Experts urge collaboration and education as e-commerce and advanced technologies threaten brand protection

With the proliferation of e-commerce platforms and the development of innovative technologies, counterfeiters are constantly evolving and redesigning their methods. In this context, it has never been more important to understand the biggest threats facing brands so that they can stay one step ahead. WTR asked the authors of the latest issue A guide to anti-counterfeiting and online brand enforcement to share their insights on these issues and highlight key issues that brand owners should consider in their anti-counterfeiting strategies.

While advanced technology is a huge problem, it is also a solution; experts believe that anti-counterfeit technology is crucial to an effective mitigation strategy. Education and cooperation between e-commerce platforms, brand owners, law enforcement and judicial authorities are also essential to maximize enforcement of illegal trade – both online and offline.

Bad actors are increasingly able to evade detection as e-commerce platforms turn out to be ‘treacherous’

Counterfeiters “exploited the anonymity of the Internet,” say Saif Khan and Meghana Kudligi of Anand and Anand. In fact, it is not surprising that e-commerce platforms play such a key role in facilitating counterfeit activity on a global scale, given the ubiquity of the online world.

With the growing trend of “long-trusted retailers opening their online platforms to unknown third-party sellers,” Adams and Reece’s Maia Woodhouse and Kristina Montanaro Schrader express their concern about the resulting influx of counterfeits onto these platforms and, in turn, the growing number of consumers who unknowingly buy products that are assumed to come directly from the brand owner.

In addition to the threat from third-party sellers, counterfeiters are targeting consumers with “treacherous” baits such as hidden links to second-tier sites, says Cesare Galli of Galli’s Intellectual Property Rights department. According to Heer Law’s Georgina Danzig, these malicious tactics are becoming more sophisticated and allow counterfeiters to avoid detection and limit liability.

Rafael Lacaz Amaral of Kasznar Leonardos also expresses concern that counterfeits on e-commerce sites facilitate “large-scale distribution, challenging authorities’ monitoring and control,” limiting the ability of authorities and brand owners to combat perpetrators.

Bad actors are also taking advantage of the proliferation of video e-commerce – where products are sold via live video feeds. Ellalan’s Alan Chiu, James Choi, Nicole Huo and Nicola Kung warn that the “unpredictable nature” of live-streaming sales makes it extremely difficult for authorities to track and trace activity, making it difficult for authorities to monitor, obtain and it is almost impossible to store evidence of infringement.

Cutting-edge technology creates new challenges for brand owners

For Amaral and Raquel Barros, the growing sophistication of the counterfeit network and the use of advanced technology to create near-identical replicas poses a big problem for brand owners and authorities. This is also a serious concern for Reinhard Fischer and Tamara Moll of Cohausz & Florack, because this is exactly what generative artificial intelligence and deepfake technologies can do. “Deepfake technology and advanced counterfeiting techniques now make it possible to create near-perfect replicas of products, documents and digital identities,” they warn. “Cryptocurrencies add another layer of complexity by facilitating anonymous illegal transactions,” they add.

Fighting technology with technology

Despite recognizing advanced technology as a major threat to anti-counterfeiting efforts, many trademark experts also cite it as a solution.

“Artificial intelligence is currently a parasite and symbiosis of global trade,” say Danzig and Dzisiak. While AI poses countless obstacles in the fight against counterfeiting, it also has enormous potential to alleviate problems faced by authorities and brand owners. Brand owners are implementing artificial intelligence and machine learning tools to “strengthen their supply chains, analyze and predict patterns of counterfeit activity, and proactively identify potential threats online and in the field,” Danzig and Dzisiak note.

Similarly, Davide Luigi Petraz and Daniele Giovanni Petraz of the GLP Intellectual Property Office advocate the use of artificial intelligence to overhaul current anti-counterfeiting tools and create “cross-cutting technologies that would make it possible to trace the production chain even in the digital market.” . Fischer and Moll also advocate for AI’s ability to “analyze and predict counterfeiting patterns to identify potential threats early.”

For some, digital authentication technologies are the solution of the future. Amaral suggests the use of holograms and RFID tags, while others point to blockchain as a key tool to reduce the threats of counterfeiting. “Blockchain-based solutions can provide end-to-end supply chain visibility and product authentication,” say Khan and Kudligi. The fashion industry in particular is pioneering the use of blockchain technology to verify the authenticity of luxury goods, according to a report by Fischer and Moll, pointing to the Entrupy app as a key example. Nano-optics also play a significant role in improving design rights protection and offer holographic packaging features that are “almost impossible” to copy – an invaluable tool to have in any anti-counterfeiting arsenal, Fischer and Moll add.

Brand owners can also use data analytics to “collect data from e-commerce platforms and monitor infringement patterns.”, report Chiu, Choi, Huo and Kung in Ellalan. Meanwhile, Master Ananda and the representatives of Ananda ““robust cybersecurity measures and maintaining close surveillance on the internet” as an effective approach to combating illegal activity online. “Investing in advanced authentication technologies (e.g. digital watermarking and blockchain) can increase product traceability and verification,” they add.

Education and regular training are essential

A major problem in the consumer goods industry is a lack of “understanding of what counterfeiting is and what risks counterfeit goods pose, both financially and health-wise,” says Michael Lamont of Spoor & Fischer. The natural cure is education.

One of the most effective strategies to mitigate the effects of counterfeiting is to educate brand owners, consumers and law enforcement. Fischer and Moll emphasize that regular training of law enforcement, customs and border protection authorities on how to recognize counterfeits is crucial, as well as educating consumers on how to recognize genuine products – an initiative they consider “a powerful tool in this fight.”

Possibilities of creating new legislation

“Several jurisdictions have proposed or adopted laws imposing liability on online marketplaces for third-party sales of counterfeit goods on their platforms,” Schrader and Woodhouse report. This points to a growing trend toward regulating e-commerce markets, which represents what Schrader and Woodhouse call “an incredible opportunity for rights holders (and intermediaries) to evaluate such regulations, either directly or through organizations such as INTA, before implementing them.” “.

Similarly, Galli reveals that the fight against counterfeiting in Italy “is enabling new strategies” for interested parties, in particular through border controls that are “becoming more and more effective and followed by criminal proceedings.”

Elsewhere in South Africa, Lamont said, government support for fighting counterfeiting has “increased dramatically.” “This enables brand owners to take action against the sale of counterfeit goods in countries that were previously considered impossible,” he says.

Introducing the rules of cooperation

Trademark experts advocate the collaborative opportunities that come from anti-counterfeiting efforts. Integration and cooperation between government agencies, private companies and international organizations create an environment that is “more resistant to illegal activity,” Barros says. Cooperation between e-commerce platforms and brand owners is essential to quickly remove suspicious offers, he adds.

Brand owners must also “maintain close working relationships with local intellectual property or brand protection associations, local administrative bodies and customs authorities,” Ellalan insists.

Given the global and cross-border spread of counterfeits – both online and offline – Lamont argues that “meaningful engagement… between brand owners and law enforcement officials” is paramount to effective enforcement.

The Anti-Counterfeiting and Online Brand Enforcement Guide combines the latest strategic analysis with practical, country-by-country exploration of the best protection around the world. The latest edition is available Here.