Recent Challenges for Enforcement of Intellectual Property Rights
Intellectual property (IP) rights exist to protect the works of creators and innovators from misappropriation or copying by unauthorized parties. Such protection is in the interests not only of the individual creators, but of wider economic development and consumer interests. Counterfeiting and piracy hamper the growth of national economies, depriving legitimate enterprises of turnover, and the state of revenues. The phenomenon deters investment and innovation,and often violates employment, health and safety legislation. On a transnational scale, counterfeiting often involves and sustains organized crime.
Changing patterns of counterfeiting and piracy
Today counterfeiting and piracy affect a huge spectrum of different goods, from aircraft parts to detergent, from alcohol and perfumes to security holograms. No industry is spared. Whereas previously high-end branded goods were a principal target, the latest trend is also to copy ordinary branded consumer goods – even those as mundane as toothbrushes. The type of goods counterfeited is changing constantly in line with market trends.
Counterfeiters are getting cleverer. They are exploiting technological advances to produce copies hardly distinguishable form the originals, in some cases even outsmarting the proprietors. They are making extensive use of the Internet, resulting in the sale and distribution of fake goods at enormous speed and with no geographical limitations. And they are seeking to circumvent border measures by moving imitation goods across borders in "disassembled" form, i.e. waiting until the consignment has passed through customs before sticking on the trademark labels which would make it obvious that the goods are counterfeit.
The problem is escalating, as demonstrated by the ever greater quantities and types of counterfeit goods seized each year. In 2004, seizures of fake foodstuffs and alcoholic beverages doubled at the European Union external borders, while seizures of computer hardware increased nine-fold over the previous year (see table). The scale and nature of the problem demands a coordinated approach to enforcement measures at the national, regional and international levels.
European Union - Counterfeit Seizures (comparison 2003-2004)
- Percentile increase in number of articles seized
- Computer equipment (hardware) 899%
- Electrical equipment 707%
- Foodstuffs, alcoholic and other drinks 197%
- Clothing and accessories 102%
- Toys and games 47%
- Perfumes and cosmeticis -22%
- Watches and jewellery –27%
- Audio CDs, games, software, DVDs, etc -43%
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Percentile increase in number of articles seized.
Calculating the Cost: OMO
OMO is a detergent, sold and distributed by Unilever. In 2004, a counterfeit version came on the
market for a few months in Mozambique. The counterfeit product, AMO, imitated the OMO graphics,
carried Unilever’s Mozambique address on its label, and sold in identical one kilogram packs.
During the short period that the counterfeit was on the market, OMO sales declined to 40 percent
of its normal monthly rate – a loss not only for Unilever, but more importantly for Mozambique, one
of the least developed countries. The 60 percent drop in sales meant an estimated total revenue
loss to the state of US$ 588,000 in value added tax, import duty and corporate tax that were not
paid by the counterfeiters.
Source: Unilever
WIPO’s role
Working jointly with Member States, industry representatives and other stakeholders, WIPO aims to assist governments and industry in developing effective anti-counterfeiting and piracy strategies. The focus is on awareness-raising, legislative assistance, improved coordination, improving information exchange between right holders and enforcement agencies, and capacity building.
These priorities are pursued on an international level through WIPO’s on-going cooperation with organizations such as World Customs Organizations (WCO), Interpol, World Health Organisation (WHO) and, in an observer capacity, in the Group of G-8. WIPO’s intensive cooperation with WCO, Interpol and NGOs in the framework of the Global Congress Steering Group led to the high-level Global Congress on Combating Counterfeiting and Piracy in Brussels in 2004 and Lyon in 2005 (see the January/February 2006 edition of WIPO Magazine), as well as regionally focused conferences in Rome, Shanghai and Rio de Janeiro. Two more regional forums will be held this year in Romania and in the Gulf States prior to the third Global Congress, which will be hosted by WIPO in Geneva in January 2007.
