COAC Reverses Course, Now Opposes Voluntary Disclosure Program for IPR Violations
The CBP Advisory Committee on Commercial Operations (COAC) is no longer on board with a long-mooted pilot program to test voluntary disclosures for intellectual property rights violations, according to documents posted in advance of the committee’s Feb. 11 meeting in San Francisco (here) and (here). The program would have instituted a disclosure process for merchandise that the importer originally thought was legitimate but turned out to be counterfeit. In draft recommendations for the upcoming meeting, COAC’s Trade Enforcement and Revenue Subcommittee now says the program should be shelved because of legal concerns, as well as a lack of benefits for importers.
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The IPR voluntary disclosure program would have worked like voluntary disclosures for Section 1592 customs violations, CBP has said (see 10081016)..Importers filing the voluntary disclosures would be eligible for relief from penalties and other enforcement action, and CBP would be able to use the information obtained from the disclosures to pursue manufacturers and other importers for IPR violations. The agency had initially expected the pilot to begin in fall 2010, but was immediately met with industry concerns upon unveiling its plans (see 10100413). Nonetheless, COAC had at its May 2014 meeting recommended CBP put together a working group to finalize details of the pilot.
However, “after consideration of the working group’s comments and CBP’s response to those comments, the COAC will be offering a recommendation at the February 2015 public meeting that CBP should not pilot the program,” said the COAC Trade Enforcement and Revenue Subcommittee. Both CBP and the trade community have concerns about potential litigation, said the subcommittee, which are compounded by a “lack of sufficient benefits for the trade about the program.” The subcommittee also noted that the program “would not be open to all industry segments, specifically parallel importers.”