Brand Protection Helping To Save Lives

Gokcen Uzer Cengelci / Lisa Wright,

Do you know that footwear is the most counterfeited item in the world today? 

According to the Organization for Economic Cooperation and Development (OECD), 22% of all counterfeit goods seized are footwear - and trade in counterfeit and pirated goods is now 3.3% of world trade and is rising. According to a 2020 status report by the EUIPO on infringement, counterfeiting has expanded from activities centered on luxury brands, towards pharmaceutical products, electronic goods, cosmetic products, automotive spare parts, tobacco, pesticides, toys, food and drinks, and even technical products, such as bearings and electronic components. 

This diversification by counterfeiters towards everyday goods has far-reaching consequences. Outside of any economic losses, there is also a risk of both environmental damage and risk to the health and safety of consumers. Counterfeiting is also often linked to organized crime, such as drug trafficking, manslaughter, child labor, bribery and corruption, or money laundering. 

However, trying to win the war against burgeoning counterfeit goods by informing consumers of the economic havoc fake products wreck can often be an uphill battle. What does prompt change, albeit slowly, for brand owners is to consistently highlight the damage counterfeit products can cause to their purchasers - as well as keeping a vigilant watch over their trademarks and brand names and taking swift action when any infringement is caught. 

Monitoring trademarks and tag lines for potential infringements is a 24/7 task in this ‘always-on’ digital world. Here is an overview of three prominent industries - namely: pharmaceuticals; cosmetics and personal care products; and children’s products - that brand owners actively monitor for counterfeit goods - and in doing so also help to protect the good health of their consumers.

1. Pharmaceuticals

One example in which dangerous counterfeit products can cause serious harm, and even fatalities, is the pharmaceutical industry. Forget the image of a travelling peddler selling bottles of 'miracle' cure; today's fake medicines are sold through highly-financed, multi-national criminal gangs, operating in a market which is growing at a rate of some 20% year on year and is worth a staggering $200 billion a year.

A recent Europol-EUIPO poly-criminality report has found that in these cases of counterfeit pharmaceuticals, investigations have identified other related offenses, such as “drugs and illicit substances, crimes against the public health, money laundering, fraud, bribery, document fraud and corruption”.

Counterfeit versions of branded and generic medicines - as well as lifesaving prescription medicines for cancer and serious cardiovascular diseases - are being sold to consumers at an alarming rate online. Aside from the significant economic losses incurred by brand owners (some €6 billion annually in direct lost sales in the EU alone), the sale of fake pharmaceuticals has resulted in a serious threat to the public. Antibiotics tops the list of counterfeit types of pharmaceuticals seized globally by customs during 2014-2016, with sexual impuissance treatment, painkillers, anti-malarial and diabetes treatment also featuring.   

Protecting your brand from counterfeiters who are operating at such speed can be a daunting task - even for brand protection professionals. There is a real need to meet the increasingly complex demands of modern brands with technology, human expertise, and global reach.

Outside of the pharmaceutical industry, counterfeit goods routinely destroy healthy lives.  Below are some examples of less talked about sectors plagued by fakes.

2. Cosmetics and personal care products

Both women and men have sacrificed their health for youth and beauty since classical times. In her book, Face Paint, Lisa Eldridge wrote that traces of lead had been found in the graves of upper-class women who lived in ancient Greece. Most famously, Queen Elizabeth I and the ladies of her court slathered Venetian Ceruse, a lethal mixture of vinegar and lead, over their faces to hide smallpox scars and achieve a fashionable pure white complexion.

Today, counterfeit cosmetics are still created from all manner of lethal and often vile ingredients, including lead, mercury, cyanide, arsenic and paint-stripper. Consumers can be inflicted with chemical burns, skin infections, and long-term health problems such as lead poisoning.

According to the Intellectual Property Office (IPO) Crime and Enforcement data, between 2017-18, more than 2.2 million fake body care items, including cosmetics and perfumes, were seized in the UK alone. And, in the EU the sector has seen direct lost sales to the tune of some 14% for cosmetics and personal care products, amounting to an estimated €9.6 billion annually.

