You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

February 6, 2023

Enforcing IP Rights in Cambodia: Available Customs Measures

Subscribe to Updates

The available options for enforcing intellectual property (IP) in Cambodia have steadily increased over the past years, and both enforcement authorities and IP owners have gained valuable experience in enforcement operations. This experience, alongside new legal developments, has contributed to an increase in successful IP enforcement cases—most notably those involving the police or the courts in Cambodia.

Targeted government policies have further fostered a more robust IP enforcement framework in Cambodia for both local and foreign IP owners alike. These owners collaborate with government actors in a bid to protect their IP in Cambodia and ensure that quality goods reach Cambodia’s consumers. Cambodia’s obligations under the Regional Comprehensive Economic Partnership (RCEP) related to IP and especially IP enforcement will lead to even more positive developments.

Customs Enforcement

Recently, many IP owners have shown particular interest in enforcement opportunities involving Customs in Cambodia, as these IP owners recognize Customs as a key authority in fighting the inflow and outflow of infringing goods.

Customs (officially named the General Department of Customs and Excise) is responsible for monitoring the import and export of goods at border checkpoints, and levying duties and taxes on imports and exports. They facilitate trade, which is key for the private sector and government alike, and they collect taxes that can be used for the government and the public good.

In this role, Customs is an important agency in fighting infringement, either by stopping imports so that the infringing goods do not reach consumers in Cambodia, or by taking action against exports, thereby making Cambodia less desirable as a manufacturing or transit hub for infringing goods. Besides improving the reputation of the country as a destination for investment and business, it can benefit the public as well, because infringing goods are often smuggled or misdeclared to avoid duties and taxes, resulting in a loss for the Cambodian economy.

Although Cambodia does not yet have a Customs trademark recordal system in place, there are still a number of ways Customs can play a key role in any enforcement strategy.  Below we address these available Custom enforcement options with a focus on imports, but most measures also apply for export of goods.

Shipment Clearance Suspension

A very welcome development in recent years is a prakas that covers suspension of shipment clearance for goods that violate intellectual property rights. Prakas No. 196 on the Policy for Suspension of Customs Clearance Procedure of Imports and Exports violating Intellectual Property Rights was issued on March 29, 2021, by the Ministry of Economy & Finance (MEF)—in which Customs is a department.

The prakas specifically addresses goods violating trademarks, geographical indications, copyrights and related IP rights. It sets out how Customs is to handle a request for suspension filed by an IP owner, and it clarifies Customs’ ex-officio powers to suspend shipment clearance for goods they suspect are in violation of intellectual property rights, without the need for a prior complaint or request from the IP owner. These clearly defined ex-officio powers are a great tool for Customs to use in the fight against infringing goods.

After a suspension action based on either a complaint or an ex-officio action, Customs may invite the IP owner to inspect and confirm whether the goods violate their IP rights. If there is sufficient evidence of counterfeiting or other infringement, Customs may initiate a dispute resolution process or refer the matter to court for further action. Customs clearance of the concerned shipment remains suspended pending the outcome of the matter, and the goods may be eventually seized and confiscated by Customs during the process, or by an order of the court, which can also order the destruction of infringing goods in most cases.

While Customs officials arguably already had the power to take ex-officio action, the clarification of this power in Prakas No. 196 gives Customs officer much more legal certainty to take ex-officio action. This should contribute greatly to curbing the flow of infringing goods into and out of Cambodia.

Lastly, the prakas addresses security bonds. In the past there was uncertainty about the legal support to both request a bond and the formula to calculate the bond.. Under the new prakas, Customs has clear legal authority to request a security bond from IP owners for shipments suspended in relation to IP infringement, at 30% of the value of the goods in the suspended shipment (or higher for perishable goods).

Customs has issued official instructions to its officers, including the related forms and guidelines to request suspension of Customs clearance based on the new prakas, marking Customs’ increased focus on fighting the import and export of infringing goods.

In short, the Prakas is a very notable step forward for Customs, as it provides a clear legal framework for them to take action against infringing goods. Moreover, Customs officers have expressed willingness to implement the measures, and they welcome complaints from IP owners.

Parallel Imports and Recording an Exclusive Distributorship

Cambodia’s legal framework prohibits parallel importing of trademarked goods, as per the Law Concerning Marks, Trade Names and Acts of Unfair Competition. Accordingly, this presents an additional enforcement avenue in which Customs can play a key role.

To enforce their IP rights against parallel importing, owners must record an exclusive distributorship in Cambodia with the Ministry of Commerce. This recordal is done by making a series of straightforward filings, which then provides the IP owner and its appointed exclusive distributor with an exclusive and enforceable right to import and distribute the relevant trademarked goods in Cambodia.

