§ 10.14 p.m.
§ That the Trade Marks (Customs) Regulations 1970 (S.I., 1970, No. 212), dated 13th February 1970, a copy of which was laid before this House on 20th February, be withdrawn.
§ In moving this Motion I must say how sad we all are that my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) is not with us. He is the expert on this matter, and it was he who would have moved this Motion had he not been overtaken by illness. The point that he wished to make is one of considerable substance and one which is worthy of a brief discussion, because it is matter affecting a large number of people who have trade marks and have been accustomed to thinking that the trade marks would be protected by Her Majesty's Customs from foreign breaches, due to foreign imports bearing bogus or forged trade marks of the products they were imitating.
§ This matter was discussed in Committee on the Trade Descriptions Act 1968, and an Amendment was moved to Section 17, which was the governing Section of the parent Act. That Section goes to one extreme of the position. It is under that Section that these regulations are laid before the House. It is fair to say that there are two extreme positions here. There is the extreme represented by these regulations, and there is the extreme which has been represented by past practice. Past practice derives from the Act of 1911, since when it has been the duty of the Customs and Excise to watch out for and intercept any goods entering the country which infringed a United Kingdom trade mark and impound those goods and keep them off the British market.
§ It is right and proper to accept that it has never been possible to enforce this position. It did not work in practice 374 because Customs was unable to know what goods infringed which trade mark and had no knowledge of the impending arrival of goods which infringed an existing trade mark. As the then Minister of State, the right hon. Member for Sheffield, Hillsborough (Mr. Darling), said, there was no record of the procedure ever having been invoked. Such a procedure is one that neither side of the House could possibly recommend. My hon. and learned Friend recognised this in his speech. I do not think that anyone would want to pretend that it was possible to work the old procedure, whereby the Customs had the overall duty of protecting British trade marks against foreign breaches, wheresoever and howsoever they arise.
§ The Act and the regulations which arise out of Section 17 of the Act go to the other extreme and require a person holding a trade mark to give detailed information about any impending breach of the patent or trade mark which he holds and to pay specifically for the service of apprehending goods imported in contravention of the trade mark. I do not think that the holders of trade marks will object to having to pay for the service, but if they are to do so then the service must be manifestly effective and useful.
§ The complaint I raise against these regulations is that the information which it is required should be provided to the Customs is far beyond the knowledge of anyone who holds a trade mark. The regulations give a draft form which has to be filled in. Apart from a lot of procedural questions, the patent holder or trade mark holder has to give the name of the ship, the flight number of the aircraft, the name and address of the importer, a description of the goods—including Customs tariff classification—and the number of, and marks on, packages.
§ If a foreign exporter is trying to send goods into this country in contravention of a United Kingdom trade mark, he will not be able to tell the holder of the trade mark what the package number will be, in which ship the goods will arrive and at which port. It is manifestly absurd to expect somebody to have this information and be able to pass it on to the Customs. It will be impossible to invoke these regulations to protect one's trade mark just as it has been impossible to invoke the previous regulations. It is 375 not sensible to go as far as the regulations go.
§ Action is limited to individual consignments coming through a particular port. Supposing an exporter who was in contravention of a British trade mark were trying to get his goods in through many different ports in many different consignments over a period of years, it would be manifestly impossible for the holder of the trade mark to be able to inform the Customs of each specific consignment coming to each specific port on each specific date of import. It is going too far for these regulations to be drawn so tightly.
What my hon. and learned Friend suggested in Committee, and what I now propose, is that it would have been much better to have a compromise between these two extreme positions. My hon. and learned Friend said:
What I suggest as a compromise, and I would very much like the Government to consider it between now and Report, is that the owner of a British trademark should file a statement of case aimed at satisfying the Customs authorities that there is a real and continuing risk of the trade mark being improperly used on goods imported, but that he ought to specify the country or the group of countries and he ought also, if possible, to set out instances of what wrong importation has actually happened and also closely specifying the nature of the goods."—[OFFICIAL REPORT,Standing CommitteeA, 28th March, 1968; c. 267.]
