2021 Anti-counterfeiting and Online Brand Enforcement - A Global Guide
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Anti-counterfeiting
and Online Brand
Enforcement
2021
Introduction
INTA
Maysa Razavi
A Global Guide
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www.inta.org/membershipIntroduction
INTA
The life of a brand-
protection professional
during the pandemic
Author
Maysa Razavi
Brand protection during the pandemic were quick to begin producing much-needed
Counterfeiting continues to spread globally medical equipment and supplies. Brand-
like a plague. In recent years, with the protection teams, however, have been stepping
expansion of the Internet, brand-protection up to the mounting challenge and developing
teams have had to battle with counterfeiters some creative solutions to deal with these
online, usually with limited resources to issues. Awareness-raising campaigns to reach
tackle these illicit traders. Fake goods are sold both consumers and policymakers, customs
online directly to consumers, one item at a training, consumer-protection mechanisms
time, often by formidable and well-hidden and private-public and cross-industry
criminal networks. collaborations are all in the mix. Some of the
In 2017, Global Financial Integrity found strategies are under way, while others have
that transnational crime turned over between been proposed, and the full results are yet to
$1.6 trillion and $2.2 trillion annually, with be realised.
counterfeiting valued as the most lucrative
crime ($923 billion to $1.13 trillion) followed Criminals take advantage
by drug trafficking ($426 billion to $652 As we got used to social distancing and
billion). Despite this, counterfeiting is a low working from home, the criminal underworld
priority for enforcement officials, making adapted to the crisis in its own way by turning
it a low-risk, high-reward crime. Although to cybercrime, fraud and counterfeiting.
fake goods are often of poor quality and For counterfeiters, the covid-19 crisis
potentially dangerous, consumer demand offered the perfect environment within
for these goods is high. Under these which to operate. As the epidemic turned
circumstances – high demand and weak into a pandemic, consumers worldwide
enforcement – anti-counterfeiting appears to began to stock up on products to get them
be an insurmountable challenge for brand- through the crisis, purchasing food, over-
protection teams. Compounding matters the-counter medicine, personal-care goods
further, in 2020 the covid-19 pandemic and disinfectants in mass quantities. As
spread to every corner of the globe, upending commonplace items such as hand sanitiser
life as we know it and amplifying the and toilet paper began to sell out, consumers
counterfeiting problem. began searching more widely for these goods,
E-commerce expanded rapidly as looking outside authorised retail stores.
consumers increased their online spending Counterfeiters have followed these
under lockdown conditions, and counterfeiters purchasing trends and seized the opportunity
www.WorldTrademarkReview.com Anti-counterfeiting and Online Brand Enforcement: A Global Guide 2021 | 19INTRODUCTION INTA
The Internet provides an ideal setting in which
counterfeiters can thrive; especially as desperate
consumers look online for high-demand items
to flood the market with fake, substandard the pandemic. It also reported significant
goods to take advantage of buyers. Fake changes in the type of goods in demand as
medicines, fake surgical masks and fake 2020 progressed. From the beginning, PPE
test kits linked to covid-19 have become and health-related products were important
widespread. to consumers, but demand for a wider
In late March 2020, a report by Europol range of goods including food and home-
emphasised that criminals “have quickly improvement products, for example, has also
seized the opportunities to exploit the crisis increased. Businesses that made the switch
by adapting their modes of operation or to online sales were in a better position to
developing new criminal activities”, including salvage their profits.
cybercrime, fraud and the distribution Now, e-commerce has become the ‘general
of counterfeit and/or substandard goods. store’ for everyone’s needs, as many people
Counterfeiters participate in many other continue to stay home to limit their exposure
schemes as well, such as phishing, scamming to the virus. The Internet provides an ideal
and online fraud. setting in which counterfeiters can thrive;
These illicit activities pose significant especially as desperate consumers look
health and safety risks for consumers at a online for high-demand items. Shoppers
time when health and safety is paramount. may not even be aware of the seller’s identity
Consumers rely on the goods they buy to be or whether the goods that they are buying
what they are represented to be. They trust are genuine. Even photographs of goods on
that the disinfectants they purchase will websites are often stolen from the brand
protect them from lingering germs and that owner’s website. Counterfeiters can also
the medicines they buy to fight fevers and easily and anonymously accept credit card
coughs will contain effective ingredients. transactions from across the globe and later
Trademarks underscore this trust. And use consumers’ collected data to perpetrate
brand-protection teams defend this trust. identity theft.
