The Netherlands: fake fragrances and garments seized in a number of warehouses
On 21st of November, SNB-REACT and the Police - major crime division raided several warehouses in the South of the Netherlands. Two suspects were arrested. They supplied several shops at the notorious Black Market in Beverwijk and some internet sites.

Approximately 2.000 fragrances and more than 10.000 garments were seized. The investigation is still ongoing and more arrests can be expected.

SNB-REACT is particularly happy with the fact that finally suppliers of fake fragrances were disclosed. Last year, we have seen a sharp increase in cases against retailers of fake fragrances although we were unable to detect suppliers.



Italy: Significant matters in Italy
Rome: The Fiscal Police of Rome has undertaken two operations in June against companies owned by Chinese people which have resulted in the seizure of 15.581 Harley-Davidson t-shirts and 6.312 Harley-Davidson scarves. This is the biggest seizure in Europe ever taken of Harley Davidson products.  In November another big operation has been carried out against a warehouse owned by Chinese people and 15.581 jackets and t-shirts bearing the trademark Harley-Davidson have been seized.

Savona: In April, the Savona Fiscal Police has carried out two operations against companies producing stickers of different trademarks without authorizations. They seized 50.000 stickers and among others they found De Puta Madre, Honda, Harley-Davidson, Yamaha, O’Neill, Reebok, Rolling Stones.

Varazze: In October, another big operation in cooperation with Guardia di Finanza of Varazze was carried out. They made three seizures against companies producing stickers and key-holders. They seized 950.000 products bearing different trademarks and among these they found Ford, Honda, Yamaha, Reebok, Rolling Stones, De Puta Madre.

Pisa: In June, the Pisa Fiscal Police has carried out a big operation against Chinese people. In a warehouse near Pisa they seized 100.000 products (toys, stationary, etc.). Among these they found Spiderman (216 toys and 290 games), Barbie (29 watches and 920 dolls) and Pucca (1.100 mobile cases and 2.178 wallets).

Ponte Chiasso: At the beginning of October, following a notification made by the French Customs, the Customs in Ponte Chiasso detained a truck loaded with 454 boxes containing jeans and jackets bearing the indication “ICE-DIOR”. The same jackets have been stopped and seized by French customs a few days earlier. An expertise was filed and 26.400 jeans and 2.300 jackets were seized.


Portugal: Important seizures during 2006
In August this year, the rock band Rolling Stones was on tour and had some concerts in Portugal. Musidor B.V., licensed for merchandising products of Rolling Stones, contacted SNB-REACT and asked for our cooperation to raid the surrounding areas of the concert to avoid the wholesale of counterfeited products of Rolling Stones. A joint action with Brigada Fiscal of Oporto and the local police resulted in the seizure of around 2.000 goods of Rolling Stones and 24 defendants were identified. This seizure reflected the collaboration and teamwork between SNB-REACT, the brand owners of Rolling Stones and Brigada Fiscal.

After several months of investigation, a joint action with BF Sines, October last, turned out to be a major success. In fact, a Chinese warehouse, known as an important retailer of sport shoes, was raided and 11.989 pairs of ASICS shoes were seized. The case will now follow the judicial steps and the defendant will be judged in a court of law.

In early November, a huge operation took place in Lisbon. This was a joint action with Brigada Fiscal of Lisbon to one of the biggest suppliers of counterfeited perfumes to retailers in Lisbon area. After a long time of investigation, the huge warehouse where the goods were stored was finally found and were seized around 150.000 counterfeited perfumes of several brands. The owners of the company “ANTE – Comércio Internacional Lda.” are Chinese and they are known to import counterfeited goods from China. We had a case with this company in 2004 and in The Netherlands, also in November, were seized 960 counterfeited perfumes of Fendi in Rotterdam Customs coming to this company in Portugal. This information was pasted by our office in Amsterdam and we settled successfully an agreement for the destruction of the goods based on article 11 of the EC Regulation 1383/2003.


Lithuania: Considerable perfume case
Lithuanian Customs have suspended a shipment of infringing Lancôme and Chanel perfumes. Were seized around 4.000 look-alikes. The goods were coming from Ukraine and destined to a private individual in Lithuania. After 10 days of suspension, the Lithuanian Customs have granted our request to have these goods destroyed under the simplified procedure. However, it appeared that there were no Lithuanian companies able to destroy perfumes in accordance with the environmental and safety requirements and therefore the goods only could be properly destroyed abroad. After several discussions, Customs issued a positive decision allowing the submission of the goods to a specialised waste-utilisation and recycling company in Germany, as long as the goods could be traceable.

SNB-REACT's Partners network is paying off!
SNB-REACT manages cases not only by its own offices, but also with its partners all over Europe. The customs cases from the partners based on EU Community Applications is increasing. Some few examples:

Fake memory cards seized in France and Poland. SNB-REACT filed a community customs application for Kingston Technology (producer of famous memory cards). French Customs have reported a seizure at Roissy-Charles de Gaulle airport. The goods were identified as being counterfeit and SNB-REACT's partner Contratak filed a customs application and subsequently the release of the goods was suspended. Similar cards were also found by the Polish customs in September this year. The Polish partner Bartosz Zablocki successfully handled this case.

