Geography Reference
In-Depth Information
(xi) Remedies
Without prejudice to the infringement actions which may be brought by a right
holder, and subject to the right of a defendant to seek review by a judicial
authority, Art 59 provides that the competent authorities shall have the
authority to 'order the destruction or disposal of infringing goods' in accordance
with the principles set out in Art 46. Article 46 requires any disposal of goods to
be outside the channels of commerce 'in such a way as to avoid any harm caused
to a right holder'. In deciding upon destruction, the competent authorities will
take into account the seriousness of the infringement and the interest of third
parties. In regard to counterfeit goods, Art 46 provides that 'the simple removal
of a trademark, unlawfully affixed shall not be sufficient, other than in excep-
tional cases to permit the release of the goods into the channels of commerce'.
Similarly, Art 59 provides, in relation to counterfeit goods, that the authorities
'shall not allow the re-exportation of the infringing goods in an unaltered state
or subject them to a different customs procedure, other than in exceptional
circumstances'.
2.172
The scope of Art 59 was addressed by the WTO dispute panel in
China -
Measures Affecting the Protection and Enforcement of Intellectual Property Rights
.
68
This determination addressed, inter alia, whether China's Regulations on
Customs Protection of Intellectual Property Rights, 2003 complied with Art
59. The Regulations permitted confiscated goods which infringed IPRs to be
used by public welfare bodies in social public welfare undertakings. Where the
goods concerned could not be disposed of in this way, but the infringing
features could be eradicated, they could, according to the Regulation, be
auctioned off after eradicating the infringing features. Where the distinguish-
ing features could not be eradicated the goods had to be destroyed. The US
claimed that as the Chinese customs authorities were required first to donate
seized goods to social welfare bodies, they lacked the discretion to order the
destruction or disposal of infringing goods required by Art 59 of the TRIPS
Agreement. The response of China was that this donation constituted disposal
outside the channels of commerce in such a way as to avoid harm to the right
holder.
69
2.173
In interpreting the meaning of 'infringing goods' in Art 59 the Panel read down
the meaning of these words, by reference to their context, which included the
first sentence of Art 51, which provided for the relevant procedures to apply, as a
minimum, to 'the importation' of 'counterfeit trademark or pirated copyright
2.174
68
Report of the Panel, WT/DS362/R, 26 January 2009.
69
Ibid, paras 7.197-7.198.