§ This is a much more sensible way of going about it. Where the owner of a British trade mark has reason to believe that there will be an attempt to undersell him with a bogus trade mark, he should ask the Customs to watch out and give the necessary information, but details of the port, the flight number and the numbers of packages of goods which are expected is more than he can ever expect to know.
§ I hope that the Financial Secretary will be a little more specific about how the Customs will deal with this matter. Will it maintain the duty which has been upon it hitherto to watch out for the interests of British trade mark holders, whether or not it has been tipped off in this form of the exact time, place and method of importation? That is the duty which this House has previously put upon it. There has been a general duty to protect British trade marks and to offer 376 a service to holders of the trade marks which will protect them. If they are now to be asked to pay for this service, to which I raise no objection, at least the service must be slightly more reliable and more helpful to the owner of the trade mark than has hitherto been the case.
§ I do not want to absolve the Customs from its general duty to protect British trade marks, and I do not think it is right that it should be allowed to get out of it simply by saying that the proper particulars have not been filled in. In most cases it is quite impossible for the owner of the trade mark to know when these goods will come and where they will come to.
§ I hope that the Financial Secretary will give us a little information about how this will be administered. It is clearly part of the duty of Her Majesty's Customs to watch out for the infringement of trade marks, and to make certain that there is no underselling of British trade marks which it could prevent. I hope that the Financial Secretary will consider the compromise suggestion put forward by my hon. and learned Friend in Committee and will also tell us what the attitude of the Customs will be. Otherwise, it would appear that the British Government are abrogating any responsibility for enforcing trade marks, although they have a responsibility for granting them. This would be a serious reduction in the standard of service which is offered.
§ 10.25 p.m.
§ The Financial Secretary to the Treasury (Mr. Dick Taverne)
Some of the matters which the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) has raised were debated in Committee, and it would be wrong to go over them again. In any event, they were dealt with then by Ministers of the Board of Trade, who are more familiar with this territory than I am.
Like the hon. Member, I am extremely sorry to hear that the hon. and learned Member for Darwen (Mr. Fletcher-Cooke) is ill. I am sure that the House would have profited from his considerable knowledge of this matter.
We have to distinguish between the Act, which we cannot debate now, and the regulations. The first thing is that 377 the House must be clear what the regulations are about. All they do is implement the Act and assist the owners or proprietors of trade marks in seeing what their obligations are and what course is open to them under the Act.
Section 17 of the Act specifically provides that a person who is the registered proprietor or the registered user of a trade mark may give notice in writing to the Commissioners of Customs and Excise, first, that he is the proprietor or registered user of that trade mark, and, second, that goods bearing the trade mark are expected to arrive in the United Kingdom at a time and place and by a consignment specified in the notice, and that its use is an infringement of his exclusive right. He then asks the Commissioners to treat the goods as prohibited goods.
If he does that, he gets a measure of protection, but, under the Act, to get the protection, he is required to give those details, and he is specifically required in the Act to mention some of the things which the hon. Member for Cirencester and Tewkesbury complained of. He is required to mention the time of the arrival and the place of arrival of the goods and the specific consignment. He is also supposed to give notice. All the things complained of in the regulations are already provided for under the Act.
The hon. Member said that he did not want to absolve the Customs from the duty to protect trade marks, but the duty which is now laid on the Customs is the duty laid down under the Trade Descriptions Act, 1968, and this is not a matter which we can debate now.
The regulations are not required, because what the proprietor or the registered user has to do is already laid down in the Act. Many people were not sure exactly in what form they were to give the information which the Customs required before they could give the necessary protection. They were not sure how far they would have to prove the infringement of the trade mark and the ownership of the trade mark, and how they would give notice of the time and place of consignment, and so on. This is all the regulations do. They are helpful to the proprietor or the registered user. They do not impose any further obligations on him that would make his task more onerous. They show him, under Article 378 6, what he must do to prove that he has the trade mark registered; they show him what particulars of the consignment are required; and, instead of all the various traders having to ring up customers, as they now have to do, to ascertain all the details which they are required to give, they have the form which makes it simple and clear, so that they know exactly what information is required.