In Sweden, fake Jack Daniels shirts were confiscated. Swedish customs in Goteborg reported our Amsterdam office a seizure of 80 sweatshirts. The items were identified as being counterfeit and our Swedish partner Peter Von Heidenstam of Gozzo is handling the case now and the release of the goods has been suspended.

Emergency letter to DG Taxud
SNB-REACT has sent an emergency letter regarding the working of Regulation 1383/2003. The letter focuses on two important obstacles encountered in the framework of our anti counterfeiting operations, as well as the (positive) experiences with the simplified procedure of article 11 of the Regulation and the role of transporters in storage costs.

Enormous quantities of counterfeit goods are seized and simply burned, despite of the fact that the possibilities of recycling are available in some Member States. Unfortunately, member States refuse to allow international transportation of fake goods for any reason including recycling! They take the position that article 16 of the Regulation prevents the international transportation of counterfeit and pirated goods. In our opinion, the impossibility to transport counterfeit goods internationally for recycling purpose should be considered as an undesirable result that does not match environmental interests. SNB-REACT proposed several ways to overcome this problem and requested EU guidelines.

A second problem that our members found arises from the definition of Article 2 par 1 a i) of the Regulation. This article provides a definition of counterfeit goods much more restrictive than the definition of trademark infringement in Regulation 40/94 on the Community trademark and the national trademark laws of the Member States. The definition of counterfeit goods is limited to “goods, including packaging, bearing without authorization a trademark identical to a trademark validly registered in respect of the same type of goods”.

This means that customs authorities cannot impose measures against unauthorized use for goods which the trademark has not been registered. The limitation of the Regulation allows strictly speaking the abuse of a brand on products for which the brand is not registered. However, these goods fall clearly under the perception of counterfeit goods.

By excluding the possibility to stop these illegal goods (according to the Community law or the law of the Member State) the most important enforcement mechanism to prevent them appearing at the markets is being denied to the rights owners. As far as we know there is no justification. In our opinion, this fail should be repaired by an amendment of the Regulation by which the definition corresponds with the scope of protection of the First Directive 89/104.

SNB-REACT, on behalf of our members/right owners has very positive experience with the simplified procedure in the Netherlands, Portugal, Greece and Lithuania. This procedure allows the destruction of large quantities of counterfeit goods in a short period of time against relatively limited costs and paperwork compared to civil or criminal proceedings. The simplified procedure has also the important advantage that storage costs are reduced because of the short procedures compared to Court proceedings. That is why we asked the Commission to encourage its introductions European wide.

Regarding storage costs, the situation is more problematic. Those costs are far too often simply shifted to the rights owners whereas the transporter is in a much better position as a contract party to charge the costs where they belong:  the infringing parties. We strongly believe that the consciousness of the transport sector of the risks of carrying counterfeited goods should be improved. They should be encouraged to take preventive measures in their conditions and contracts against the potential damage caused by the detention of fake goods. This is also in line with action points of the Commission according to the aforementioned Communication from the Commission (COM (2005) 479 final Brussels 11.10.2005). See also the article about the China Shipping case.

If you are interested in reading the full text of our letter, do not hesitate to contact the secretariat.


Important provisional decision about simplified procedure and demurrage costs
On 22nd August 2006, the summary judge of the Rotterdam District Court has rendered a decision in a case that was initiated by 15 SNB-REACT members against shipping agent China Shipping.

In this case, the Dutch customs have, under EC Regulation 1383/2003, suspended release or detained 56.000 counterfeit goods from various shipments in the period of May 2005 and April 2006. The right holders tried to get the products destroyed through the simplified procedure of article 11 but China Shipping refused to surrender the goods for destruction until they received the demurrage costs.

In face of this, the right holders decided to start summary proceedings asking the summary judge to order China Shipping to surrender the goods. China Shipping filed a counter claim asking for compensation of its demurrage costs.

The claims of the right holders and China Shipping were both rejected. However, the summary judged gave a positive opinion for the right holders about the demurrage costs saying that they are not liable for these costs and that these should be paid by the assignor of China Shipping. The articles 6 jo 11 does not leave the room, according to the provisional consideration of the judge, to grant the transporters a claim for demurrage costs.

Furthermore, the summary judge ruled that those goods which are not covered by a clear trademark registration (for example camera bags bear TM of aides, shirts bearing GM trademarks, etc.) are not sheltered by the Regulation and cannot be surrendered for destruction. China Shipping was entitled to oppose against it in order to safeguard the interests of its clients, which is a consequence of the wording of articles 1 job 2 par 1 sub a of the Regulation.

Article 11 can be applied directly according to the summary judge and does not require specific national legislation. The claim of SNB-REACT to surrender the other goods, the ones covered by the Regulation, for destruction has been rejected duly to the fact that the judge concluded wrongly that the conditions of article 11º were not met. Parties have not lodged an appeal and have settled the matter in the meanwhile.

