Counterfeiting in the Canadian Market - Manitoba Chambers of ...

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Enforcement officials need to be willing to useinnovative tools to tackle the challenges presentedby counterfeiting and need to know that they will besupported with the necessary legal tools and resources.Rights holders are willing to support innovativeprogramming in order to address the challengesthey face.Partnerships With IntermediariesThere are a number of measures through which IPRcan be effectively enforced online, yet it is increasinglyoccurring through partnerships with “onlineintermediaries.” Typically, positive relationshipsbetween rights holders and these intermediaries,including online payment processors, search engines,Internet service providers, online advertisers, onlineretailers, web auction sites, web hosting providers,domain name system (DNS) registries and social mediaplatforms, can provide the basis for cooperation in theprevention of counterfeit distribution. This relationshiprequires the support of government.In the OECD’s Declaration for the Future of the InternetEconomy, the organization outlined eight goals, twoof which were to ensure respect for IPR and to ensurea trusted Internet-based environment which offersprotections to individuals. The OECD has stated thatgovernment cooperation with Internet intermediariesis key to protecting both consumers and IPR online. 96Payment processors have proven to be willingpartners in working with rights holders to preventthe infringement of rights online. As an example,VISA participated in Operation Pangea, using itsparticipation in the project as an opportunity to remindits clients that all of their transactions processed byVISA must be compliant with the laws in both thecountry of the seller and of the buyer. 97Many sites that offer counterfeit and pirated goodsderive a portion or all of their revenues fromadvertising. The banner and display ads that appearon these websites are frequently placed there by adbrokers who place online advertising in the view oftarget audiences for advertisers. Operators of sitesthat offer counterfeit goods also use these servicesto advertise their illegitimate products in associationwith legitimate goods. A two-pronged approach byowners of legitimate content is required to addressthis problem. First, advertisers of legitimate productsmust demand that online ad brokers not place theirads on websites that offer illegitimate goods and thatthese same brokers not place ads on their legitimatewebsites for illegitimate goods. Second, in order toavoid consumer confusion, action must be taken by adbrokers to limit the use of their services by operatorsof illegitimate websites. Online advertisers, alsoconcerned about the safety of their consumers, aretaking some positive action. Google has acknowledgedthat “Like all other Internet companies, we are fightinga war against a huge number of bad actors—fromwebsites selling counterfeit goods and fraudulenttickets to underground international operations tryingto spread malware and spyware.” 98Recently, two major industry associations, TheAssociation of National Advertisers and the AmericanAssociation of Advertising Agencies, implementedpolicies to discourage their members from placingadvertisements on rogue sites—sites that infringeIPR. In this process, the agencies recommendedthat companies include a clause in their advertisingcontracts that require advertisers to take “commerciallyreasonable measures” to prevent their ads fromappearing on rogue sites. 99 The groups indicated thatthey made this commitment because “we should notknowingly allow our businesses and brands to supplyfinancial lifeblood or lend a veneer of legitimacy to96 OECD, The Economic and Social Role of Internet Intermediaries, April 2010. Available at: www.oecd.org/dataoecd/49/44949023.pdf97 VISA Press Release, VISA supports global law enforcement action against rogue online pharmacies, October 14, 2010. Available at:http://www.visaeurope.com/en/newsroom/news/articles/2010/supporting_operation_pangea.aspx98 Google Official Blog Making Our Ads Better for Everyone March 14, 2012. Available at: http://googleblog.blogspot.ca/2012/03/making-ourads-better-for-everyone.html99 Brendan Sasso, Advertisers Pledge not to Support Rogue Sites, The Hill, May 3, 2012. Available at: http://thehill.com/blogs/hillicon-valley/technology/225249-advertisers-pledge-to-not-support-rogue-pirate-sitesCounterfeiting in the Canadian Market | The Canadian Intellectual Property Council 23
fundamentally illicit business models that threaten thejobs of millions of Americans in the creative industriesand, ultimately, our national economic welfare.” 100The role of government in facilitating thesepartnerships cannot be understated. In 2011, theEuropean Commission brokered a memorandumof understanding between rights holders andintermediaries that established “a code of practice inthe fight against the sale of counterfeit goods over theInternet and to enhance the collaboration between thesignatories including and in addition to notice andtakedown procedures.” 101 In doing so, the EuropeanCommission acknowledged that the existence of theMOU should impact the behaviour of organizations,including those who were not signatories. Underthe MOU Internet platforms committed to creatingproactive and preventative measures to protecttheir clients from the harms of infringing goods andindicated they were committed to voluntary noticeand takedown and would introduce policies to dealwith repeat infringers. 102 There are a vast numberof industry signatories including Adidas, Amazon,Burberry, eBay, Microsoft, PriceMinister, Unilever, theMotion Picture Association and Proctor and Gamble. 103Such government brokered MOUs give rights holdersand intermediaries the opportunity to work together toidentify strategies that meet the business needs of bothbusiness groups and protect the interests of consumers.Online retailers can also be important players in thefight against the sale of counterfeit and pirated goods.These refer to online retailers of third-party goodsand include auction sites and B2B retailers. 104 Onlineretailers and auction sites are in a position to developand enforce internal policies on the goods appearingon their platforms and thus can prevent counterfeitgoods from ever entering the marketplace. Fortunately,a number of online retailers and auction sites havevoluntarily developed policies on the selling ofcounterfeits and are beginning to enforce violations oftheir policies. PriceMinister, the leading French auctionsite, has voluntarily developed an anti-counterfeitingpolicy aimed at protecting customers. AlthoughPriceMinister has taken a consistent stand in the fightagainst piracy, its 2009 signing of a memorandumof understanding with the French minister of theEconomy to fight counterfeiting on the Internet hascertainly influenced its activity. 105100 Ibid.101 Memorandum of Understanding on the sale of counterfeit goods over the Internet, May 4, 2011. Available at: http://ec.europa.eu/internal_market/iprenforcement/docs/memorandum_04052011_en.pdf102 Ibid.103 Ibid.104 The Economic and Social Role of Internet Intermediaries, p. 12.105 Counterfeit Goods on the Web: PriceMinister Leads the Way in Europe, February, 2010. Available at: http://www.prlog.org/10524036-counterfeit-goods-on-the-web-priceminister-leads-the-way-in-europe.html24 Counterfeiting in the Canadian Market | The Canadian Intellectual Property Council
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