Hong Kong
Combating Counterfeits, Strengthening Cross-Border Enforcement
In Hong Kong’s fast-paced market, IP protection is a battle against counterfeits and infringement. Backed by key ordinances, enforcement relies on civil lawsuits, criminal enforcement by Hong Kong Customs, and court rulings, challenges remain with counterfeit goods from Mainland China. But the 2024 Mainland Judgments Ordinance strengthens cross-border enforcement, ensuring a future of stronger IP protection.
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A. Legal Framework
The primary legislations governing IP enforcement in Hong Kong are as follows:
a. Copyright Ordinance: This ordinance protects literary, dramatic, musical, and artistic works;
b. Trademarks Ordinance: This ordinance protects brands and logos;
c. Trade Descriptions Ordinance: This ordinance prevents misleading trade practices, and is often relied upon by Hong Kong Customs in trademark enforcement matters;
d. Patents Ordinance: This ordinance protects inventions; and
e. Registered Designs Ordinance: This ordinance protects the visual designs of products.
The following legislations may also be relevant:
a. Prevention of Copyright Piracy Ordinance: This ordinance sets out a statutory licensing scheme for the production of optical discs in Hong Kong, and empowers Hong Kong Customs to monitor optical disc manufacturing plants in Hong Kong;
b. Plant Varieties Protection Ordinance: This ordinance ensures breeders’ rights over new plant varieties; and
c. Layout Design (Topography) of Integrated Circuits Ordinance: This ordinance safeguards the design of integrated circuits.
Please also note the common law action of passing off, which is akin to unfair competition in other jurisdictions. An action of passing off occurs when a trader unlawfully misrepresents that their goods or services are those of another trader.
B. IP Enforcement Mechanisms
a. Civil Enforcement: The primary method of enforcement in Hong Kong is civil enforcement. Initial steps normally involve issuing a cease-and-desist letter to the infringer. Thereafter, the brand owner may proceed with a civil suit filed with the Hong Kong courts.
b. Criminal Enforcement: Hong Kong Customs is the relevant department in charge of criminal enforcement of copyright and trademark infringement in Hong Kong. Brand owners can file complaints with Hong Kong Customs, who will then conduct their own investigations and initiate criminal proceedings where necessary.
c. Administrative Enforcement: There is no government administrative enforcement in Hong Kong.
The Court of First Instance of the High Court has unlimited jurisdiction to hear all civil IP claims. Since the Court of First Instance’s IP specialist list was established in 2019, almost all civil IP claims have been filed with the High Court. On the other hand, the District Court also has jurisdiction to hear some civil IP cases limited to a value of up to HK$3,000,000 (around US$385,000).
As for criminal IP cases initiated by Hong Kong Customs, these are brought before the Magistrates Court or the District Court. (Note: criminal prosecutions can also be brought before the High Court, but this is extremely rare.) Appeals from the Magistrates Court can first be made to the Court of First Instance of the High Court, and then to the Court of Final Appeal (with leave). Appeals from the District Court can first be made to the Court of Appeal, and then to the Court of Final Appeal (with leave)
C. Remedies and Penalties
The following remedies are available for IP infringement:
a. Injunctions (interim and permanent): Note that interim injunctions are available if (i) there is a serious issue to be tried, (ii) monetary compensation would not be an adequate remedy for the IP owner, (iii) the IP owner can compensate the infringer and other affected parties for any loss or damage arising from the granting of the injunctive relief, and (iv) the balance of convenience favours the granting of an injunction;
b. Damages;
c. Disclosure of information;
d. Delivery up;
e. Account of profits; and
f. Recovery of legal costs.
a. Copyright Ordinance: Pursuant to Section 119, a person who commits a criminal offense of making or trading in goods that constitute copyright infringement is liable to a fine of up to HK$50,000 (around US$6,420) in respect of each infringing copy and four years of imprisonment, or a fine of HK$500,000 (around US$64,200) and eight years of imprisonment, depending on the type of infringing activity committed.
b. Trade Descriptions Ordinance: Pursuant to Section 18, any person who commits an offense under the ordinance is liable to:
i. indictment conviction, a fine of up to HK$500,000 (around US$64,200) and five years of imprisonment; or
ii. summary conviction, a fine of up to HK$100,000 (around US$12,820) and two years of imprisonment.
For civil cases, it is for the winning party to decide when and how it would be best to enforce a favourable judgment.
The winning party may seek to enforce a favourable judgment by applying for a charging order, examination order, writ of execution, stop order, etc., and/or commencing garnishee proceedings, winding up/bankruptcy proceedings, etc.
Failure to comply with a court order may constitute a contempt of court, and the winning party may apply to the Court for an order to impose a fine and/or imprisonment on the infringer for their breach of the court order.
Criminal enforcement is carried out by Hong Kong Customs.
D. Alternative Dispute Resolution
Yes, alterative dispute resolution mechanisms are available for civil IP cases in Hong Kong.
The Arbitration (Amendment) Ordinance 2017 clarifies that all disputes over IP rights may be resolved by arbitration. Arbitration proceedings can be conducted through the Hong Kong International Arbitration Centre.
Mediation is also possible although this is a voluntary process.
Hong Kong is a leading centre for arbitration and dispute resolution in the Asia-Pacific region. The abovementioned mechanisms are highly effective, and are often preferred as they can help disputing parties reach a resolution more quickly (as compared to civil litigation) and maintain confidentiality.
F. Emerging Challenges
The main challenge Hong Kong faces in enforcing IP rights against counterfeit goods is that counterfeit goods found in Hong Kong often originate from Mainland China, and cross-border enforcement of favourable Hong Kong decisions in Mainland China is often an onerous task.
The Mainland Judgments in Civil and Commercial Matters (Reciprocal Enforcement) Ordinance, which came into effect in January 2024, helps address this issue to some extent. This ordinance expands the scope of applicable judgments, expressly including judgments relating to specified IP rights.
G. Future Trends
Going forward, we expect cooperation between Hong Kong and mainland China to increase, which should help enhance the ability of IP owners to enforce favourable Hong Kong decisions in mainland China.
The Authors:
Helen Tang
Partner, East IP
[email protected]
Helen Tang’s practice focuses on regional trademark prosecution work, strategic planning and management of international trademark portfolios; providing advice on protection and enforcement of intellectual property rights, trademark oppositions and revocations; trademark audits, licensing and acquisitions. Helen has represented multinational and Asia-based clients in a wide range of industries, including F&B, fashion, cosmetics, entertainment, personal care products, sports and leisure, pharmaceuticals, electronics and industrial designs.
Jeremy Chiu
Partner, East IP
[email protected]
Jeremy Chiu regularly assists multinational corporations across a wide range of industries, including cosmetics, fashion and luxury goods, F&B, sports, and tech, on mainland China, Hong Kong, and global IP matters. Jeremy has experience with trademark prosecution work, contentious trademark registry matters, online and offline brand protection, customs complaints and seizures, and drafting and advising on commercial IP documents.
Disclaimer: The following article is intended for general informational purposes only and should not be interpreted as legal advice by East IP Limited. The viewpoints expressed herein do not represent the official legal stance of any of these firms. Consequently, the firms cannot be held accountable for any actions taken by individuals who use this article for purposes other than those for which it is intended.
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