Expansion SNB-REACT network in Balkan and beyond!

Nowadays, SNB-REACT’s network is covering a large part of Europe. The new unit established in Balkan stretches out beyond the European Community. This unit has started its activities in Macedonia and so far they had about 20 very good actions against traders trying to transit counterfeit goods from Turkey to several European countries. Macedonia Customs deserve a complement for their positive attitude towards IPR enforcement. This is an example to be followed in neighbouring countries and that is what SNB-REACT’s Balkan unit is trying to do. Through alert actions by Customs, followed up by simplified proceedings managed by SNB-REACT, IPR enforcement can get a completely new dimension in a short time. Keywords are consistency, quickness and economise!

Although the great work carried out in Macedonia, not everything runs smoothly. The storage and destruction of counterfeited problems is still complicated due to the absence of liable destruction facilities. The goods turn to be disposed of far from the ideal circumstances. Until now the solution has been transporting the counterfeited goods abroad to specialised destruction facilities. Political motivation will be required to change some Customs formalities that lead to this situation.

Perhaps not all members realise that SNB-REACT and its internal partners are already managing actions in Benelux, Baltics, Macedonia, Serbia, Italy, Portugal, Spain, Malta, Slovenia, Hungary, Poland, Czech Republic, Slovakia, Sweden, Denmark, Finland, France, Greece, Romania, United Kingdom and Austria. Our formula off affordable and quick enforcement has become an inevitable tool in the IPR enforcement of many brands, since the traditional enforcement is not suitable and the company budgets do not allow managing thousands of simple cases. This is the main reason for our persistent will to expand this network in countries perceived as “difficult” to effectively enforce IPR such as Russia and Turkey. We hope to come up with proposals for this situation in the very near future.

WCOIPR technical assistance seminars:

Uganda; Kampala 25-27 October 2006
The first WCOIPR technical assistance seminar on the African continent was recently held in the beautiful Serena hotel in Kampala. This was a seminar focusing on awareness building with the enforcement authorities of all levels in Kenya and Uganda.

With very active and positive participation from Uganda and Kenya enforcement officers, it was definitely a very promising seminar. The seminar resulted in a list of recommendations to improve the legal and practical enforcement structure in these countries. The situation is definitely alarming with fake goods in all sectors coming from China and wiping out legitimate industries. Rights owners have to be patient in these countries and take into consideration the stage of development when organizing their IPR enforcement. This first seminar must be followed up by another series of national events to achieve long run results.

The event was sponsored by BAT, Sara Lee, Unilever, Procter & Gamble, Everready, Benckiser, BIC and GSK and we are very grateful with the active and professional input from the speakers from Spoor & Fisher Jersey and Mkono & Co lawyers, Comessa, Rilo and Uganda Revenue authorities.

Turkey; Istanbul 16 November
Informal and technical identification training was held the 16th of November 2006 in Istanbul for about 90 customs officers mainly from Istanbul region. Since we had only one day for this training, some rights owners had unfortunately to be refused. The interest for more and better enforcement in Turkey is obvious. Turkish customs disclosed some interesting figures. With about 250 customs actions, the situation is clearly improving, however not yet sufficient. Of the ex-officio cases only 40% receives a follow up and even the suspensions based on notifications by business are released in 30% because of lack of response from rights owners. The main reason seems to be the complicated lengthy and costly Turkish legal proceedings. This definitely has to change before even insisting on increased enforcement. Hopefully soon, the simplified procedure will be adopted in Turkey. Unfortunately only partly, but it will in any case offer a way to avoid the formal Turkish legal proceedings. The introduction of the simplified proceedings is for SNB-REACT reason to explore the possibilities of an office in Istanbul.


Technical Assistance Programme:

WCOIPR:
India, New Delhi: Diagnostic Analysis - March 2007
Geneva, Switzerland: IPR Strategic Group meeting of business partners - 29 January 2007 at the offices of Procter & Gamble

SNB-REACT
Macedonia, Skopje; Technical Assistance Seminar -  January 2007 foreseen
Estonia, Tallinn: Technical Assistance Seminar - February 2007
The Netherlands, Amsterdam: Annual meeting and General Assembly – 15th March 2007
The Netherlands, Amsterdam: Technical Assistance Seminar – 16th March 2007
Portugal, Lisbon: Technical Assistance Seminar – April 2007

Cases:



Internet Monitoring:
Recently we have extended and intensified our searches, also by including our Portuguese office in the Internet Monitoring Program. This has lead to 25.000 removed advertisements from several auction websites over the last 10 months, which reflects a smashing increase of 85% compared to the last year.

Currently we are looking into improving our tooling that will make our Program even more efficient. Besides this, we are having regular meetings with auction sites like E-Bay and Marktplaats to evaluate and improve the removal procedures.

Overall we are very pleased with the Program. The combination of online searches, on-site investigations and taking legal action has made it a new tool that allows us to fight the online counterfeit sales that have become so important over the last years.

In the graphic below you can verify the total number of removed advertisements since January till October 2006.