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Wednesday, 9 April 2014

Of bottles and customs: a sensible ruling from the CJEU

Today the Court of Justice of the European Union (CJEU) delivered its ruling in Case C‑583/12 Sintax [or, if you prefer, Syntax: the CJEU uses both spellings] Trading OÜ v Maksu- ja Tolliameti Põhja maksu- ja tollikeskus, a reference for a preliminary ruling from Estonia's Riigikohus. Advocate General Cruz Villalón delivered his Opinion on 28 January 2014 [noted by the IPKat here], and a ruling less than three months later is quite respectable.

Syntax imported into Estonia a quantity of bottles of bath products supplied by a Ukrainian company. When they were imported, Acerra told the Customs Authorities that those bottles infringed a patent that was registered in its name.  Acting on this information, the Customs Authorities suspended the release of those bottles for free circulation in order to carry out a further investigation: this revealed a strong similarity between the shape of the bottles imported and Acerra’s patent. Suspecting an infringement of an intellectual property right, the Customs Authorities seized the goods and requested an opinion from Acerra -- which confirmed those suspicions. Having decided that the bottles infringed an intellectual property right within the meaning of Regulation 1383/2003 [concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights] the Customs Authorities rejected the application by Syntax to obtain the release of the goods.

Syntax challenged the decision of the Customs Authorities before the Administrative Court, Tallinn, which found some procedural irregularities and ordered the release of those goods. This judgment was upheld on other grounds by the Tallinn Court of Appeal, which held that Article 10 of Regulation 1383/2003 did not authorise the customs authorities to give a decision as to the existence of an infringement of an intellectual property right. According to that court, in the absence of judicial proceedings to establish whether Acerra’s intellectual property right was infringed, the Customs Authorities could not detain the goods after the expiry of the fairly brief period prescribed to that effect by Article 13(1) of Regulation 1383/2003.


The customs administration appealed in cassation to the Riigikohus (the Estonian Supreme Court) which, unsure as to whether that interpretation was well founded since Estonian law actually authorised the Customs Authorities to conduct their own adversarial proceedings. on their own initiative, in order to give a decision on the merits as to the existence of an infringement of an intellectual property right, stayed the proceedings and referred the following questions to the Court of Justice for a preliminary ruling:
‘(1) May the “proceedings … to determine whether an intellectual property right has been infringed” referred to in Article 13(1) of Regulation 1383/2003 also be conducted within the customs department or must “the authority competent to decide on the case” dealt with in Chapter III of the regulation be separate from the customs?

(2) Recital 2 in the preamble to Regulation 1383/2003 mentions as one of the objectives of the regulation the protection of consumers, and according to recital 3 in the preamble a procedure should be set up to enable the customs authorities to enforce as effectively as possible the prohibition of the introduction into the Community customs territory of goods infringing an intellectual property right, without impeding the freedom of legitimate trade in accordance with recital 2 in the preamble to the regulation and recital 1 in the preamble to Implementing Regulation 1891/2004 concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights].

Is it compatible with those objectives if the measures laid down in Article 17 of Regulation 1383/2003 can be applied only if the right-holder initiates the procedure mentioned in Article 13(1) of the regulation for determination of an infringement of an intellectual property right, or must it also be possible, for the effective pursuit of those objectives, for the customs authorities to initiate the corresponding procedure?’
Today the CJEU, following the advice of the Advocate General, ruled as follows:
"Article 13(1) of Council Regulation ... 1383/2003 ... has to be interpreted in such a way that it does not exclude Member States from empowering customs authorities to conduct the proceedings mentioned in the provision, on condition that the said power is provided for explicitly in national law, the customs authorities act in a manner that ensures their independence and impartiality, the right to be heard is respected and the opportunity for judicial review is granted.

Article 13(1) ... has to be interpreted in such a way that it does not exclude Member States from providing for the possibility that the customs authorities also formally initiate the proceedings mentioned in the provision themselves".
This is good news for the Estonian Customs folk, who can now get on with their day jobs without worrying about the need for tedious court proceedings before determining that infringing goods are coming into the country. It may all be a bit too late for Acerra,
though.  Does anyone know what has happened to the bottles?

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