A recordal is valid for two years and can be renewed. Notably, IP owners may withdraw a recordal at any time if they wish to terminate the exclusive distributorship.

Once a distributorship is recorded, enforcement actions can be taken when goods are parallel imported or distributed in Cambodia by any entity or individual other than the registered exclusive distributor. The current regulations do not prohibit exclusive distributors from appointing subdistributors, so that effectively the exclusive distributor actually only functions as an exclusive importer, with further distribution rights given to other entities in Cambodia. In such a scenario, the agreements covering these distribution networks should be clearly drafted to evidence what rights the IP owner has given to the exclusive distributor and its subdistributors.

After recording an exclusive distributorship, the Ministry of Commerce shares the recordal information with Customs, which adds the information to the Customs information database they refer to when inspecting shipments.

Checking the importing entity’s name against the database with recorded exclusive distributorships is an easy and straightforward process. Customs officers do not have to verify if the goods are genuine or counterfeit—which can be a difficult determination for officers not familiar with the particular brand of goods. Rather, the officers merely check the name of the importer against the database, and if the goods are not imported by the recorded exclusive distributor, the shipment can be suspended, pending further action.

A welcome practical effect is that measures meant to stop parallel imports may also stop infringing goods imported by parties other than the recorded exclusive distributor. Customs may, in its efforts to curb parallel imports, stop shipments not for the exclusive distributors, and these shipments may very well turn out to be infringing goods, such as counterfeits. Customs may then take action either under the regulations prohibiting parallel imports, or under Prakas No. 196 based on the import of infringing goods, as discussed in the previous section, depending on the circumstances.

This removes the need to make a (sometimes difficult) determination on the genuine or counterfeit nature of the goods. A shipment not imported by the recorded exclusive distributor can be suspended based on potential parallel importing, followed by an invitation to the actual IP owner (or exclusive distributor) to make the determination on the nature of the goods. If the goods are infringing, appropriate action can be taken in accordance with the law. If the goods are parallel imports, Customs can take action against them as well, under a different set of rules.

Engagement with Customs

Although formal Customs recordal is not available in Cambodia, IP owners with information on checkpoints that are often used by shipments of infringing goods can contact the relevant Customs office at the checkpoint to cooperate with the officers there.

If there is sufficient information, Customs may exercise its ex-officio powers to suspend suspect shipments, followed by the IP owner filing an official complaint if the products are confirmed as infringing.

Local Customs officers are generally open to working with IP owners if the information is strong enough to justify suspending or more closely inspecting shipments. However, it is not possible to make a general request that Customs inspect all shipments for an IP owner’s trademarked goods. Nevertheless, with specific information, an IP owner can initiate cooperation and information sharing with Customs, which can be an effective way to stop shipments of infringing goods.

Conclusion

Customs now has additional legislative tools—and the required experience and practice—to increase their enforcement efforts against shipments of infringing goods in Cambodia. Both parallel imports and infringing goods can be stopped if IP owners cooperate with Customs on information sharing and other matters, act promptly on inspection requests, file complaints in support of Customs actions, and provide security bonds as requested under Cambodian law.

Cambodian Customs has shown an eagerness to implement the latest developments and to take action, especially when IP owners actively engage with them. In short, Customs has become a valuable tool in the enforcement arsenal available to IP owners in Cambodia over the past years. Owners may find considerable benefits from including Customs enforcement in their strategy for protecting IP rights in Cambodia.

