Panel: Seek Innovative Solutions Vs. Counterfeiting; Oxfam Warns Against False Solution

PARIS – The rise of counterfeiting and global economic difficulties have combined to sap resources devoted to intellectual property enforcement, said panellists at an event highlighting the fight against counterfeiting and piracy yesterday, and discussed innovative solutions. Meanwhile a civil society group said enforcement of IP rights is a false solution to substandard medicines.

The sixth Global Congress on Combating Counterfeiting and Piracy, co-organised by the World Intellectual Property Organization, the World Customs Organization, and Interpol, closed its doors yesterday after two days of an intense exercise of devising enforcement strategies, contemplating potential commercial losses, and warning of harmful effects of counterfeiting.

Vinko Fodich, head of the Control and Sanctions Unit at the Chilean Ministry of the Interior, said the country had created a collaborative committee which constitutes an information exchange platform between the public and private sector. In Chile, he said, IP crimes have a high social tolerance and there are no citizen denunciations. In 2010, he said, some 90 percent of inquiries were initiated by police officers, and only four percent started after a company or an individual reported infringement.

A “new chapter” in the Russian penal code has been written on the seizure of infringing goods and production equipments, said Tatiana Gerasimova, first deputy chief of the Investigative Committee of the Ministry of International Affairs of Russia. Over 6,000 declared infringement cases were recorded in 2010 in Russia, she said, and over US$50 million worth of goods were seized, including audiovisual equipment, food, and cosmetics.

According to a Russian international affairs inquiry committee, the market is being “flooded” by counterfeit goods and stopping this flow is very difficult, Gerasimova said. A lot of counterfeit goods are sold on the internet and the unwillingness of internet service providers and internet users to collaborate renders the fight arduous. It is very difficult to find out who is behind infringement on the internet as a very sophisticated system of hidden files allows counterfeiters to only post links to infringing content but no actual infringing content on their internet protocol address.

Criminals do not have the same financial hurdles that legitimate businesses have, said Andrea Sharrin, deputy chief of the Computer Crime and Intellectual Property Section of the United States Department of Justice. In the context of difficult global economy, “we all feel the pinch,” she said, but criminals do not have to finance research and development, pay taxes, or care about safety regulations. The solution to maximising limited resources is efficiency, and careful selection of targets. Laws have to keep pace with rapidly changing technologies, she said, and countries must engage in capacity building to “reduce safe havens around the world.”

An increased collaboration with the private sector is needed, along with greater public awareness and strong prosecution, according to Sharrin, who said that the US Federal Bureau of Investigation had dedicated some investigators to the sole purpose of investigating IP crimes.

For John Newton, programme manager in the IP Rights Programme at Interpol, it is necessary to generate private and public sector funds. At the moment, 90 percent of Interpol funding comes from the public sector, with a maximum of 10 percent of the funding coming from the private sector, Newton said. It is important to choose the right partners, he said.

To a question from the audience asking if taking funds from the private sector did not constitute a potential conflict of interest and questioned the impartiality of enforcement, Newton said Interpol should define on what circumstances they could accept funds from the private sector. He acknowledged that it would “kill the programme overnight if we are perceived as being in the pocket of a company,” he said. Funds would also come from an array of different industries.

According to Michael Blakeney, director of the Australian Global Studies Research Center, there are “immense resources available for the funding of IP rights enforcement,” and those resources lay in confiscated goods.

Counterfeiters do not have overheads, he said, so a large proportion of the turnover is profit and “that profit is available.” The recently completed Anti-Counterfeiting Trade Agreement includes in its Article 25 a provision on seizures, but confiscation legislations already exist in a number of countries in the world, he said, where part of the profits coming from seized goods are allocated to the enforcement effort.

A new international anticounterfeiting institution sponsored by French drugmakers Sanofi Aventis will provide training and a collection of information on fake medicines and health products, according to Jacques Franquet, director of the Institut International contre la contrefaçcon des médicaments. One of the institute’s missions will be to raise patients’ awareness. The institute is independent, said Franquet, and will provide exhaustive online documentation, with a particular focus on training sessions. It hopes to diversify its funding through public and private partnerships.

In a related development, David Finn, Microsoft associate general counsel for worldwide anti-piracy and anti-counterfeiting, warned in a blog about software piracy risks being greater than ever.

De-Linking IP from Fight against Poor Quality Drugs

Meanwhile, Oxfam, in a briefing paper published on 2 February, said that the “proliferation” of poor quality medicines in developing countries was being “used by rich countries as an excuse to tighten intellectual property rules, boosting the profits of large pharmaceutical companies while making it harder for poor people to get access to the medicines they need.”

The paper titled “Eye on the Ball,” says that as much as 44 percent of certain types of medicines in developing countries are substandard, but expanded IP rules in poor countries is a false solution. That’s because anti-counterfeiting measures are “limited in scope and fail to address the broader public health problem of substandard and falsified mecidines, which pose a danger to public health but do not necessarily infringe IP rights.”

The organisation called for increased investment in drug regulation instead of anti-counterfeiting measures.