The Alliance Against Intellectual Property Theft (AAIPT) is a unique coalition of trade and enforcement organizations, providing a single voice for those who share an interest in preventing counterfeiting and piracy in the UK.

Recently, the AAIPT has campaigned for a national crackdown on the sale of counterfeit goods at street markets and boot fairs. To implement such a crackdown, all councils and market organizers must sign onto a national charter. The reason why this is important is that, currently, if one council takes action, the fake goods sellers simply moves somewhere else. A national charter would be much more effective because it would involve sharing intelligence with the police about illegal trading, and set out consistent principles that all signatories would have to abide by.

Presumably, these principles will draw from Andrew Gowers’ report on his year-long review of the UK’s intellectual property regime. An improved notification scheme would require organizers of markets to notify the local authority a certain number of days in advance as well as place an obligation on organizers to gather, on the day, names, address and vehicle licence details of all dealers at the sale and to note the type of goods or services being sold. Age restrictions that require an adult to be responsible for renting market stalls and to remain within the premises of the sale during trading would prevent the exploitation of youths or children in selling faking products in order to escape prosecution. The ability to prosecute organizers of markets will also add to the effectiveness of regulation of markets with respect to intellectual property theft. If there is no mechanism to prosecute market organizers for allowing known counterfeiters and pirates to trade on their sites, then organizers may not have as much incentive to cooperate.

In a similar fashion, there are many proponents in Canada who are advocating for much tighter regulation on intellectual property theft in Canada. The Canadian Anti-Counterfeiting Network (CACN) is a coalition of individuals companies, firms and associations that have united in the fight against product counterfeiting and copyright piracy in Canada. In a recent CACN position paper entitled “The Need for Legal Reform in Canada to Address Intellectual Property Crime”, authors Brian Isaac and Carol Osmond highlight the implications of intellectual property theft in Canada, pinpoint the current problems in terms of enforcement and finally suggest the reforms that are needed.

Most obviously, intellectual property theft deprives legitimate rights holders of their rights generally. However, there are profound implications beyond this. Firstly, there are economic implications. According to the CACN position paper, the counterfeit industry in Canada was recently estimated to be worth $20 – $30 billion dollars annually. Specifically, the Canadian Alliance Against Software Theft estimated that in 2002, software theft alone cost Canada over $1.5 billion USD in lost retail sales, $1.4 billion USD in lost wages and over $340 million USD in lost tax revenues. Secondly, there are health and safety implications. For example, in 2006, counterfeit batteries from China, disguised as a Western brand, lacked a near-invisible vent that allows pressure to escape, thus increasing exponentially the risk of the batteries exploding. In 2007, counterfeit Colgate toothpaste tubes from China were found to possibly contain a poison used in antifreeze. Thirdly, intellectual property theft (and undoubtedly any type of illegal activity that must involve many types of people including manufacturers, distributers, etc) necessarily involves organized crime.

On an international level, Canada has agreed to prosecute those who engage in willful trade-mark counterfeiting and copyright piracy on a commercial scale as well as to implement border measures to prevent the importation of counterfeit and pirated goods. Such agreements include both the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights and the North American Free Trade Agreement. But the burning question is this: how effective have enforcement efforts been? There is a significant amount of indication that enforcement efforts have not been effective enough. One does not have to look very hard to find a market stand or store that sells pirated DVDs or fake Louis Vuitton purses. Why is this? According to the CACN position paper, Canada’s statutory framework and enforcement are not very effective in promoting a societal stigma against dealing in counterfeit or pirated products. As well, there are no cost effective enforcement tools and inadequate deterrence to make a significant impact on the profitability of dealing in such products.

The authors of the CACN position paper recommend that legislation be enacted to provide for simple administrative seizure destruction of products clearly established to be counterfeit or pirated on an absolute liability basis and for criminal penalties for those who knowingly deal with counterfeit and pirated products. The recommended statute would define the activity prohibited by the statute; prescribe offences for manufacture and commercial importation and distribution of counterfeit and pirated products; provide for authority to seize and simple, inexpensive administrative procedures for destruction of counterfeit and pirated products; enact border measures to mandate and facilitate detection, seizure and destruction of imported counterfeit and pirated products; deal with jurisdictional issues in respect of administrative and criminal enforcement and prosecution; provide for disclosure of information to and cooperation with IP owners; and provide summary civil proceedings and statutory damages for clear cases of product counterfeiting and piracy.

Posted in IP, Trademarks, Uncategorized