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Measures to prevent illicit trade
Rashid ul Ahsan Chowdhury
3/29/2006
CONSIGNMENTS imported from a country not identified by the right holder as a country where genuine goods are manufactured or imported from a country lacking intellectual property protection may contain counterfeit or pirated goods. If the purchase value of goods in a consignment is pre-paid in cash or on a cash-on-delivery basis rather than by letter of credit, the consignment may be listed as suspect. Merchandise shipped in less than usual quantity or shipped to a consignee with post office box address or in" drop address, or shipped to a fictitious freight forwarder, individual or company not listed in the commercial telephone directory, may contain such kind of fraudulent goods.
Any shipment described as 'labels,' 'patches,' 'tags,' 'imprinted boxes,' or 'dyes,' may contain counterfeit trade mark goods. Consignments with unusually vague invoices or invoices lacking model or catalogue numbers may contain counterfeit or pirated goods. Compact disks, audio cassettes or video cassettes shipped as blank or unfinished, video games shipped in assembled cabinets rather than in components for assembly, textile products not labeled with fiber contents or cleaning instructions, popular toys and games and mail shipment of high technology goods may contain counterfeit or pirated items. If merchandise, packaging, labels boxes, or tags are printed with miss-pelling, the contents are either counterfeit or pirated.
The investigation and detection of counterfeit or pirate goods require skill, knowledge and experience on the part of a Customs officer. An officer investigating a counterfeit or pirated fraud has to be conversant with the laws and rulings in force relating to counterfeit or pirated goods in the country and should also have knowledge of international rulings, conventions, agreements and the Intellectual Property Rights (IPR) fraud information on the subject. He should have basic knowledge of computers and systems as well as experience and expertise in general fraud investigation.
To properly investigate counterfeit or pirated goods the investigating Customs officer should be familiar with local and international trade pattern of counterfeit and pirated goods. He should also have knowledge of previous cases, modus operandi and convictions in fraud cases. For successful investigation, knowledge of and access to reference material is also important. The investigating officer should also have the knowledge of terms used in international trade processes and the knowledge of prohibitions and restrictions in force within the country. Access to and liaison with trade bodies and enforcement agencies concerned with counterfeit or pirated products is also important for investigation. The investigating officer should also be able to identify other interested agencies or authorities and, if appropriate, exchange information with them about the trade in counterfeit or pirated goods.
To conduct proper investigation of counterfeit or pirated merchandise an investigator should also have training on intelligence gathering techniques including the use of statistical information. He should develop expertise in intelligence analysis, risk assessment, targeting and profiling of counterfeit or pirated goods and importers involved in such shady businesses. He should also have expertise in examination of records, interviewing and interrogation, search and seizures as well as reporting and recommendations.
In recent times the trade in pirated and counterfeit goods has reached substantial proportions in Bangladesh, The boom and profit in the trade has encouraged the involvement of criminal elements who find the trade very lucrative and relatively hassle-free investment. The increase in import and export of pirated and counterfeit goods means that there should be increasing surveillance and controls by the Customs authority and thus an increase in their role to eradicate trade in pirated and counterfeit products. However, such increased control will result in additional costs for importers, exporters and other commercial operators engaged in legitimate trade.
Although the National Board of Revenue can play a very effective role in combating counterfeiting and piracy, it is unfortunate that in Bangladesh the Customs authority have little legal authority or expertise in this field. The existing trademark and copyright laws were enacted long before counterfeiting and piracy were problems of grave concern in international trade. At present in Bangladesh there is no enacted legislation to provide the Customs authority with appropriate power to fight counterfeiting and piracy. With the fraudulent trade becoming a genuine threat to the legitimate national trade, the National Board of Revenue should undertake steps to give the Customs administration appropriate powers to fight counterfeiting and piracy in the context of trademark and copyright violations. However, the extent and effectiveness of Customs intervention will depend on the resources available to the Customs.
While taking such steps, the National Board of Revenue has to ensure that the measures and procedures to enforce intellectual property rights do not themselves become barriers to legitimate trade. Therefore, to promote effective and adequate protection of intellectual property rights the role of Customs has to be defined precisely. The Customs control procedures should primarily centre on detection and seizure and penalisation for Customs offences and violation of trademark rights. Development of skill and knowledge through proper training will enable the Customs authority to enforce effective control in this regard. The use of effective controls will allow the Customs authority to focus its resources more efficiently and to develop strategies based on those controls. Further the Customs controls must be continuously evaluated and adapted as necessary. Feedback is an important part of the evaluation process. Timely communication between the offices effecting the controls and the intelligence team will also be crucial.
It is necessary to point out that the owners of trademarks and copyrights also have important responsibilities to protect their own rights. Such measures include, for an example, the registration of trademarks as prescribed by trademark law, and the notification to the Customs that they own the rights which have to be protected. When informed of the owners' rights, the role of the Customs will be limited to assisting in the enforcement of protected rights of the owners. The Customs action to protect the owners will be boosted if the National Board of Revenue enacts severe penal provisions in the national legislation against infringement of intellectual property rights by the importation or exportation of counterfeit trademark or pirated goods.
It is, therefore, apparent that a series of appropriate management measures and reform programmes will enable the National Board of Revenue to curb illicit trade of counterfeit and pirated products. These measures and programmes will include such actions as appropriate laws and procedures to protect legitimate trade and discourage fraudulent trade; proper training of the Customs officials in fraud investigation and detection; best utilisation of available resources; adequate provisions in the national legislation for enforcement of Customs preventive activities; and severe penal provisions for fraudulent trade in counterfeit and pirated goods. It is important for the National Board of Revenue to accept the suggestions as enumerated above and chalk up a long term action plan and the strategy to combat infringement of intellectual property rights.
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The writer is the Permanent Representative of Bangladesh to the World Customs Organisation, Brussels, Belgium
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