With counterfeit products, all bets are off. Protecting consumers from online fraud
has been challenging. A recent European
Supply shrinks and demand increases Commission study reported that 57% of EU
The pandemic has not only affected citizens aged between 55 and 74 years made
pharmaceuticals and personal protective an online purchase in 2020, up from 45%
equipment (PPE); the effects can be seen in 2010. This demographic has traditionally
across industries. As quarantines began, favoured the immediate customer service
manufacturing slowed down and businesses available at bricks-and-mortar shops, but
prepared for an economic downturn. since shopping in a physical store has
However, consumers kept buying goods, become a potential health risk, online
ranging from exercise equipment to home shopping has become the trend.
decor and eye makeup. Even more than a The decrease in supply of goods and the
year later, businesses cannot keep up with increase in demand may have led some
the demand for certain goods. consumers to be less concerned about where
The United Nations reported a significant their goods are coming from, prompting
increase in e-commerce sales as a result of them to buy from unidentified sources. As
20 | Anti-counterfeiting and Online Brand Enforcement: A Global Guide 2021 www.WorldTrademarkReview.comINTA INTRODUCTION
demand for face masks outpaced supply,
counterfeit N-95 masks flooded the market,
and as demand for branded, luxury face
masks grew, counterfeiter products filled that
void too.
Brand-protection resources
Border shutdowns and travel bans have also
affected the supply of goods flowing through
e-commerce and offline purchases as well.
A decrease in passenger flights means fewer
opportunities for small packages to be sent
to consumers in other regions. The shortage Maysa Razavi
of staff, confusion about new travel rules External relations manager, anti-counterfeiting
and limitations on physical distancing cause mrazavi@inta.org
delays in cargo transit and make targeting
counterfeits more difficult and less of a Maysa Razavi leads the global anti-
priority. counterfeiting efforts of INTA, a global
On top of all these challenges, there association of brand owners and professionals
are fewer brand-protection professionals dedicated to supporting trademarks and
doing the anti-counterfeiting work. related intellectual property to foster consumer
Many businesses furloughed and trust, economic growth and innovation. As
then consequently laid off their anti- a not-for-profit association, INTA’s role is to
counterfeiting teams as non-essential staff. serve its members, the profession and society
With fewer internal resources and fewer as a trusted and influential advocate for the
enforcement officials looking at these issues, economic and social value of brands.
counterfeiting is growing exponentially Ms Razavi graduated cum laude from
during the pandemic. New York Law School and worked on anti-
counterfeiting matters in-house at various
Lessons learned corporations before joining INTA in 2012.
Nevertheless, brand-protection work has
adapted and much has been learned over
the past few months in support of the anti-
counterfeiting battle. or their lives,” said Jürgen Stock, Interpol’s
secretary general. These warnings have been
Consumer awareness increasingly urgent echoed throughout the pandemic for health
Raising consumer awareness about the and safety goods, but also during the 2020
dangers of counterfeiting has been at the holiday shopping season for clothes, personal
forefront of combating fakes. For more than electronics and toys. By November 2020, US
a year, the news has been riddled with stories Customs and Border Protection had seized
of counterfeit masks and coronavirus tests 26,503 shipments of counterfeit goods valued
– and now vaccines. Early in the pandemic, at more than $1.3 billion.
in March 2020, Interpol’s Operation Pangea, In July and August 2020, several brands,
an international operation targeting illicit including Philip Morris, Procter & Gamble
pharmaceuticals, seized 34,000 fake surgical and Tommy Hilfiger, working with the US
masks and identified 2,000 online links Department of Homeland Security and US
advertising counterfeit items related to covid- Immigration and Customs Enforcement
19. “Once again, Operation Pangea shows that (ICE), launched a public awareness initiative
criminals will stop at nothing to make a profit. in the fight against covid-19 to help combat
The illicit trade in such counterfeit medical trade in fraudulent goods. The advertising
items during a public health crisis shows campaign raised awareness about counterfeit
their total disregard for people’s well-being, PPE, faulty test kits and other fake supplies.
