Lebanon

Legal framework

National

Lebanon is a parliamentary republic and a civil law jurisdiction. Its legal system is based on substantive and procedural codified laws.

The following are the main texts governing trademarks and service marks in Lebanon:

• High French Commissioner’s Ordinance 2385/LR of January 17 1924 (Sections 68 to 88 and 105 to 110);
• the Penal Code of March 1 1943 (Sections 701 to 721, which are consistent with Ordinance 2385/LR);
• Resolution 83/A/57 of January 29 1960 on the conditions required for a foreign trademark to be registered in Lebanon (ie, to establish a Lebanese industry or business);
• Resolution 392/A/244 of July 7 1960 relating to trademarks applied to products sold in Lebanon;
• Section 20 of Law 89/1991, modified by Law 707/2005, on duties and fees due to the publication of industrial designs, patents and literary and artistic property in the Official Gazette;
• the Copyright Law (75/1999);
• the Patent Law (240/2000); and
• the Consumer Protection Law 659/2005.

In November 2007 a bill seeking to amend and modernise Ordinance 2385/LR and the provisions of the Penal Code that relate to trademarks was introduced into Parliament.

International

Lebanon is a signatory to the following conventions:

• the Paris Convention for the Protection of Industrial Property;
• the Madrid Agreement for the Repression of False or Deceptive Indications on Goods;
• the Nice Classification;
• the Berne Convention for the Protection of Literary and Artistic Works; and
• the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations.

Parliament has passed a law authorising the government to join the World Intellectual Property Organisation (WIPO) Copyright Treaty and the WIPO Performances and Phonograms Treaty. However, a new law is being considered by Parliament to correct some of the inaccuracies in the previous law. Once the new law is enacted, Lebanon will deposit the instrument of adherence with WIPO.

A bill was introduced into Parliament in November 2007 seeking authorisation for Lebanon to accede to the Madrid Protocol.

Border measures

Import and export restrictions

The Customs Law imposes restrictions on the import and export of certain prohibited goods and restricted merchandise. Restrictions may extend to:

• the passage of the relevant goods in transit;
• their storage in customs warehouses and free zones; and
• their possession and circulation.

Goods bearing false marks and labels indicating an incorrect origin are classed as prohibited and treated accordingly. They are seized on import or export, and the carriers are subject to penalties.

It is strictly forbidden to import, pass in transit, transport, export or re-export:

• products bearing false trademarks, labels or commercial descriptions that benefit from legal protection in Lebanon according to the Paris Convention and its amendments;
• products bearing false marks of origin or that are incorrectly marked or labelled to indicate, directly or indirectly, that they were produced in or originate from one of the members of or parties to the Madrid Agreement and its amendments, or an area situated in one of those jurisdictions;
• foreign products, whether natural or manufactured, marked or labelled in any way whatsoever to indicate that they were made in or originate from Lebanon;
• products that are inconsistent with the conditions prescribed in agreements, laws and regulations pertaining to the protection of intellectual property; and
• labels, signs, caps, containers and other elements incorrectly bearing the sign of a factory or store, or a commercial description or an indication of origin eligible for legal protection in Lebanon.

Penalties

The violation or attempted violation of the Customs Law constitutes a criminal offence. Thus, the import or attempted import of prohibited goods without the submission of a customs declaration or through smuggling is considered an offence punishable by seizure and forfeiture of the goods, along with a monetary fine.

The value of the forfeited goods is added to the monetary penalty, which is determined as follows:

• In cases involving the seizure of goods and means of transport used to conceal the fraud:
• from two to three times the standard duty if the seized merchandise is neither prohibited nor restricted;
• from three to four times the duty on highly dutiable merchandise, merchandise subject to revenue duty or merchandise subject to the control of the customs authorities by virtue of the decisions of the Higher Council of Customs;
• from two to three times the duty (including customs duties) on prohibited goods; and
• from one to two times the duty (including customs duties) on restricted goods.
• In cases where it would be impossible to assess the value of the goods seized, the amount of the penalty will range from between L£1 million ($667) and L£10 million ($6,670).

The offender can recover the seized goods if it is willing to remove the offending marks, labels, signs or indications of origin.

Customs procedure

Violations and attempted violations of the Customs Law are referred to the criminal courts. The customs authorities initiate criminal cases by submitting a report of the seizure to the Intellectual Property Office (IPO), the department of the Ministry of Economy and Trade charged with notifying the injured party. The seized goods may be released after the infringing marks have been removed, with the IPO’s approval.

When violations are brought before a court, the injured party may join the case as a civil party.

The losing party bears the cost of storing the seized goods.

Criminal prosecution

Section 702 of the Penal Code provides for a fine of between L£100,000 ($67) and L£1 million ($667) and/or imprisonment of between three months and three years where any party misleads consumers by knowingly:

• counterfeiting a registered mark – even if this is done by adding other elements;
• affixing on goods a trademark which is the property of another party; or
• selling and/or putting on the market products bearing a counterfeited or imitated mark.

