U.S. Customs and Border Protection (CBP) is tasked with the monitoring of and enforcement of intellectual property rights (IPR). In CBP’s FY 2018 Seizure Statistics, CBP advised that it enforced trademarks and copyrights pertaining to over 17,641 active recordations, including 2,289 new recordations and 812 renewals of expiring recordations.
In fiscal year 2018, 381 individuals were arrested by CBP or ICE for violations related to IPR violations and 260 convictions related to intellectual property crimes proceeded. The total number of IPR seizures decreased by 333 seizures from the previous year. Surprisingly, while the number of seizures decreased from 34,143 in 2017 to 33,810 in 2018, the total estimated manufacturer’s suggested retail price (MSRP) of seized goods, had they been genuine, increased $1.4 billion.
In 2018, the two biggest offenders of IPR infringements came from essentially one nation. Out of the 33,810 total seizures last year, 29,459 (87%) originated from China and Hong Kong. The products seized from China and Hong Kong also account for roughly 85% of the total MSRP.
IPR and Seizure Facts
According to the report, CBP concentrates its IPR enforcement on trademarks and copyrights. For the 2018 fiscal year, CBP’s Integrated Trade Targeting Network (ITTN) performed 26 national level IPR-Trade Special Operations, and 103 local IPR-Trade Special Operations. These special operations targeted high-risk shipments at seaports, airports, international mail facilities, and express carrier hubs across the U.S. The operations netted 4,891 seizures for IPR-infringing goods. If mistakenly perceived to be genuine, these goods would have a total estimated MSRP of $94 million. This represents a 104% increase in MSRP from IPR-Trade Special Operations from the previous fiscal year (2017). In 2017, 12 national IPR-Trade Special operations resulted in 1845 seizures of goods worth $44 million. To effectively combat IPR infringements, recordations permit CBP to police trademarks with precision. Only trademark and copyright holders are eligible for CBP recordations – it establishes a standard of accountability and organization.
CBP also has the authority to issue penalties to counterfeiters. It’s another benefit to U.S. trademark owners that record their trademark or copyright with CBP, which provides the authority for CBP to issue monetary fines against anyone who facilitates the attempted introduction into the U.S. of seized counterfeit merchandise. It is the anti-counterfeiting consumer protection act which provides authority for CBP to impose civil fines pursuant to 19 U.S.C. § 1526(F), in addition to the seizure and forfeiture of imported merchandise bearing counterfeit marks. The parties subject to monetary fines are any person who “directs, assists financially or otherwise, or aids and abets the importation of merchandise.”
IPR & E-Commerce
E-commerce is another industry ravished by IPR violations. Considering that in fiscal year 2018 there were 161 million express shipments and 475 million packages shipped through the international mail environment. For 2018, over 90% of all intellectual property seizures occurred in the international and express mail environments.
In March 2018, CBP released its CBP E-Commerce Strategy. CBP aims to strengthen its own ability to protect the public and the U.S. economy from non compliant goods. Further, the strategy is meant to drive compliance and enforcement with U.S. laws while promoting coordination.
Contact us for assistance in recording your IPR with CBP; being proactive is the number one method to protect your goods from potential counterfeiters. If you unknowingly purchase illegitimate goods that were seized by CBP, we strongly recommend contacting us to assist you in the detention, seizure, and/or penalty process.