GACC Customs Recordation Procedures for Intermediate Component Seizure Actions
Record intermediate component patents and authorized supplier codes with GACC to execute immediate border seizures against unauthorized vendor exports.
Intermediate Component Infringement
Meaning
Intellectual property violations can arise within the manufacturing process even if the finished product is never sold in the domestic market. When a factory produces an unlicensed subassembly, it commits an intermediate component infringement by exploiting protected technology during assembly. This liability attaches regardless of whether the final product is exported.
Liability Assessment
Courts evaluate whether the produced part incorporates the patented design or technology of another party. This evaluation does not require the finished product to be sold locally, as the act of manufacturing itself constitutes an infringement. Companies must ensure they have licenses for all technologies used in their production processes to avoid these legal claims.
Enforcement Mechanism
Patent owners can petition local courts to inspect factories and seize infringing parts before they are assembled into finished goods. This administrative enforcement can halt production lines and cause significant financial losses for the manufacturer. The seized goods are often destroyed to prevent further distribution.
To initiate this process, the patent holder must present clear evidence of the infringement and may need to provide a financial bond to cover any damages if the claim is later found to be invalid.
Commercial Remedy
Damaged parties can seek financial compensation and permanent injunctions to prevent the manufacturer from using the protected technology. Calculating damages involves estimating the profits gained by the infringer or the losses suffered by the patent holder. This calculation can result in substantial payouts that disrupt the financial stability of the infringing factory.