventive measure on part of brand owners wherein infringing and counterfeit goods can be detected and disposed off at the border itself.
The aim of recording intellectual property rights with the Customs Offices is to prevent trade in counterfeit or infringing goods. According to Rule 2(a) of the IPR (Imported Goods) Enforcement Rules, 2007, “infringing goods” means any goods which are made, reproduced, put into circulation or used in breach of the intellectual property laws and without the consent of the Right Holder or any authorized person.
In order to stop the import of counterfeit / low quality products in India, an application for recordal of custom is required to be filed with Customs Authority of India so that such products are seized at the customs port itself. To record an IP right with the Customs, a Right Holder must submit an application electronically along with the necessary documents and information and must register on the Indian Customs IPR Recordation Portal www.ipr.icegate.gov.in.1 A Unique Temporary Registration Number (UTRN) is then generated, which along with a physical copy of the documents must be submitted to the IPR cell of the Custom House. Within 30 days a Unique Permanent Registration Number (UPRN) will be issued which serves as conclusive proof of recordation of the intellectual property right.
Please note that an application for recordal of custom can only be filed for the registered intellectual property right and a separate request is required to be filed for recordal of each intellectual property right with the Customs Authority. Further prima facie, the Customs Authority safeguards the Intellectual Property only in respect of the intellectual property right and its specification which are registered with the Customs Authority. It is pertinent to mention that one recordal of the intellectual property right with Customs Office will suffice for all the ports in India.
Once the intellectual property right is recorded with the registered with the Customs Office, they diligently keep a track on relevant goods being imported into India bearing the registered intellectual property right. If the Customs Office finds infringing goods in any consignment, they have the right to detain the same and inform the Right Holder and the importer2.
In case of any consignment seized at the Custom, a Notice of Suspension of Goods will be issued from the Dy. Commissioner of Customs that a consignment has been detained for suspicion that they might have infringing goods with the value of the infringing goods, product ceased and importer details.
Procedure for recordal of Custom Application
The procedure for recordal of intellectual property right with the Customs Authority is as under :
- An online application for recordal of intellectual property right with the Customs Authority is filed on the website of Customs.
- A Unique Temporary Registration Number (UTRN) is generated on filing the online application
- Hard copies of the documents uploaded in online application are sent along with the UTRN to the Customs Office.
- After approval of the application for recordation by the Commissioner of Customs, the UTRN will be converted to UPRN (Unique Permanent Registration Number) and the said UPRN will be issued which confirms the recordation.
The period of validity of the custom registration is five (5) years and the same is required to be re-filed after the expiry, in order to renew the same.
The Customs Department of India has taken adequate measures to stop importation and entry of counterfeit / infringing goods in the Indian market, however, not many measures have been taken for exportation of such counterfeit / infringing goods to other countries from India where the third parties or sellers involved are local manufacturers or distributors producing counterfeit / low quality products in India and selling the same in grey-market across the globe.
One another measure that needs to be brought under the law guidance is parallel imports, where the branded goods are not counterfeit / infringing goods as they have been manufactured by authorized dealers of the brand, but the trade channels are unauthorized. It is therefore, an urgent need of the hour to address and take steps to combat the problem of counterfeit / infringing products moving in the grey-market.
 Section 111 (d) of the Customs Act, 1962