Notice of General Security for IPR Protection Released by China Customs General Administration

July 6, 2006

Recently, China Customs General Administration (the "CGA") has released No.31 Notice of 2006 regarding the general security for IPR protection, which shall take effect from July 1st, 2006. According to the Notice, where the IPR holder has made several applications during certain time period for detaining the imported / exported products which are suspected to infringe his trademark rights already recorded at the CGA pursuant to Article 16 of the “Rules”, he can deposit a general security at the CGA. An application for depositing general security shall be filed in written form. The amount of the general security should be equal to the total amount of the expenses deposited to the Customs by the applicant during the last year for warehousing, safekeeping and disposing the suspected infringing products after they were detained by the Customs. Where the IPR holder did not lodge an application for detaining goods with the Customs in the last year or the total amount of the expenses for the last year is less than RMB200,000, the amount of the general security shall be RMB200,000. The letter of the general security shall remain valid till June 30 of the next year from the date of execution by the guarantor. From the date of CGA's approval of the general security to December 31 of the same year, the IPR holder need not deposit any security when applying for detaining the suspected infringing products before Customs.

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