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​ 

January 31, 2024
On January 31, 2024, Myanmar’s Intellectual Property Department (IPD) announced that it would officially start accepting industrial design applications under the Industrial Design Law on February 1, 2024. The IPD made this public in Announcement No. 1/2024, which comes three months after the Industrial Design Law entered into force on October 31, 2023. The Industrial Design Rules, issued by the Ministry of Commerce (MOC) on September 29, 2023, are another key instrument regulating the registration of industrial designs in Myanmar. In addition, the MOC’s Notification No. 71/2023 issued on October 27, 2023, specifies the forms required for industrial design registration and related actions, and the fees are specified by the IP Agency under Notification No. 2/2023, issued on December 29, 2023. Industrial design owners (individuals and legal entities) can file registration applications for new industrial designs with the IPD electronically, in person (directly or through a local representative), or by post. To be registered under the Industrial Design Law in Myanmar, industrial designs must be “new,” meaning that they must not have been disclosed to the public inside or outside Myanmar prior to the application date or the date of priority, if priority is claimed. Owners who wish to apply for and enjoy statutory protection of their industrial designs in Myanmar should start preparing all necessary documents and information for filing as soon as possible. For more information on industrial design registration in Myanmar or assistance in applying to register industrial designs, please contact Tilleke & Gibbins at [email protected].
Read More
January 24, 2024
Mickey Mouse (or, rather, a specific early version of the iconic Disney character) famously entered the public domain in the United States on January 1, 2024, almost 100 years after his 1928 debut in the short film Steamboat Willie. Mickey’s arrival highlighted the increasingly wide annual observance of “Public Domain Day”—the day when creative works enter the public domain for the first time, after the expiration of their copyright terms. This date, however, is not international, and depends on the copyright laws of each country. In Vietnam, Mickey Mouse had been in the public domain for years. Vietnam’s public domain regime Under Vietnam’s IP Law, the duration of copyright protection for moral rights is indefinite, except for rights to publish the works, which, together with economic rights, have a protection term of 75 years from first publication for cinematographic works, photography, applied art, and anonymous works. When these works are not published within 25 years from the date of their creation, the protection term is 100 years from the date of creation. For anonymous works, the protection term is determined when information about the author becomes available. For other types of copyrighted works (such as literary and musical works), following the Berne Convention, the protection term is for the life of the author and 50 years after the author’s death. Works for which the terms of protection have expired belong to the public. Everyone is entitled to use such works but must respect the moral rights of the authors. According to these regulations, Steamboat Willie and two other 1928 Mickey Mouse shorts, which are regarded as cinematographic works, have been in the public domain in Vietnam since 2003. This means that, for the past 21 years, anyone could legally copy, publish or distribute those shorts in Vietnam, and could
Read More
December 21, 2023
Can rights holders record trademark and brand-related IP information with customs and, if so, how? Rights holders can record their registered marks with the Myanmar Customs Department to protect their intellectual property rights from cross-border trade in counterfeit goods bearing their registered marks under the Trademark Law, which came into force on April 1, 2023. Furthermore, regardless of whether they have filed a customs recordation, registered mark owners can request a suspension order to prevent the release of goods into free circulation if they have evidence giving reason to suspect that counterfeit goods are being—or will be—imported into the country, in accordance with Section 68 of the Trademark Law’s. According to Ministry of Planning and Finance (MOPF) Notification No. 50/2023, once a trademark is registered under the Trademark Law in Myanmar, the registered mark owner is entitled to apply for a customs recordation with the Customs Department directly or via a legal representative at no cost. Unless the mark is registered with the Intellectual Property Department (IPD) under the Trademark Law, a customs recordation or suspension order cannot be applied. A customs recordation is valid for two years from the date of the application’s acceptance. The recordation can be renewed every two years, 30 days before the expiration date. After the customs recordation is made, any information amended or withdrawn for the registered mark at the IPD must also be provided to the Customs Department within three working days, together with any necessary documentation reflecting the amendments or withdrawal. Customs recordation is not available for industrial designs. The Industrial Design Law and Industrial Design Rules do not provide the requirements and process for a customs recordation or suspension order in relation to industrial designs. Section 68 of the Industrial Design Law indicates that, upon a rights holder’s request, the
Read More
December 15, 2023
As part of its membership in Lex Mundi, Tilleke & Gibbins has published an updated edition of its Guide to Doing Business in Thailand for 2023. This guide outlines the key factors for starting and operating a business in the Thai market. Issues covered include: Investment incentives Financial facilities Exchange controls Import and export regulations Structures for doing business Requirements for the Establishment of a Business Operation of the Business Cessation or Termination of the Business Labor legislation, relations, and supply Tax Immigration requirements This publication is part of Lex Mundi’s Country Guides series prepared by member firms in more than 100 jurisdictions worldwide. The guides serve as a useful resource for planning international business strategy and researching new markets. The full Guide to Doing Business in Thailand is available through the button below.
Read More