It’s understandably frustrating when you spend significant time negotiating an exclusive right to distribute or sell a particular brand in Australia, only to have someone start importing the same brand into the country. It is important to understand how to protect your brand from parallel importing, particularly when you have invested time and effort for the exclusive right to use the name or brand.
Parallel importing occurs where an individual or business, who is not the owner or a licensed user of the trade marks associated with the products, imports branded products. Parallel importing is legal in many cases in Australia.
A distributor or reseller of a product may own an Australian trade mark connected to the products they sell which gives them an exclusive right to use the marks. Alternatively, they may be a licensee of the trade mark, which means the owner has given them permission to use the mark in relation to the products. Other businesses may, however, source the same branded products overseas and import them to Australia to sell locally.
The Australian seller who has the right to use the trade mark should then understand the steps they can take to protect their brand from parallel importing. You can do this by lodging a Notice of Objection with Australian Customs and Border Protection Services (Customs).
This article explains the benefit of using this strategy to protect your brand from parallel importing and the steps required to secure a Notice of Objection.
What is a Notice of Objection?
Similar to trade mark monitoring, it is your responsibility to notify customs of your right to sell the branded goods by lodging a Notice of Objection.
Customs can seize goods either when they suspect, or when the trade mark owner notifies them, that the goods are infringing trade marks. The trade mark owner, or authorised user of the mark, can then lodge the Notice of Objection. It must be in place for Customs to seize the goods.
There is no cost to lodge a Notice of Objection. However, the party who submits the Notice (the Objector) must undertake to pay any costs Customs incurred when enforcing the Notice. For instance, costs relating to storing the imported goods, transporting or even destroying the goods.
Why Use a Notice of Objection?
Parallel importing could threaten your brand and exclusive right to sell a product in Australia. Despite any exclusivity clause, there may be circumstances outside both parties’ control that lead to third parties being able to sell the same brand.
A Notice of Objection is a cost-effective option you can take to help protect your brand from parallel importing. Customs then has the power to identify and seize suspected goods and notify you of their actions. Once this happens, the importer must then prove that they have the right to sell the goods either by ownership or consent from the trade mark owner.
What Happens When Customs Seizes the Goods?
Customs notifies both the Objector and the importer when they seize the suspected goods. The importer has to make a claim to release the seized goods within ten business days from when they receive the Notice of Seizure.
After Customs receives a claim, they must notify the Objector who also has ten business days to commence proceedings against the importer. The importer must then, for this reason, provide with their claim information about themselves so the Objector can identify who they are. The Objector is also given a chance to inspect the goods and even remove samples of the goods. On the other hand, if the importer does not make a claim, Customs surrenders the goods to the Commonwealth.
The importer’s claim should also provide information about the party from who they are importing the goods (i.e. the sender). This can help the Objector identify the sender so they can take steps to prevent the parallel importing from happening in the future.
What Information Do I Need to Lodge a Notice of Objection?
You must complete a Notice of Objection form and provide the following details:
- Your full name and address. If you are an Australian-owned company, you will need to provide your ABN. If you are an international company, you will need a Customs Client ID.
- Whether you own the registered trade mark or whether you are an authorised user (licensee of the mark).
- Details of your legal representative, if any.
- Name and details of the person who Customs should notify when seizures occur.
What Documents Do I Need to Provide?
You must also submit a number of supporting documents with the Notice of Objection.
|Trade Mark Schedule||Include details about the trade mark including the registration number, date of expiry, registered classes and a description of the goods|
|Australian Trade Mark Search Report||Provide evidence of trade mark registration from the IP Australia online register.|
|Authorisation Letter||This is only required if you are an authorised user and not the registered owner.|
|Deed of Undertaking||You must sign a Deed of Undertaking where you agree to pay the costs Customs incurs when they enforce the Notice.|
|Authorised Importers List||Provide a list of the companies or individuals who are authorised to import the branded goods. Customs will not seize goods imported by the parties on this list. This is not a required document.|
The Notice of Objection is a cost-effective strategy to protect your brand from parallel importing. The processes prescribed also give you the opportunity to identify overseas parties who are carrying out parallel importing. It is advisable not to wait until you notice other businesses selling your brand in the market to take action. Taking the preventative step to lodge a Notice will ensure Customs seizes the goods before they are sold and damage your brand.
If you have any questions, get in touch with our specialist IP lawyers on 1300 544 755.
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