Controlling Imports In Myanmar.
Legal News & Analysis - Asia Pacific - Myanmar - Intellectual Property
10 October, 2017
After a period of noticeable inactivity, revised drafts of the trademark, design, patent, and copyright bills were submitted to parliament and consequently published for public review in late July and mid-August, prompting speculation that the bills will be passed sooner rather than later.
We maintain, however, that any estimate on when the new laws will be passed remains tentative at best, and even then, details concerning how these laws will actually be implemented are even more uncertain. All said, there is still a great deal of uncertainty around the new laws and relying on existing legal options that are currently in place may be the more prudent approach.
At the same time, anticipation amongst brand owners for new IP laws can perhaps be rivalled by the market's own enthusiasm to try "new" products and services never before available in Myanmar. For many, these first impressions of a brand on eager consumers can make or break entry into the country.
Unfortunately, counterfeiters are in the race too, and the reality is that brand owners are not always the ones to break ground in Myanmar. When this happens, the customer experience can become muddled and the relationship confused such that it ultimately affects brand loyalty -- hardly an ideal first impression in an emerging market.
It may therefore be worth considering having an import control strategy in place to protect future business prospects for companies who do not yet have a presence in Myanmar and safeguard existing relationships for those that do.
Current Border Control Options
The Sea Customs Act (1878) expressly prohibits the importation of goods bearing counterfeit trademarks into Myanmar, and this border control measure is actively enforced by the Myanmar Customs Department.
To help effectuate the Sea Customs Act, the Customs Department accepts the recordal of trademarks that have been registered in Myanmar, which assists border control officials with spotting and detaining counterfeit items. This is an often-overlooked brand protection option in Myanmar, one which it seems many may not be aware is available since only a few trademarks have been recorded.
The general requirements to record trademarks with the Myanmar Customs Department are as follows.
- Duly-completed application form and application letter
- Distributorship Agreement between the rights owner and a Myanmar distributor
- Authorization letter allowing the trademark to be recorded with Myanmar Customs and confirming that the distributor named in the distributorship contract is permitted to import covered goods in Myanmar (requires notarization and legalization)
- Power of Attorney designating an attorney-in-fact to represent the rights owner at the Customs Department (notarized and legalized)
- Proof of registration of the subject trademark in Myanmar (i.e., the Declaration of Ownership of Trademark and the corresponding Cautionary Notice covering the registration)
- Samples of the trademark and the products with which they are used
Recorded trademarks shall form part of a register kept by the Customs Department, which is used as reference by border control officers when inspecting goods at the border.
Following recordal of a trademark, it is recommended that the rights owner conduct product identification training sessions for Customs officials. During such training sessions, border control officers can learn about the products on which the mark is used, helping them better distinguish fake products from genuine products. These product identification techniques are often particularly helpful for officers in the field.
Training sessions can be scheduled upon request and subject to the availability of Customs officers.
Business Representative Registration
This border control strategy would work best if local distributors have also secured their own regulatory clearances, such as valid and up-to-date import licenses and other registrations with the relevant authorities. Failure to comply with any of these requirements may expose the strategy to challenge on technical grounds for non-compliance.
One such requirement to consider is the Business Representative registration of the local distributor with the Ministry of Commerce. Registrations are assessed on a case-by-case basis.
Substantial changes are expected when the new IP laws do take effect, one of which is the reinforcement of Myanmar's border control powers.
The draft trademark bill, for example, expressly empowers the Customs Department to issue a Suspension Order, which is akin to an injunction order establishing a temporary period during which suspected counterfeit goods can be detained, thereby allowing for a more thorough inspection such goods. The law also establishes specific procedural steps and requirements for allowing, lifting, and challenging the Suspension Order. Effectively, the new laws should provide procedural clarity not presently available under the current system.
It must be noted that the draft trademark bill has undergone several rounds of revision, but the border control measures included in the bill have remained substantially intact between drafts. As such, now that the latest and ostensibly final draft of the bill has been submitted to parliament and is due for a vote, we anticipate that these powers will all be included as previously reviewed in the enacted law.
Of further note, the draft trademark bill itself does not establish a procedure for the recordal or registration of trademarks with the Customs Department, which suggests that further revised regulations may be issued on this point.
Passage of the trademark law will certainly enhance border control protections against the entry of counterfeits into
Myanmar. However, it's important to note that there are already viable options available to achieve this objective, and they're worth considering as part of a comprehensive brand protection strategy in Myanmar.
In the meantime, Myanmar's parliament has adjourned its sessions on 31 August, and no further developments on the bills can be expected until the sessions resume on 17 October. Several of our contacts also estimate that the Trademark Bill, along with the other IP bills, will be passed within this year, but it is still difficult to provide an accurate estimate at this stage. We will continue to closely monitor the progress of these laws and issue updates accordingly.
For further information, please contact:
Say Sujintaya, Partner, Baker McKenzie
See our full Doing Business In Myanmar Report via this link. https://www.investingmyanmar.com