Enforcement in Asia Pacific


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Enforcement in Asia Pacific

  1. 1. Enforcement in Asia Pacific prepared by rouse & co. international November 7, 2007
  2. 2. The Enforcement Toolbox <ul><li>Administrative </li></ul><ul><li>Enforcement </li></ul><ul><li>simple, quick, cheap </li></ul><ul><li>low deterrent value </li></ul><ul><li>seizure of goods </li></ul><ul><li>can be “stretched” </li></ul><ul><li>Customs </li></ul><ul><li>good organisation vital </li></ul><ul><li>random results </li></ul><ul><li>most cases valuable </li></ul><ul><li>training essential </li></ul><ul><li>transnational </li></ul><ul><li>Civil Litigation/ADR </li></ul><ul><li>complex, expensive </li></ul><ul><li>tactics and venue are key </li></ul><ul><li>compensation possible </li></ul><ul><li>allows for creative solutions, </li></ul><ul><li>lasting results </li></ul><ul><li>Criminal Prosecution </li></ul><ul><li>complex & expensive </li></ul><ul><li>evidence value high </li></ul><ul><li>usually stronger deterrent </li></ul><ul><li>need preparation </li></ul>CUSTOMS PROSECUTION ADMIN. LITIGATION
  3. 3. Administrative cases vs. IP litigation in China
  4. 4. <ul><li>Raids have been most effective against mid-sized operations—but counterfeiters are highly adaptive </li></ul><ul><ul><li>Changing supply chains in response to inspection. Reducing volume to avoid raids and criminal prosecution. </li></ul></ul><ul><li> Big counterfeiters are protected by size, corruption, and their own “IP” </li></ul><ul><ul><li>Years of raiding have left many mid-sized counterfeiters with two choices: get out or get big. </li></ul></ul><ul><ul><li>Meanwhile, smaller counterfeiters remain below the radar—administrative action is not cost-effective and criminal thresholds cannot be met. </li></ul></ul><ul><li> Administrative authorities realizing that they are an anomaly </li></ul><ul><ul><li>The AIC cannot assess damages and award compensation. </li></ul></ul><ul><ul><li>As counterfeiters more sophisticated they have begun to challenge AIC decisions in court. </li></ul></ul>The current state of enforcement in China
  5. 5. <ul><li>Who’s going under the radar? </li></ul><ul><li>Small trading companies, internet retailers, and myriad sellers on eBay, B2B and B2C marketplace sites </li></ul><ul><ul><li>Counterfeits shipped directly to US and EU consumers through courier services </li></ul></ul><ul><ul><li>Products sourced from local markets and small factories—volumes are kept low to minimize the risk of seizure </li></ul></ul><ul><li>Factories produce counterfeits off-hours in small batches while most regular production has shifted to unbranded goods </li></ul>The disappearing middle
  6. 6. <ul><li>Who’s growing? </li></ul><ul><li>Ghidorah : </li></ul><ul><li>The Three-Headed Monster </li></ul><ul><li>A single enterprise may be involved in… </li></ul><ul><ul><li>OEM for major brands </li></ul></ul><ul><ul><li>Counterfeits and backdoor sales of its customers’ products </li></ul></ul><ul><ul><li>Marketing its own competing brand </li></ul></ul><ul><li>Even as its own brand begins to mature, counterfeiters find their old streams of income difficult to abandon. </li></ul>The dis appea ring middle
  7. 7. Litigation in China
  8. 8. Where do you turn? <ul><li>Increasingly, it’s litigation </li></ul><ul><li>But, to be effective against global counterfeiting requires either— </li></ul><ul><li>a regional rights protection platform and strategy that enables you to take action locally; or </li></ul><ul><li>a localized program that is targeted and efficient, aimed at the smaller counterfeiters. </li></ul>
  9. 9. Global counterfeit supply chains <ul><li>Targeted regional enforcement strategies </li></ul>Coordinated information and evidence platform Regional Customs Training Trade fair Monitoring Database Investigation Company Training Licensees Supply Chain Database Internet Profiling
  10. 10. Zhejiang Factory Shanghai Export Co. Singapore Transit IntendedMarkets Court order to seize goods failed Dubai Seizure x 2 containers Markets
  11. 11. Guangzhou arrests Shantou Factories Dubai Transit Rotterdam Customs seizure 8 pharma brands Criminal prosecution Traced back to Nigerian importer Markets in Europe
  12. 12. the end Please contact: Joshua Mandell Email: jmandell@iprights.com
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