www.WorldTrademarkReview.com Anti-counterfeiting and Online Brand Enforcement: A Global Guide 2021 | 21INTRODUCTION INTA
The campaign comprised printed and digital 2021 priorities do not include IP crime or
public service advertisements (with logos of counterfeiting. Against that backdrop, and in
participating partners) appearing nationally cooperation with the European Observatory
in key publications, including The Washington on Infringements of Intellectual Property
Post, The Wall Street Journal, Vice Magazine, Rights and its network, INTA has been
Politico and Vox, as well as through cable working closely with other European IP
news channel CNN. associations to incorporate IP crime into the
Over the years, INTA has advocated the next EMPACT cycle. If successful, this effort
collaboration of both the public and brand will not only make fighting counterfeiting
owners in helping to raise awareness of a priority, but it will allot more of Europol’s
the dangers of counterfeits by bringing resources to this growing crime.
its Unreal Campaign into schools. INTA Virtual customs training is another
launched the Unreal Campaign in 2012. This key element that can raise awareness of
global campaign, which aims to educate counterfeiting at international borders. In
young consumers (14 to 23 years old) about 2015, INTA launched a pilot virtual customs
the dangers of counterfeiting and the training platform to allow its members to reach
importance of trademarks, has reached officials around the world without the added
more than 55,000 students in more than 125 cost of having to travel to each port. The videos
cities in 40 jurisdictions. On social media, were recorded and translated into Spanish and
the campaign has displayed more than 3.8 Mandarin. Even in a post-pandemic world,
million impressions (measurement of reach) brand owners would not be able to travel to
and has had more than 188,000 engagements. every port, and virtual customs training has
In 2020, the campaign went virtual, with become the trend. INTA is helping by holding
48 presentations (14 onsite and 34 virtual) free, virtual regional and national customs
reaching 11,574 students in 15 countries training for members in various jurisdictions
(Argentina, the Cayman Islands, Germany, globally, which were not originally open to
India, Israel, Italy, Mexico, Nicaragua, Nigeria, virtual training. More training will be available
Peru, the Philippines, Spain, Turkey, the as borders start to open up.
United States and Uruguay).
In INTA’s most recent submission to Calls for improved consumer-protection
the USPTO in December 2020, it called for mechanisms
developing a national consumer awareness Along the same lines, and because of the
campaign on combating the trafficking in scale of the issue, consumer-protection
counterfeit and pirated products. As seen mechanisms should be put into place to
over the past year, consumer awareness of include counterfeiting. The fight against
the dangers of counterfeiting is a consumer- unsafe counterfeit goods represents a core
protection initiative, rather than a private consumer-protection issue, given the high
initiative. risk that counterfeits raise for the health and
Policymakers must be made aware of safety of consumers and citizens worldwide,
the dangers of counterfeiting. Europol is in particular, during the current covid-
currently preparing priorities for its European 19 crisis.
multidisciplinary platform against criminal In June 2019, the EUIPO reported “the
threats (EMPACT) for the EU Policy Cycle extent of the dangers to health posed by
2022-2025. The earlier policy cycle (2013- counterfeit goods” to EU consumers, such as
2017) prioritised the successful advocacy “chemical, injuries, strangulation, choking,
and mobilisation by private and public IP electric shock, damage to hearing and
authorities, specifically addressing organised- fire risks”, adding that “24 percent of the
crime groups involved in the production dangerous products recorded as counterfeit
and distribution of counterfeit goods that posed more than one danger to users”.
violated health, safety and food regulations, Toys are the most ‘popular’ type of unsafe
as well as those that produced substandard counterfeit product and children were the
goods. However, the current EMPACT 2018- end users of 80% of the products reported
22 | Anti-counterfeiting and Online Brand Enforcement: A Global Guide 2021 www.WorldTrademarkReview.comINTA INTRODUCTION
INTA promotes collaboration as the foundation of its
fight against online counterfeiting
to be dangerous and counterfeit (ie, toys, Operation Stolen Promise is the work around
childcare items and children’s clothing). 78,141 covid-19-related domain names that
Fake pharmaceutical products – notably were analysed by HSI.
