There are a few options.
1) They just send a letter for you to come with receipt to declare value and pay customs.
2) They send a letter that the watch is being examined for patent or IP theft.
3) They send a letter from OEM legal threatening fine and legal action.
All three mean you have lost the watch, and maybe need to change your mailing address for future shipments.
Sorry to hear of your loss, however, this could have almost certainly have been prevented in the UK.
When the third party company who act on behalf of the IP holder write to you to say they have your watch, you simply state that you have bought the goods in good faith and you do not authorise their detainment or destruction. Copy the Boarder Protection Agency on this communication and demand a reply within 10 days.
You then ask them to provide proof that your goods are counterfeit from the IP holder and that you'll see them in court.
At this point they say sorry and send you your watch to you.