The path ahead
This year is a transition one for the International Trademark Association (INTA). We are concluding our 2014–2017 Strategic Plan and preparing for the implementation of our 2018–2021 Strategic Plan, which we plan to unveil during the opening ceremony at our 2017 Annual Meeting in Barcelona, Spain, in May.
While we continue to expand our geographic and substantive scope on many fronts, our policy priorities for the year are counterfeiting, internet governance and expansion, and brand restrictions.
Counterfeiting: the numbers speak for themselves
Counterfeiting is the most important IP issue facing brand owners and consumers today. It directly affects national security and the global economy, and poses significant health and safety risks. Counterfeiting is a profitable, low-risk, high-reward business with high profit margins and low manufacturing costs. Many counterfeiters have established complex criminal networks with supply chains and processes to manufacture and distribute their illicit goods.
The growing economic impact presented by counterfeiting is underscored in the findings of a few recent key research studies. Ten years ago, worldwide counterfeiting was valued at an estimated $250 billion and accounted for 1.8% of world trade. Last year, a report by the Organisation for Economic Co-operation and Development (OECD) estimated that by 2013 these numbers had risen to $461 billion and 2.5%, respectively.
Further, a 2017 report commissioned by INTA and the International Chamber of Commerce–Business Action to Stop Counterfeiting and Piracy (ICC-BASCAP), forecasts that international trade in counterfeiting will more than double over the next few years, to $991 billion by 2022. There is no doubt that the counterfeiting trade is expanding.
By one estimate, within five years’ time more than 70% of the world’s population will have access to the internet. Counterfeiters are well aware of this trend, and their illicit goods are in abundant supply across the world wide web.
"Dialogue between stakeholders globally is a key component of INTA’s advocacy strategy."
These criminals are able to hide behind the anonymity of the internet and sell to consumers globally. They can then further deceive consumers by displaying genuine goods on a website and then shipping the counterfeit goods. It is evident that international criminal networks are creating hundreds of sites—on servers across multiple jurisdictions—selling the same counterfeit products.
Establishing a global anti-counterfeiting network
Anti-counterfeiting advocacy involves many players, including rights owners, customs officials, law enforcement, legislators, IP offices, intermediaries, and consumers. To address this challenging issue, this group must establish a multi-stakeholder anti-counterfeiting network that includes the following elements:
Coordinated law enforcement efforts across jurisdictional boundaries;
Cooperation with intermediaries;
Judiciaries that impose substantial penalties;
Rights owners working together, as they do in industry and trade associations;
Partnerships between the private and public sectors; and
Industry helping governments to understand the practical implications of policy, regulatory, and legislative decisions.
INTA’s goal is to convene these stakeholders, to open communication channels between them, and to foster meaningful collaboration among them. Indeed, dialogue between stakeholders globally is a key component of INTA’s advocacy strategy.
The association’s anti-counterfeiting initiatives are spearheaded by its anticounterfeiting committee with the guidance and support of the INTA staff. The committee has 272 members worldwide, representing 72 brand owners plus law firms, brand protection experts, and investigators. They are the experts in their regions and help INTA with its advocacy efforts in combating counterfeiting. The committee’s work includes:
Issuing comments on laws and regulations dealing with counterfeiting;
Holding policy dialogues to foster collaboration between stakeholders;
Meeting frequently with government officials to discuss the state of IP and counterfeiting; and
Providing training and resources for customs officials, IP offices, and brand owners.
In terms of training, in 2016 INTA launched its Customs Connection webcast series. The webcasts provide customs officers around the world with product identification training directly from brand owners. INTA regularly sends delegations to engage with government officials. In 2017, the association has already organised meetings in Canada, China, and India. In addition, we have held successful online counterfeiting policy dialogues in China, Hong Kong, India, Italy, the Philippines, Singapore, and Thailand.
Brand protection online
The internet is an integral part of our daily lives and is central to the operation of our businesses, stock markets, and government agencies. Global business-to-consumer e-commerce is growing at a very rapid rate. In 2012, it surpassed $1 trillion. By 2015, it had more than doubled, to $2.2 trillion. Issues relating to internet governance and the expansion of the domain name system have come to the fore in recent months. They present a multitude of challenges to the protection and enforcement of trademark rights online.