Related Professionals

Practices

Intellectual Property

Location

RELATED INSIGHTS​ 

December 20, 2024
Closing out the year, Thailand’s Department of Intellectual Property (DIP) has gifted green innovators with a chance to take a faster route for examining their patent and petty patent applications under the “Target Patent Fast-Track” program. This route prioritizes environmentally sustainable inventions, and significantly accelerates the preliminary and substantive examinations of selected applications at no additional official fee. The program was publicly announced on December 2, 2024, in the DIP Notification on the Expansion of Technological Fields under the Target Patent Fast-Track Program, which took effect on December 15, 2024. The expedited process is open to both Thai and foreign applicants, provided the requirements in the notification are met. Under the fast-track program, a first office action for qualifying applications can be expected within 6 months during the preliminary examination stage. These applications will also be issued a first office action within just 12 months in the substantive examination period after publication. The DIP begins accepting formal requests for selection to participate in the program from January 1, 2025, onward. Each applicant can submit only one application per fast-track patent program per month, as selected applications cannot belong to the same applicant. No more than 10 applications per month will be chosen to participate in the fast-track route, with the results being announced on the 5th of every following month. To be eligible for selection, applications must comply with all the fast-track requirements specified in the recent DIP notification, particularly: The patent or petty patent application must have been filed with the DIP for at least three months, or a substantive examination request has already been filed in the case of patent applications. Each application must contain no more than 10 claims throughout its participation in the program. The application must be electronically filed in Thailand first or through
Read More
December 18, 2024
The EU-Thailand Free Trade Agreement is drawing a lot of interest as the fourth round recently concluded in Bangkok. Despite negotiations starting in 2013, there was a ten-year pause before we saw the first round of negotiations end in September 2023. The initial plan was for four rounds of negotiations, with the free trade agreement (FTA) finalized in 2025. However, following the fourth round it is clear that the negotiations are still ongoing. Now, the question is: how much closer are the EU and Thailand to concluding their FTA? The EU initially submitted 13 chapter proposals for the FTA, followed by a further 12, and these became the springboard for the negotiations. Given the complexity of agreeing on an accord of this size, there will probably be additional proposals submitted in 2025. These chapters have seen sector-specific negotiation groups formed, and although it has been difficult to truly gauge the status, steady progress has been made in each. Arguably one of the biggest points of discussion pertains to the customs process for imports and exports. Both sides aim to align their practices in relation to rules of origin and custom rates, with preferential tariff treatments offered to goods originating from Thailand and the EU, as well as talks of eliminating or reducing relevant taxes. The desire for a faster customs clearance can be seen in EU proposals for clearance of goods on arrival. Although there has been progress in agreeing to a more simplified customs process, more work needs to be done before we hear news of the agreed-upon fees and charges, or confirmation of what goods would be allowed temporary admission. When we consider customs clearance, it is important to also examine what this FTA could mean for rightsholders. One piece of good news is that it appears
Read More
December 9, 2024
Cambodia’s Law on Seed Management and Plant Breeder’s Rights was enacted in 2008, but it was not until recently that new plant varieties could successfully be registered for protection in the country. Although the law has been in place for some time, recent developments confirmed the application process and a schedule of charges for the registration of new plant varieties. With these developments, breeders have been able to register their new plant varieties in Cambodia since March 1, 2024. Applicants for new plant variety protection must be Cambodian nationals, foreign nationals domiciled in Cambodia, or permanent residents of either a country that is a contracting party to the International Union for the Protection of New Varieties of Plants (UPOV) Convention or a country with which Cambodia has signed a memorandum of understanding on plant variety protection. Applicants can also claim a priority date from the first application for the same plant variety filed in any contracting party of the UPOV Convention within 12 months of the earliest application’s filing date. To be eligible for protection, new plant varieties must satisfy the following criteria: Novelty: A variety is considered “new” if, at the date of filing the application for new plant variety protection, it has not been sold, marketed, or otherwise disposed of others—by or with the consent of the breeder—for more than: One year for any plant variety in Cambodia; Six years for trees and vines or four years for all other plant varieties in countries besides Cambodia. Distinctiveness: A variety must be clearly distinguishable from any other existing varieties. Uniformity: A variety must be sufficiently uniform in its relevant characteristics. Stability: A variety must remain unchanged in its essential characteristics at the end of each cycle of propagation and in each generation. The last three criteria are often
Read More
December 4, 2024
On December 1, 2024, Myanmar’s Intellectual Property Department (IPD) issued the first group of trademark certificates of registration for marks registered under the Trademark Law of 2019. This is the first registration announcement since the start of the IPD’s soft opening period in 2020. With the registration of marks now in place, registered owners will benefit from stronger legal protections. These protections include the exclusive right to prevent unauthorized use of identical or similar marks by third parties and the ability to take enforcement and administrative actions. Myanmar’s implementation of the “first-to-file” system further emphasizes the importance of early registration. Marks registered at an early stage will be in a stronger position when filing oppositions against subsequent applications for identical or confusingly similar marks. The IPD issues certificates of registration in an electronic format to owners who have filed their applications via the IPD’s online filing system. For applicants who submitted their marks via physical applications, the IPD will issue physical certificates of registration. The initial registration term for a mark is 10 years from the filing date and is renewable for additional periods of 10 years each time. The IPD publicly discloses the details of marks registered under Myanmar’s Trademark Law via their official website. The IPD’s issuance of mark registrations under the Trademark Law of 2019 is a decisive step forward in intellectual property protection in Myanmar. It enhances legal safeguards for mark owners and any other authorized persons, and affirms Myanmar’s commitment to aligning its practices with global standards. For more information on protecting intellectual property rights in Myanmar, please contact Tilleke & Gibbins at [email protected].
Read More