ALL OF EUROPE AFFECTED BY
COUNTERFEITING AND PIRACY
22 October 1998
International Forum on the Protection and
Enforcement of Intellectual Property Rights in the Transition Economies of Central and
Eastern Europe and the CIS
Organized by UN/ECE
Venue: Palais des Nations, Geneva, 26 October
1998
Counterfeiting of goods and the illegal use of
trademarks and patents continue to be widespread in the
transition economies of central and eastern Europe and is
affecting the entire region. Piracy worldwide in the automotive
parts trade, for instance, amounts to some US$ 3 billion
annually. This not only defrauds vehicle manufacturers, but, much
more seriously, threatens lives, as many of the illegal parts are
Alife-and-limb@ components of inferior quality and reliability.
AAlthough substantial improvements have been
made to intellectual property laws over the past five years or
so, enforcement is weak@ notes Mr. Geoffrey Hamilton,
Regional Adviser at the United Nations Economic Commission for
Europe (UN/ECE). The economic impact of this poor enforcement and
protection is difficult to quantify. However, it is certainly
limiting the growth of enterprises and, in some cases, leading
companies to reconsider or abandon plans for new or expanded
investment in the region.
To assist Governments in developing appropriate
intellectual property right (IPR) protection and enforcement,
UN/ECE has organized a Forum to discuss key issues and measures
to improve such protection and enforcement. The Forum, to be held
at the Palais des Nations, Geneva, on 26 October 1998,
will bring together representatives of international
organizations concerned with developing IPRs in the region,
Governments, private companies and law firms, as well as the
various institutions that deal with protecting and enforcing
intellectual property rights.
Discussions will focus on the significance of
such protection and enforcement for the transition economies, key
issues from the perspective of industry, the experience of
Governments in the transition economies, and enforcement
strategies.
Problems arise because, on the one hand, there
is a huge market for counterfeit goods from a population with low
average purchasing power and, on the other hand, there is poor
enforcement of the existing laws, standards and conventions. In
most transition economies of central and eastern Europe, the
judiciary, customs, police, patent offices and national
prosecutors have little or no experience in this area. Much
capacity building, training and support is needed.
The usual way to file a claim of infringement
is with a local court. The civil remedies sought may include
stopping infringement, compensating damages, publishing the court
decision at the expense of the infringer and removing the
infringing designation from the goods or their packaging in the
case of trademarks. In straightforward counterfeit cases,
litigation can be comparatively quick; however, with appeals and
other proceedings, a case may take a number of years. In some
countries, businesses are reluctant to proceed judicially. As
well as distrusting the efficiency of legal remedies, they often
believe that large-scale counterfeiters are controlled by
organized crime and that it is highly dangerous to act against
them.
A research-based pharmaceutical organization
has encountered problems in the transition economies of central
and eastern Europe as a result of the lack of strong patent
protection and enforcement. This company underscored the need for
the new improved laws that were introduced in the 1990s to be
backed up with effective, timely and equitable enforcement in the
courts. The launch of an infringing version of a medicine during
the period of patent protection can be extremely damaging to the
innovating company and very demotivating for further investment.
The effect of an infringing competitor is seldom effectively
remedied through an award of damages after a trial and it is
important that if infringement of a patent occurs, the infringing
product is quickly removed from the market. Hence, there is a
need for the timely and equitable provision of preliminary
injunctions ahead of the main trial.
The problems of counterfeiting and piracy
involve the entire region as well as neighbouring countries. A
sportswear company has suffered from counterfeit goods produced
in Turkey and Greece and smuggled through Bulgaria or the former
Yugoslav Republic of Macedonia into transition economies of
central and eastern Europe. These inferior quality goods were
then sold at very low prices on street markets. Problems also
have arisen in countries such as Finland, Sweden and Denmark,
owing to the imports of counterfeit goods from neighbouring
countries. Counterfeited goods were bought on street markets by
small-shop owners from Denmark and Finland and then resold in
their countries. Action was taken against these resellers in
Denmark, Finland and Sweden. In four cases, the goods were seized
and the shop-owners had to pay legal expenses as well as sign
affidavits never to sell counterfeits in the future.
In spite of the occasional success story,
enforcement practices in transition economies of central and
eastern Europe urgently need to be improved. During the Forum,
the experiences of a number of other enterprises, big and small,
will be discussed. As a result, Mr. Hamilton noted that Athe
Forum will conclude by adopting concrete recommendations to
assist these companies, as well as Governments, to ensure that
intellectual property rights are enforced effectively@.
Further details can be obtained from:
Mr. Geoffrey Hamilton
Regional Adviser, Trade Division
United Nations Economic Commission for
Europe (UN/ECE) Palais des Nations
CH - 1211 GENEVA 10, Switzerland
Tel: (+41 22) 917 2838
Fax: (+41 22) 917 0037
E-mail: [email protected]