April 9, 2003

Dear Sir/Madam:

The Coalition for Intellectual Property Rights (CIPR) would like to express our serious concern that on April 7, 2003 the State Duma Budget and Taxes Committee voted down the amendment to the draft Customs Code introduced by the government and a group of State Duma deputies. This amendment would provide customs agencies with the power to act at their own initiative (ex officio) and suspend the release of goods if intellectual property rights are being violated.

The introduction of this provision would significantly increase the effectiveness of intellectual rights protection, make Russian legislation consistent with Article 58 of the TRIPS Agreement, make Russia’s WTO accession easier, and most importantly – protect the interests of genuine rights holders, as well as the health and lives of consumers. Article 19 of the model law of the World Customs Organization and the Proposal of the Commission of the European Community from January 20, 2003 include similar provisions.

The practice of the majority of nations demonstrates that the more frequently customs agencies use the ex officio provision (without applications from rights holders), the more effective the anti-counterfeiting campaign is. With the extremely broad scope of counterfeit product circulation in Russia (according to the Ministry of Internal Affairs, it is 50-86 percent), the State Duma Committee has refused one of the most effective anti-counterfeiting mechanisms, having failed to give any fundamental arguments. The arguments by members of the State Duma Budget and Taxes Committee that the Administrative Law Violations Code includes provisions allowing customs agencies to make violators accountable for violating the customs legislation are hardly cogent because the Code on Administrative Law Violations does not describe the customs procedure for when customs agencies detect products bearing signs of counterfeiting.

The introduction of the ex officio provision to the Customs Code meets the state interests of the Russian Federation. This provision would allow the implementation of preventive measures for discovering counterfeit products and, as a consequence, it would reduce the scope of counterfeit product circulation in Russia.

We call upon you to seize every possible opportunity to discuss this most important amendment again.

Sincerely,

Alexander Shelemekh
Vice President
Coalition for Intellectual Property Rights