INTA serves as a leading voice for brand owners in the evolution of the internet. It is a founding member of the IP Constituency within the Internet Corporation for Assigned Names and Numbers (ICANN). The association is working to ensure that trademarks receive the same protection on the internet as they do in the bricks-and-mortar world, and that consumers can make safe, reliable, and informed choices about the products and services they seek online. Brand owners’ voices are critical to the security and stability of the internet, as brand owners are on the front lines of the fight to protect consumers from fraud and abuse.
Internet governance
On October 1, 2016, the US government allowed its contract with ICANN to expire. Governance of the key internet domain name functions effectively transitioned to a global multi-stakeholder community. This was a tremendous milestone for the global internet community, underscoring both the profound complexity of the world wide web and the fundamental role that the internet now plays in the global economy and in our daily lives.
Following the transition, the internet community gained the power to remove any or all of the members of the ICANN board, the results of independent review decisions will be binding, and the ICANN board and staff will be subject to new accountability measures that are currently being negotiated.
At present, one component of policy development, known as “Work Stream 2”, is looking at nine major areas of concern with regard to ICANN accountability and impact.
Of the nine, the two key areas of interest for INTA are (1) jurisdiction and (2) transparency. The association, through its internet committee, is playing a key role in ensuring that ICANN fulfils its obligations to maintain a secure, stable, and resilient internet. INTA members are participating in key review processes that have a direct impact on the ability of brand owners to protect their names in the domain space.
Internet expansion
In 2012, the new generic top-level domain (gTLD) programme was launched. The introduction of new gTLDs has created new opportunities and challenges for brand owners. While some have chosen to launch domains for their ‘dot brand’ and create new channels for brand awareness, many are monitoring the programme to ensure that their brands are protected within the new domains. INTA continues to advocate for rights protection mechanisms to help brand owners police and protect their brands.
All the rights protection mechanisms are currently under review, and INTA has issued a call to action for all brand owners to become involved in this process. Review of the Uniform Domain-Name Dispute-Resolution Policy in particular, and of rights protection mechanisms generally, is essential for (1) access to reliable, accurate, and contactable domain registration data; and (2) allocation of future new gTLDs, including the dot brands.
INTA’s efforts with regard to internet governance and expansion are undertaken with the goal of ensuring that the ongoing innovation of the internet is balanced with the need to address trademark infringement online. The association encourages the trademark community to remain vigilant and safeguard the rights enjoyed under ICANN.
The spread of brand restrictions
INTA is concerned about growing restrictions on brands and trademark use. We are seeing increased regulations and legislation to restrict brand use, including plain and standardised packaging, which reduces the use of trademarks on packaging or even bans them altogether.
Much of the focus has been on plain and standardised packaging for tobacco products. Governments have justified these brand restrictions as a public health issue, without regard for trademark rights. However, brand restrictions are increasingly being applied to non-tobacco products as well. For example, we have observed brand restrictions on baby formula and on fast-food items such as pizza.
Since 2005, the World Health Organization has increased its anti-tobacco campaign and has begun targeting other consumer goods. In 2012, the brand restriction issue attracted global attention when Australia enacted legislation mandating plain packaging for tobacco products. Then, a claim was filed with the World Trade Organization (WTO) that Australia’s law violated the TRIPS Agreement. In 2015, INTA submitted an amicus brief to the WTO Dispute Resolution Panel; the panel’s decision is expected this year.
In spite of the pending WTO case, a number of countries, primarily those with advanced economies, enacted plain packaging legislation for tobacco products. The seriousness of the threat to brand owners’ rights led INTA’s board of directors in 2015 to approve a resolution reinforcing the association’s longstanding position on the issue of plain and standardised packaging.
The resolution cites violations of various international treaties regarding IP rights, and calls for governments to reject or repeal plain packaging legislation and to use less drastic alternatives, such as public education campaigns, to address health and safety goals.
INTA has pressed governments to take a balanced approach when considering how to address the public health issue in order to ensure the integrity of their IP systems as a means to promote investment and economic growth. The association has filed submissions on this issue with governments in more than 20 jurisdictions across Africa, Asia, Europe, and the Americas.
INTA remains committed to seeking paths to address the threat of brand restrictions by emphasising the need for alignment of policies on IP rights and public health in order to advance economic and social welfare.
Joe Ferretti is INTA president and vice-president and chief counsel, global trademarks for PepsiCo. He can be contacted at: communications@inta.org