In courtesy to the hon. Member, since he has raised this matter, as he says, a compromise suggestion was put forward by the hon. and learned Member for Darwen. The Board of Trade, which dealt with this matter, did not find it was possible to implement this requirement. My hon. Friend the Parliamentary Under-Secretary to the Board of Trade in a letter written to the hon. and learned Member for Darwen gave the reasons, which it might be convenient to spell out.
They were as follows:We do not think that the proposed condition that trade mark owners should demonstrate a real risk of damage from the import of improperly marked goods would serve to limit drastically the extent of registration. This is not a matter which the Customs would be competent to decide and, in practice, they would be obliged to accept any request from a trade mark owner.It would not exempt the Customs from detailed examination of the goods. The customs officer would have to look at the Customs entries and supporting commercial invoices for all consignments of goods awaiting clearance and select those entries which might possibly cover goods of the particular description. The tariff and invoice descriptions would not always afford sufficient evidence.
What it came to was that the Customs would have to proceed to the kind of detailed examination of the goods inconsistent with the practice and aims of Customs which all importers wish to see achieved, with the most rapid possible clearance of goods. It was not possible to accept the compromise before Report stage.
For these reasons the duties laid upon Customs are those in the Trade Descriptions Act 1968. All the regulations do is to help the owners or registered users of the trade marks by giving specific information of what they are required to provide. I hope the hon. Member will not feel it necessary to press this matter further since I am sure that, generally 379 speaking, these regulations will be welcomed.
§ Mr. Ridley
With the leave of the House; this debate has taken place under some disadvantage in that I am substituting for my hon. and learned Friend and it appears that the Financial Secretary is substituting for the Parliamentary Secretary to the Board of Trade, whose matter this principally is.
§ Mr. Taverne
I did not want to give the wrong impression. When a matter involves Customs, it is a matter for me, but when it relates to goods it is a matter for the Board of Trade.
§ Mr. Ridley
We are both at some disadvantage.
I am a little troubled by the Financial Secretary's reply. The first point is that the name of the importer has to be substituted in these regulations. That is not included in the Trade Descriptions Act 1968. Quite clearly, this is an added onerous condition. If a competitor is trying to get goods into the country, he will not tell the owner of the trade mark the name of the importer through whom he is to work. It is one more added difficulty for him which is not in the 1968 Act.
Secondly, the Financial Secretary claimed that the Customs was loth to be concerned in the detailed examination of goods. Well, every time I come back from the Continent through London Airport the Customs are only too keen to be concerned with the detailed examination of goods. I thought it was their job to make sure that " pot " and other forms of prohibited imports were not brought into the country. If the Customs are not concerned with the detailed examination of goods, it is hard to know what they are supposed to be concerned with. If they are alerted that certain contraband or certain bogus foreign trade mark goods are coming into the country, it is their job to try to apprehend them. We all know the large volume of trade in imports, and it is impossible for Customs to soot everything. But by making the occasional special examination, they keep people on their toes and make it more difficult to contravene the various regulations. I hope 380 the Customs will not rest on the Financial Secretary's dictum that it is not their job to be concerned with the detailed examination of goods.
I was a little disappointed that the Financial Secretary did not go further to meet the point that the State has a duty to protect the trade marks granted to its citizens. In asking leave to withdraw the Motion. I can only ask that the Customs will continue to take it upon themselves to watch this matter and will not simply rely upon information being supplied to them on the form that accompanies this Order. If the latter is the case, nothing will be stopped. Protection will be abandoned entirely for the owners or managers of British trade marks, and that will be a step in the wrong direction.
I hope that the Financial Secretary will inform the Customs and Excise that we on this side of the House, at least, still believe that it has a duty to administer the Trade Marks Acts as well as to investigate the special cases which are brought to its attention.
§ I beg to ask leave to withdraw the Motion.
§ Motion, by leave, withdrawn.