For some years now, Argentine Customs has been treating counterfeiting and piracy as a serious threat to its economy and to the health and security of people. In 2011, the WCO recognized these efforts by awarding Argentine Customs a special prize for demonstrating its outstanding commitment to combating this scourge. This article gives an overview of the strategy adopted to enhance its enforcement capacity and of the latest developments in this domain.

Argentine legislation incorporates the provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights[1] (TRIPS Agreement), including its special requirements related to border measures. In accordance with Article 51: “Suspension of Release by Customs Authorities”, the Customs authority must detain goods imported for free circulation which are suspected of being counterfeit trademark or pirated copyright goods if the right holders of the goods have requested an “application for action” (AFA).

Going beyond the provisions of the TRIPS Agreement, Argentine law prohibits not only the importation of counterfeit trademark and pirated copyright goods but also all types of transactions such as exportation and transit/transshipment operations involving such goods, while also granting protection to other intellectual and industrial rights.

Moreover, Customs has the competency to act on its own initiative^[1] (ex officio procedure). In such cases, the right holder is notified of the detention of the goods, providing him with the opportunity to submit an AFA. However, Customs can also decide to detain the goods and to prosecute the infringer.

Argentine law does not consider the parallel importation[2] of genuine merchandise as a trademark infringement. However, in certain cases, it may constitute a breach of contract in the country of origin of the products or a violation of other local laws, on the basis of which the importation can be prevented through a judicial order.

To make the procedure more efficient and faster when it comes to protecting trademarks, the Argentine Customs Administration (DGA) has developed an IT tool called “Sistema de Asientos de Alerta”, or “Alert Entry System”. It enables companies that hold an intellectual right registered at the competent national authority^[3] to submit AFAs. Submission is free and is valid for two years. Currently, 316 trademarks and AFAs are registered on the platform. The right holders are required to provide the DGA with the necessary information to identify the merchandise. The DGA will then enter into the Sistema Informático Malvina (SIM) – the software used to manage international trade operations – the tariff position of the IP protected goods and the fiscal numbers of their right holders.

When an economic operator declares an import or export operation in the SIM related to a merchandise whose tariff position is covered by an AFA, he must choose from among a list of trademarks registered in the Alert Entry System. If he selects one of them, the SIM will block the operation for 24 hours and issue alerts to the competent Customs unit (in this case, the Trademark Fraud Division) and the right holder. Customs and the right holder can then carry out a physical verification of the merchandise. If the declarant does not select any of the trademarks registered in the Alert Entry System, he must indicate the trademark of the good he intends to import or export in the SIM, or state that the good does not have a trademark, as the case may be.

The usual practice, when counterfeiting merchandise is detected, is for importers simply to abandon it for destruction.

The implementation of the Alert Entry System had a significant impact on IPR enforcement. Having access to technical information related to the genuine goods and undertaking joint inspections together with the right holders greatly helped identifying counterfeit trademark goods.

The Trademark Fraud Division was established in 2006 as a specialized unit to work on enhancing Customs’ capacity to detect IPR infringing goods and to manage the Alert Entry System. Currently, this unit has 25 officials whose task it is to monitor transactions presenting risks and guide operational controls with constant interaction with the right holders.

As front-line Customs officers are also engaged in the protection of IP, they need to be regularly trained with the support of right holders. An understanding of product specifications and supply chain planning can help them identify suspicious shipments. In such cases, they report information to the Trademark Fraud Division who will take over and arrange inspections if needed.

Training activities sometimes include the participation of other enforcement agencies and representatives of the judicial system, such as judges and prosecutors. Argentine Customs is proud to count a number of IPR Accredited Experts among its staff and to be able to support the WCO Secretariat’s technical assistance activities.

Argentine Customs has also participated in several WCO enforcement operations targeting counterfeiting and piracy; these offer the Customs Administration great opportunities to train its staff and test their capacities as well as the efficiency of its processes. Moreover, WCO operations enable the Administration to have access to actionable information which it shares with and receives from other Customs administrations, evaluate the strategy in place based on the results obtained and identify new modi operandi and trends that should be closely monitored.

A category of shipments on which the Administration is placing increasing emphasis are those transported by postal operators and express courier services. These shipments must be declared through the Customs computer system.

Both service providers declare the goods in place of the importer/consignee and are responsible for collecting the revenue. However, the importer/recipient of the goods must notify the reception of the goods to Customs, through the Customs computer system (if they do not do so, they will not be permitted to receive further shipments).

The express courier service operator presents a simplified declaration indicating the details of the seller and the recipient, the origin and provenance, the value and a description of the item(s). The clearance process differs for the national postal operator (official post) who must submit one of the CN forms; however, the importer/recipient must also make a simplified declaration indicating the value and a description of the shipment(s). In both cases (express courier / national postal operator), the identity of the importers is known to the Customs Administration. It should be noted that, in order to carry out operations in the Argentine Customs computer system, personal and biometric data must be provided.

As the volume of these “small shipments” is increasing exponentially, control is a challenge. Currently, the risk profile of this type of operation is based on the analysis of key data in the Customs declaration such as the origin of the goods and the itinerary used to transport them, as well as the names and addresses of the suppliers and importers. In addition, the Customs Administration works in cooperation with e-commerce platforms in order to obtain more data on the operations analysed.

In the case of express courier services, the principle of selectivity applies. This is also the case for shipments transported by national postal operators for which there are two processing channels: circuit 1, in which the Customs service inspects the merchandise prior to its release, and circuit 2, in which the shipment is delivered directly to the importer’s address. However, all shipments transported by postal operators are subject to inspection by non-intrusive methods (e.g. scanner).

Moreover, if the shipment is deemed suspicious, an inspection is carried out by Customs canine teams to determine the presence of prohibited substances.

Free zones (FZs) pose additional challenges for the Administration. They are commonly used by infringers to repackage, label and relabel products. Trade operations within the zones can also make it difficult to track the origin of the cargo, especially when products are sold successively with the involvement of intermediaries.

The free zones do not affect the whole of the Argentine Customs territory: they are simply designated areas in which the general regime of taxes or prohibitions does not apply. Special control strategies have been created for those goods coming from or destined for these areas that have been authorized to operate as free zones in Argentina.

The Customs Service is present in the area 24 hours a day, 7 days a week, and has the right to carry out scheduled or random checks of the premises and inventories of the companies located there. Goods entering the zones must belong to a registered company. Imports and exports, as well as transit operations between the zones, are managed through the automated Customs system, as well as through the tax administration information system. Specific risk indicators designed to address the most common risks in export processing zones (EPZs) have been incorporated into the Customs’ risk engine. For example, when goods are imported from a free zone, their exit point must be indicated on the Customs declaration.

[1] Domestic Law No. 24.425.

[2] Domestic Law No. 25.986 and amending Law No. 26.458.

[3] Parallel imports (or grey market goods) refer to branded goods that are imported into a market and sold there without the trademark owner’s consent in that market.

[4] National Institute of Intellectual Property (INPI). Law No. 24.481.