What is illegal?
The rules about what is legal or illegal do not entirely correspond within the different types of immaterial rights.
In relation to trademarks, designs, patents and utility models, it is illegal to exploit the rights commercially without the consent of the rights holder. Commercial exploitation includes production, import, export, storage and marketing.
With regard to works protected by copyright, it is illegal to reproduce the work and it is also illegal to make the work publicly available.
For all rights the principle is that private use is not prohibited. Thus it is not illegal for a private person to buy a counterfeit bag and use it for private purposes.
However, within the rules on copyright, legal private use has been limited in relation to digital works. You are only allowed to copy a music CD or DVD film, if you own it. Copies must be for your own household only. Any other form of copying, participation in copying or selling of these copies is against the law. For example, you are not permitted to copy a CD and give it as a gift to your neighbour. You are also not permitted to copy a CD that you have taken out of the library. Downloads are only allowed from websites where the work has been made available with the consent of the rights holder.
It is important to be aware that right holders can demand destruction of a counterfeit good bought for private use and sent from outside the EU, when the release of the good is suspended by the Danish customs authorities (SKAT). This also applies in cases where a consumer has legally bought a counterfeit good for private use. Further information on this topic is available below.
Goods detained by SKAT when imported to Denmark from countries outside the EU
When a right holder has applied for action by SKAT in relation to goods infringing the right holder’s intellectual property rights and according to the EU Customs Regulation 608/2013, SKAT shall suspend the release of goods which SKAT suspects infringe such rights and hand over the case to the right holder without regard to the number of goods.
If the right holder finds the detained goods to be counterfeit, it will be up to the right holder to pursue the case and - if necessary - through the court system.
If the right holder chooses to pursue the case, it is relevant to determine if the import took place in the course of trade, which is illegal and can be sanctioned with criminal penalties in the form of a fine or a prison sentence, civil claims for damages and compensation for unlawful use as well as destruction of the goods. The rules on such sanctions are described more detailed below.
A possible discussion about whether or not the goods are imported in the course of trade must be conducted with the right holder, as there is no legal basis which allows SKAT to determine this question. In the last instance, it will be a task for the courts to determine – based on the concrete facts of the case - if an import has taken place in the course of trade. The number of imported goods can be an element in this assessment, but will not necessarily be decisive.
In the last instance, the competence to determine the further destiny of the goods – eg if they should be destroyed and who will then bear the costs – lies with the courts.
It is important to be aware that also counterfeit goods, which the buyer has bought legally for private use, can be destroyed upon detention by SKAT. Further information on this topic is available below.
Destruction of counterfeit goods bought for private use
On 15 May 2014, the Danish Supreme Court handed down an important judgment determining that counterfeit goods bought for private use can be destroyed, if the goods are sent from a country outside the EU and the release of the goods is suspended by SKAT according to the EU Customs Regulation 1383/2003 (now replaced by EU Customs regulation 608/2013). Prior to the Supreme Court’s judgment the European Court of Justice (ECJ) was asked to interpret the relevant EU legislation through a preliminary ruling (case C-98/13).
Building on the preliminary ruling from the ECJ, the Supreme Court determined in its judgment of 15 May that although the buyer had not broken the law by buying a counterfeit watch for his private use, the watch should nevertheless be destroyed due to the seller’s infringement of the copyright and trademark rights. The judgment and the court’s accompanying press release are available through this link (in the Danish language) to the Supreme Court’s website.
It follows from the mentioned rulings from the ECJ and the Supreme Court that right holders can – in cases where a counterfeit good is detained by customs - demand the counterfeit good destroyed based on the seller’s infringement and also in cases where the buyer has not broken any laws. If the buyer opposes the destruction – eg because the buyer claims the good is original – the right holder must institute legal proceedings against the buyer in order to determine if the good is counterfeit. If a court determines that the good is counterfeit, the right holder can demand its destruction without liability for damages to the buyer.
IPR infringers can be sentenced by the courts to pay damages. In general, damages are calculated based on the loss suffered by the infringed party, but may also include compensation for the unlawful use. Finally, damages may also cover non-financial damage.
A convicted IPR criminal may also be ordered to pay a fine or sentenced to prison. The sanctions for violating copyright law, trademark law, design law, patent law or utility model law can be an 18-month prison sentence, if the circumstances are aggravating. Severe violations are punishable by prison terms up to 6 years. This presupposes that the violation was intentional. Fines may be given in cases of gross negligence.
According to legislation on medicinal products, import and trade with counterfeit medicines is punishable by prison terms up to 18 months unless other legislation demands a more severe penalty.