Sections 703, 705 and 706 of the Penal Code provide for a fine of between L£100,000 ($67) and L£500,000 ($334) and/or imprisonment of between two months and two years where any party misleads consumers by:

• fraudulently imitating a trademark;
• using, selling or putting on the market a product bearing such a fraudulently imitated trademark;
• affixing on a counterfeit product any national or foreign emblems, signs, decorations, words, pictures or codes that harm public order or morality; or
• failing to affix on a product a distinctive mark as required by law.

A criminal case is initiated by either the injured party or the prosecutor. Once initiated, the case is referred to the police for investigation. Once the investigation is completed, the matter is referred to the criminal court with jurisdiction over the matter for the defendant to be tried.

Criminal charges may be brought against an individual or the manager(s) of a legal entity involved in counterfeiting activities.

The investigation usually takes between one week and one month from the date on which proceedings are initiated. The trial court takes approximately two years to hand down its decision.

Section 705 of the Penal Code provides that the judge can order the seizure of counterfeit goods even before handing down his or her decision.

Civil enforcement

A trademark registration is prima facie evidence of ownership and a basis for enforcement. Any prior users should petition the court to remove an illegally registered mark within five years of the date of registration. Once that period lapses, trademark ownership may not be challenged on the grounds of prior use, unless it is proven in writing that the registrant knew of the existence of the prior use at the date of the filing of the application to register the trademark. Evidence of prior use should always consist of written materials.

Registration grants the rights holder the right to institute infringement actions. Owners of unregistered trademarks may file unfair competition suits only.

Unfair competition proceedings may lead to:

• cessation of the acts of unfair competition;
• prevention of damage caused by such acts; and
• compensation for damages sustained.

The courts have full discretion to decide whether an act of competition is unfair.

The courts are required by law to assess counterfeiting from the point of view of the ordinary consumer, taking into account the overall similarities between the original and counterfeit products, but without taking into consideration any minor differences between them.

The rights holders may request:

• cessation of the infringing activities; and
• destruction of counterfeit goods.

In certain situations, where infringement is imminent and easy to prove, the owner of the original product or trademark can petition the judge to obtain a temporary injunction to stop the offending activity.

Anti-counterfeiting online

Although current laws and regulations do not cover all aspects of online infringement, the general rule of law and the IP laws apply to such infringements.

Contractual solutions and alternative dispute resolution under the Uniform Domain Name Dispute Resolution Policy Rules may serve to resolve conflicts between domain names and trademarks. The rules on unfair competition also apply to disputes over domain names.

Sections 701 and following of the Penal Code and Sections 105 and following of Ordinance 2385/LR cover all aspects of trademark infringement, including counterfeiting and usurpation of a brand name.

Sections 121 and following of the Code of Obligations and Contracts may also provide, to some extent, a legal basis for claims relating to the illegitimate registration of a domain name, because of the general reference made in these provisions to the notions of fault, negligence and good faith.

Preventive measures/strategies

The IPO can investigate acts of alleged counterfeiting. IPO inspectors can:

• enter the premises where the suspected infringing activity is taking place;
• examine suspected counterfeit goods;
• take samples; and
• seize the offending goods and leave them with the owner of the outlet as a judicial custodian.

The inspectors then prepare a report, which may be sent to the prosecutor for further action. The owner of the original product or trademark has 15 days from receipt of the report to initiate a criminal complaint.

Use of local counsel and investigators

There is a lack of knowledge of the IP laws at the judicial level – and even among lawyers in general. Therefore, the use of local counsel experienced in IP matters is recommended in counterfeiting matters, to help explain to the court and the police the various legal issues involved in the case.

Private investigators are not allowed to operate in Lebanon. Therefore, it is impossible to hire a professional investigator to obtain certain basic information before taking action against the infringer. Such investigation is done by the police after the criminal complaint has been filed.

Other measures

The Ministry of Economy and Trade has made efforts to fight infringement by establishing a consumer hotline for reporting acts of counterfeiting. In addition, the ministry has prepared and distributed brochures explaining the various IP laws available in Lebanon. Further, it has launched a website featuring information that is relevant to both consumers and rights holders.

Cooperation with national anti-counterfeiting agencies

The Ministry of Interior recently established a cybercrime police unit which specialises in the investigation of offences committed on the Internet, including the violation of IP rights. This unit is active and relatively well trained. In addition, the customs authorities are keen to combat all acts of counterfeiting and piracy.

Walid Nasser

Partner

[email protected]

 

Walid Nasser is a partner and founder of Nasser & Associates Law Office. He holds law degrees from Saint Joseph University in Beirut, a Diplôme des Etudes Approfondies from Jean Moulin University, Lyon, France and an LLM from Harvard Law School. He deals primarily with IP matters and represents the four major industries that thrive on intellectual property – film, software, music and pharmaceuticals. He also represents major Middle Eastern broadcasters and production companies.