In order to strengthen the destruction of infringing and counterfeit products, Office of the National Leading Group on Fight against IPR Infringement and Counterfeiting, Publicity Department of the Communist Party of China, the Supreme People’s Court, the Supreme People’s Procuratorate, the Ministry of Public Security, the Ministry of Ecology and Environment, the Ministry of Culture and Tourism, General Administration of Customs and the State Administration for Market Regulation have jointly formulated and issued on August 13, 2020 the “Opinions on Strengthening the Destruction of Infringing and Counterfeit Products” (“the Opinions”).

The Opinions underscore that the infringing and counterfeit goods shall be prohibited from re-entering market circulation through importation, exportation or other customs procedures.

The Opinion offers the following takeaways:

Infringing and counterfeit goods and the materials, tools, marks, labels, certificates and packagings mainly used to manufacture counterfeit or pirated goods are subject to destruction.

The timeframe for destruction hinges on the nature of the proceeding. In case of criminal proceeding, where the accused is convicted, the judiciary, except under exceptional circumstance, shall address in its decision the matter of destruction, and the infringing and counterfeits goods, as well as the material, apparatuses, molds and other tools mainly used to manufacture the aforesaid goods are to be destroyed by the competent authority within 6 months since the entry-into-force of the judgment. Where the judiciary acquits the accused or the procuratorate drops the prosecution or rescinds the case, yet the act of the accused constitutes an administrative offence, the aforesaid goods, material, apparatuses, molds and other tools shall be transferred to the administrative enforcement authority for disposal. In case of administrative enforcement, reconsideration or litigation proceeding, the administrative enforcement authority shall make a decision on the disposal of such goods within 6 months since the date of serving an effective administrative punishment decision, an administrative reconsideration decision or an administrative ruling/decision.

In terms of costs, the Opinions clarifies that the storage, transportation and disposal costs of the infringing and counterfeit goods should be included in the government budget. Except otherwise provided by laws or regulations, such expenses shall not be borne by the right holder.

It is regrettable that the Opinions provide no guarantee as to the presence of right holders to supervise the on-site destruction, though it is up to the administrative authority’s discretion whether to invite IP right holders to WITNESS the process.

Contributed by: Li Ma