The rise of e-commerce is fuelling the growth in sales of fake goods around the world.

In 2016, a report by the OECD (The Organisation for Economic Co-operation and Development) estimated that the value of global trade in counterfeits had touched $590bn (£384.4bn), representing 3.3% of total international trade. Much of this illicit trade is being channelled through the virtual stores of online retail, presenting a complex set of challenges for brands seeking to halt this activity which negatively impacts their reputation and ultimately, revenue streams.

Counterfeiting can be defined as “…the manufacture, importation, distribution and sale of products which falsely carry the trade mark of a genuine brand.” Put another way, it is the unauthorised and improper use of products protected under intellectual property (IP) laws.

Online this invariably takes the form of a third-party seller creating a listing that deceives buyers into purchasing knock offs, using logos, symbols and features that identify certain brands.

The world of e-commerce abounds with bad actors spoiling to exploit the hard-earned success of your brand. However, with robust measures in place you will find yourself in a stronger position to frustrate their aims.

What online resources do brands have access to?

Faced with mounting criticism over the alleged unchecked development of a thriving counterfeit industry, e-commerce platforms have responded by introducing initiatives that facilitate the removal of spurious listings.

Amazon Brand Registry is a good case in point. Enrolment of your brand in the programme can offer many benefits. The primary benefit from an anti-counterfeiting perspective is that it can expedite the process of removing counterfeit listings. Emphasising a proactive approach, once a listing has been identified as counterfeit, brand owners and their representatives report to Amazon and the offending listing is removed. To be eligible you must have an Amazon account and a brand protected by a registered trade mark (more on this later). Text-based (product names or brand names) and image-based (logos) are the only acceptable types of trade marks that amazon will enforce through the registry at present.

Having just come on stream last year, Project Zero is Amazon’s latest scheme that aims to build upon the Brand Registry. Among other things, it enables legitimate sellers to remove inauthentic products directly, eliminating the need to file a report with Amazon – this is the new self-service feature. To be considered eligible you must already be enrolled in the Brand Registry. It has the limitation of being invite only, however.

One of Amazon’s nearest rivals, eBay, has the Verified Rights Owner programme or “VeRO” . In order to register you must have a registered trade mark – are you starting to see a pattern here? – and removing counterfeits follows much the same reporting mechanism as Brand Registry.

How does trade mark registration influence decisions on enrolment?

To explore this question, we will take Amazon Brand Registry as an example. Currently it includes the following markets;  United States, Brazil, Canada, Mexico, Australia, Japan, India, Turkey, Singapore, France, Germany, Italy, Spain, Netherlands, United Kingdom, the European Union, Turkey, and the United Arab Emirates.

Due to the country-specific nature of trade mark protection, choices for what countries you wish to be Brand Registry covered would reflect where you have a trade mark registered. (i.e. a UK trade mark registration would not satisfy enrolment requirements to access the United States’ Brand Registry services.)

What does registering a trade mark entail?

Registration of a trade mark is not automatic, it is a process that begins with lodging an application at a country’s IPO (Intellectual Property Office) and, if successful, concludes after it has been shown to fulfil the legal requirements found in that particular country.

Trade mark protection is territorial, meaning individual applications should be filed in each country you wish to be formally protected. Cost and timescale of registering a trade mark is not consistent and varies country-to-country.

We strongly advise you register both the brand names and logos that you market your products under. The greater the spread of protection is, the more you can maximise the effectiveness of the types of initiatives described above.

Closing thoughts on effective strategies

In conclusion, there is much to take into account when strategising a best approach to preventing counterfeit products from piggy backing on the success of your brand, but a summary of important considerations are set out below:

  • a registered trade mark protecting your brand is key to success in the e-commerce world; 
  • ensure you have a trade mark registration in each country you have a commercial presence;
  • understand and leverage the anti-counterfeiting programmes made available on the online retail platform   of your choice;
  • exercise vigilance, proactively vetting listings for inauthentic products that should be reported and removed.

Interested in developing a strategy for combating counterfeits online and/or considering applying to protect your brand as a registered trade mark? Please get in contact with one of our trade mark attorneys.

This article (and any information accessed through links in this article) is provided for information and educational purposes only. This article does not constitute professional legal advice. Professional legal advice should be obtained before performing any action based on the information provided in this article. All professional legal advice will be given in accordance with Creation IP Terms of Business. Please contact us for further information.

In this article, Creation IP Trade Mark Associate Andrew Couttie discusses the impact of e-commerce on counterfeit sales and the trade mark strategies for tackling this threat.

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