antibiotics, lifestyle drugs and painkillers – INTA promotes collaboration as the
traded worldwide at an estimated $4.4 billion foundation of its fight against online
in 2016. counterfeiting. Its guidelines, entitled
INTA has been advocating measures Addressing the Sale of Counterfeits on the
to protect consumers from these dangers Internet, provide best practices for the
by including unsafe counterfeit goods in various private-sector stakeholders to work
the scope of the European Commission’s together to combat counterfeiting. INTA’s
upcoming New Consumer Agenda, as well as anti-counterfeiting committee is working
within the provisions of the General Product together with its enforcement and internet
Safety Directive. INTA is also looking at how committees to update these guidelines in
covid-19 fraud provisions in the Consolidated 2021. INTA has held more than 60 policy
Appropriations Act passed by the US federal dialogues over the past 10 years since the best
government in December 2020 will affect practices were created. In the past year, INTA
anti-counterfeiting measures. INTA’s anti- hosted 14 discussions with member platform
counterfeiting committee is also looking at intermediaries to promote their online
the anti-fraud provisions in Singapore, which counterfeiting policies. Also in 2021, INTA
began with a joint event with EuroCham on 30 began hosting corporate insider discussions
March 2021. on brand protection to allow corporate
members to freely discuss best practices
New tools for better collaboration and exchange ideas to improve their anti-
Finally, and an equally critical variable in the counterfeiting work.
anti-counterfeiting equation, is collaboration. INTA’s March 2021 Board Resolution
Private-public and cross-industry on Proceeds of Counterfeiting is intended
collaboration is paramount, especially in to deprive counterfeiters of the financial
fighting online counterfeiting. resources supporting their illegal
An example of effective collaboration is operations – in effect, adopting a ‘follow
the success of Operation Stolen Promise, the money’ model. The board resolution
launched in February 2021 by ICE’s Homeland seeks to empower courts with the legal
Security Investigations (HSI) to stop covid-19- basis to confiscate and seize assets on a
related fraud with a focus on illicit counterfeit temporary basis, subject to appropriate
goods. The first pillar of the operation’s evidentiary requirements, prior to securing
strategy is partnership. HSI is partnering a conviction when proceeds appear to be
and sharing intelligence with private the result of counterfeiting. It also calls for
organisations such as 3M, Amazon and Pfizer empowering courts to order the confiscation
to combat counterfeiting. The results have of the apparent assets or proceeds of
been staggering. As of 25 March 2021, there counterfeiting when counterfeiters transfer
have been 2,054 covid-19-related seizures, assets to third parties for the purpose of
including counterfeit masks and medicines evading confiscation orders on an interim
totalling in excess of $47.2 million, with 265 or perpetual basis. In addition, it urges
arrests. One of the most effective models of enactment of comprehensive procedures to
www.WorldTrademarkReview.com Anti-counterfeiting and Online Brand Enforcement: A Global Guide 2021 | 23INTRODUCTION INTA strengthen the effectiveness of confiscation, together have emerged and this improved including the efficient management and collaboration will help combat these crimes. protection of frozen or seized goods and their adequate disposal and transfer to the appropriate entity when a defendant is found guilty of counterfeiting. It also encourages greater international collaboration by providing reciprocal freezing and seizure orders. These are the tools needed to keep criminals from getting an upper hand. The increase in criminal counterfeiting, the rise in e-commerce sales, the slowdown of manufacturing, the lack of consumer INTA awareness, limited resources and the high 675 Third Avenue demand for goods have all exacerbated the 3rd floor challenges that brand owners will continue to New York NY 10017 face during the pandemic. With counterfeiting United States soaring to new, unanticipated levels, brand- Tel +1 212 642 1700 protection teams must adapt and create new Fax +1 212 768 7796 solutions. Innovative measures of working Web www.inta.org 24 | Anti-counterfeiting and Online Brand Enforcement: A Global Guide 2021 www.WorldTrademarkReview.com
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