| International Collaboration: Rome Declaration on Combating Counterfeit Drugs |
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" Counterfeiting medicines…is a vile and serious criminal offence that puts human lives at risk and undermines the credibility of health systems … Because of its direct impact on health…[it] should be combated and punished accordingly." -These words are from the Rome Declaration, issued by the World Health Organization (WHO) International Conference on "Combating Counterfeit Drugs: Building Effective International Collaboration," which took place on February 18. WIPO participated in the Conference and welcomed the declaration, which recognizes the need for the "coordinated effort of all the different public and private stakeholders that are affected and are competent for addressing the different aspects of the problem." It concludes that the WHO should establish an International Medical Products Anti-Counterfeiting Taskforce (IMPACT) of governmental, non-governmental and international institutions aimed at:
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Training
Training for law enforcement agencies are a key part of the work under taken by WIPO. Such training programs bring together the different government agencies, as well as judges and magistrates, so that all involved can better understand the work done by their counterparts and the need for inter-agency cooperation. Cooperation with the private sector is a cornerstone of the success of much of this training.
Training sessions typically include a review of international obligations vis-a-vis provisions in the local laws; and discussion of the importance of deterrent criminal penalties and destruction orders, as well as of adequate damage awards in favor of the prejudiced right holders. Workshops for judges then typically focus on the analysis of IP case law, both from within the country and from other countries. Workshops for prosecutors focus on how to draft charges, to present evidence and to request the court to hand down deterrent sentences, including orders to destroy the counterfeit goods and the implements used in their creation. Training for police investigators aims to provide a clear understanding of the elements requiring proof, in order to increase the chances of successful prosecutions. Customs officials benefit from in-depth training sessions on how to spot those shipments more likely to contain counterfeit goods; as well as how to identify such goods and to secure the cooperation of the right holder in the subsequent border enforcement process.
Advisory Committee on Enforcement
WIPO Member States will shortly be meeting in the Advisory Committee on Enforcement (ACE), the third session of which will be held from May 15 to 17 at WIPO headquarters. The main objectives of the ACE are to enhance information exchange between law enforcement agencies, to assess training and education needs, and develop teaching materials and methodologies, with a view to contributing to the creation of a legal, organizational and technical framework for effective enforcement of IP rights. The forthcoming session will focus on the theme of education and awareness-raising, including presentations by a number of delegations detailing current efforts in this field.
Through all its activities, WIPO will continue, on request from Member States, to offer advice, training and facilitation in order to assist those Member States in their efforts to render the enforcement chain more effective, to improve the handling of IP disputes, to set up appropriate anti-counterfeiting mechanisms and to strengthen essential partnerships between the public and private sectors.
Operation Jupiter, South America
Interpol’s first Operation Jupiter ran from November 2004 to April 2005 with the participation of the Argentinean, Brazilian and Paraguayan national police forces, Brazilian customs, and representatives from pharmaceutical, recording, motion picture and tobacco cross-industry bodies. This was the first time that four different industry sectors had joined with representatives of federal police and customs agencies from the three countries to combat IP crime. The results were impressive, and there were immediate benefits for participating industry sectors, including the identification of common efficiencies, crime prevention measures, investigation methodologies and good practices.
The success of the operations depended on close cooperation between the law enforcement agencies at national and transnational level; as well as on the willingness of the participating industries to engage in the frank exchange of information with their counterparts in other industry sectors for the common good. The results of the first Operation Jupiter have encouraged a number of other countries to request the launch of similar operations on their borders. A second Operation is planned to begin in 2006.
(source www.interpol.int/public/FinancialCrime/IntellectualProperty/Cases/)
The WIPO Magazine is intended to help broaden public understanding of intellectual property and of WIPO’s work, and is not an official document of WIPO. The designations employed and the presentation of material throughout this publication do not imply the expression of any opinion whatsoever on the part of WIPO concerning the legal status of any country, territory or area or of its authorities, or concerning the delimitation of its frontiers or boundaries. This publication is not intended to reflect the views of the Member States or the WIPO Secretariat. The mention of specific companies or products of manufacturers does not imply that they are endorsed or recommended by WIPO in preference to others of a similar nature that are not mentioned.