3. Border seizure by customs

In addition to civil measures, the holder of intellectual property rights also has the possibility at his disposal to pursue infringers with the help of the customs authorities. Based on the harmonised directives for border seizures within the European Union which aim to effectively prevent the import of products which infringe patents, trademarks or copyright, the system of border seizure in Germany is very strict and efficient.

The holders of intellectual property rights can submit a general application for border seizure with the German customs authorities. In such cases, the customs officials merely receive general information about the protection rights on which the application is based as well as characteristics which can be used at customs control to identify goods which infringe such rights. In this process, officials responsible for the examination of imported goods should not and would not be able to assess complex technical or legal circumstances.

The customs authorities check goods sent both when they are imported into Germany and during trade fairs and exhibitions. Upon mere suspicion of rights infringements, the officials initially secure the goods and inform both importer (usually a shipping company, not the manufacturer or distributor of the goods!) and rights holder. Insofar as the importer does not object to the seizure within ten working days, providing grounds for such an objection, the goods are finally seized and destroyed.

If the importer (or a representative thereof) does object to the impounding within the 10 day limit, the rights holder has a further 10 working days to file either a claim for injunctive relief or a main action with the aim of effecting a court ordered restraint on disposal obligating the importer to tolerate the impounding of the goods until such time as the alleged rights infringement can be clarified in court. If the rights holder does not institute such civil law proceedings within the time limit, the impounding order will be rescinded and the goods released.

4. Police seizure

In addition to the measures available under civil law and customs seizure, a holder of intellectual property rights also has the possibility of reporting persons suspected of importing, offering for sale or distributing rights infringing products to the law enforcement authorities and thus effecting police seizure and the institution of a criminal investigation by the public prosecutor.

Any wilful, unlawful and culpable infringement of an intellectual property right constitutes a criminal act under German law. Provided the matter is respectively reported to the police or public prosecutor, a seizure of the allegedly rights infringing objects can be ordered. Only in rare, exceptional cases does the police act directly. Usually, a search of business premises, trade fair stands or vehicles requires a court order which is granted upon application of the public prosecutor. The requirement for the granting of a search and seizure order is the existence of a well founded initial suspicion in respect of the existence or imminent occurrence of a criminal act. In such cases, the investigating judge must assume that the infringement of one or more intellectual property rights is being committed or is imminent. This in turn requires that the responsible investigating judge is convinced that the intellectual property right concerned is legally valid and being infringed.

Insofar as a police seizure then follows, the criminal proceedings are then often ceased, whereby a fine is set against those responsible and the confiscation and destruction of the goods is ordered. In bigger cases, it can indeed be the case that the criminal proceedings are carried out resulting in significant fines and in extremely rare cases even prison sentences being imposed. It is very rare that the objects seized by the police are released again, usually these are confiscated and destroyed.

5. Interim conclusion

It is evident, in light of the possibilities described above for asserting intellectual property rights claims against actual or alleged infringers on the occasion of trade fairs and exhibitions, that companies who present their goods at such events are faced with many and various risks. Even simply the risk that the exhibition and offer of possibly rights infringing goods may provoke main proceedings before a German court is significant in that it represents a danger for foreign exhibiters of being drawn into a costly court battle in an unfamiliar legal system. Furthermore, in the case of a conviction, the exhibiting company faces not only a permanent ban on sales but also claims for damages, recall and destruction all due to a rights infringement of which the company was previously unaware. In light of the fact that claims for injunctive relief exist under German law regardless of whether the infringer acted with intent or not, the exhibitor of products which – possibly without his knowledge – infringe patent rights, trademark rights or copyrights of another, has possibly to deal with considerable negative consequences and, in particular, costs.

The risk is still higher, that an exhibitor may be confronted with a civil law preliminary injunction on the occasion of a trade fair or exhibition. Unlike in cases where main proceedings are brought, which can be precipitated by the presence at a trade fair but do not initially affect the participation therein, injunction proceedings can directly lead to a lasting impairment of the immediate trade fair activities. If important objects to be presented are impounded on the basis of a preliminary injunction during the trade fair itself, the granting and enforcement of a preliminary injunction can often ruin the success of the entire participation in the trade fair.

Particular risks for foreign companies who present products at trade fairs in Germany are also harboured in the system of border seizure. The danger is, on the one hand, due to the extremely short time limits which apply as well as that an immediate and energetic reaction of the importer is required as soon as the customs authority has ordered a border seizure. If the seizure of trade fair exhibits is undertaken directly prior to the trade fair taking place, it is often impossible, even in cases where no infringement has occurred, to effect the release of the impounded goods in time for the trade fair. A particularly problematic element for foreign trade fair exhibitors is the fact that the customs officials tasked with the enforcement of border seizures inevitably cannot have the requisite knowledge in order to legally assess technically complex situations. Whilst customs officials are indeed often able to form an opinion on the possible existence of trademark or copyright infringements, this is regularly not the case where border seizures are based on the alleged infringement of patents. In such cases, the customs officials rely heavily on the information provided by the patent owner when assessing whether an infringement has occurred. This, in turn, means that patent owners have lasting opportunities to remove particular products, whose patent infringing nature is more than questionable, from the market, with the help of the customs officials in border seizure proceedings, or at least to keep such products away from the trade fairs.