3. Children's products

Few parents would knowingly purchase a product that had the potential to cause harm to their child. However, when you buy a toy, pram, highchair etc via social media or online, you may inadvertently be buying a counterfeit product.  

Government revenue loss from counterfeit toys and games has reached €0.3 billion in Europe alone, with €1 billion in direct lost sales, each year.  

Reputable children's product manufacturers must abide by strict rules and regulations. In the US, the Consumer Product Safety Commission (CPSC) regulates products made for children under 12 years via the Consumer Product Safety Improvement Act of 2008 (CPSIA). Mandatory third-party testing is required to ensure goods aimed at under 12s comply with the "rules, bans, standards, or regulations applicable to the product".

Counterfeiters have little concern for child safety. The biggest dangers associated with counterfeit children's products include the presence of toxic materials such as lead and phthalates (the latter is known to cause irreversible damage to internal organs), as well as choking, electrical shock and fire.

The rise of counterfeit goods

One of the main reasons that counterfeit goods have boomed in recent years is thanks to online shopping. Platforms that support third-party buyers have seen numerous counterfeiters set up shop, despite strict anti-counterfeiting policies.

Brand owners

For brand owners the solution to the problem of counterfeits is not simple. Many producers and distributors today are actively seeking to gain greater visibility over their supply chain operations in order to deter counterfeiting. VerifyMe is one such digital technology solutions provider which specializes in brand protection functions such as counterfeit prevention, authentication, serialization, track and trace features for labels, packaging and products. 

Global brand protection, trademark and domain names solutions provider Corsearch has recently partnered with VerifyMe in order to collaborate on positive solutions for e-commerce counterfeiting and brand abuse. Corsearch CEO, Tobias Hartmann, explains why, “As the e-commerce landscape grows ever more complex, brands are facing a wide range of new challenges that require integrated solutions from experts with a variety of specialisms”.

Online shoppers

Consumers can also act to protect themselves from fake, dangerous goods using a measure of common sense. Here are 10 ways that savvy e-commerce customers can protect themselves, courtesy of STOPfakes.gov:

  • Examine labels, packaging and contents closely
  • Search out authorized retailers - only buy from that brand’s physical or online store
  • Look for missing sales tax charges
  • Demand secure transactions
  • Look for quality assurance in the secondary market
  • Report any spam or faulty products
  • Be aware when buying abroad
  • Educate your family about counterfeits
  • Warn family and friends about illegitimate product sources
  • Trust in yourself and your instincts

Final thoughts

IP crime is one of the biggest threats facing brand owners today. The globalization of counterfeiting coupled with local nuances in different jurisdictions can make the act of creating a strong anti-counterfeiting strategy challenging for brand owners. 

Counterfeiting jeopardizes the profits and reputation of corporations as well as the health and safety, and loyalty of consumers. Counterfeit goods only benefit criminals

Let us not sacrifice our wealth and risk our health to make them richer.

Stronger together

With the largest e-commerce market in the world, China is also home to some of the most persistent counterfeit sellers. This month, our partners in brand protection, Corsearch, are dedicating an entire week to the Chinese e-commerce industry, dissecting four of the newest platforms and their unique trends, and ending the week with a virtual presentation from their Brand Protection team in Shanghai.

If you’re looking to get in control of your brand’s online presence in China, join us on Friday, September 25 at 8:00 CEST and 14:00 EST.

LEARN MORE

By Gokcen Uzer Cengelci / Lisa Wright
Gokcen Uzer Cengelci, Trademark Counsel at TrademarkNow, worked as a trademark attorney for over 12 years in top-tier trademark law firms where she specialized in opposition procedures and trademark portfolio management strategies. She regularly publishes articles on trademark law and has a deep interest in the role of legal tech in IP. Lisa Wright, Content Writer at TrademarkNow is a graduate of the University of Law. She researches and publishes books, articles, and webinars on global IP law and trademark activity.

Comments