Anti-Counterfeiting
Campaigns: Strategies for Thailand
Copyright
2001
Edward J. Kelly, Esq., David Lyman Esq.
Tilleke & Gibbins International Ltd.
V.
Supplemental or Complementary Options Available
Given
the perceived dissatisfaction with the results obtained via traditional
enforcement mechanisms based strictly on IP law, new strategies based
on existing Thai tax and commercial law should also be considered when
formulating a game plan to target infringers. These laws, set forth below,
are enforced by a multitude of agencies in addition to the police. The
enforcement of these other laws is far more popular with the government
and the general populace because violations are considered public crimes
as opposed to the supposed "victimless" private crimes against
only trademark owners. If action through these other government agencies
can complement or supplement claims based on intellectual property violations,
then the objective of keeping counterfeit products out of the market may
be brought closer within reach.
Any
outline of a possible action plan should include as its realistic objectives
a marked slowdown of the domestic production and sales, export and import
in international trade of counterfeit products and components. To accomplish
measurable results, trademark owners, their licensees, agents, distributors,
dealers, lawyers and investigators should operate in close and long-term coordination with one another to
protect the rights and value conferred by trademark protection.
Trademark
owners with little familiarity of the Thai market should be aware of areas
with large amounts of counterfeit products in Bangkok, including Sukhumvit,
Silom, Pratunam, Ramkhamhaeng, Banglumpoo, Patpong (all tourist areas
of Bangkok) as well as the yards of freight forwarders, consolidators
and carriers for those fake products exported by land, sea and air.
Any
effective action plan should consider retainer of public relations firms
with experience in counterfeiting suppression to create awareness of public
and target groups. We find that targeted, i.e. selected, senior Thai government,
parliamentary and police officials, when informed of potential public
relations and suppression campaigns, are much more amenable to support
of enforcement efforts.
We
have also found that the trademark owners who establish direct "hot
lines" with people who are willing to act, at various stations/agencies
(Interpol, Customs Department, Internal Revenue Department, Excise Department,
Labour Department, Immigration Division, Industrial Works Department,
Environmental Agency, FDA, etc.) often achieve measurable results faster
than those owners relying on only traditional watchdog agencies to monitor
markets for counterfeits.
Culturally,
it is important to involve an owner's local Thai licensees, agents, distributors
and dealers of protected/branded goods in any enforcement campaign. Local
influence and connections could be useful in facilitating anti-counterfeiting
actions. Furthermore, Thai people and Thai government officials are more
likely to listen to the complaints of Thais than of foreigners.
When
a particular raid action captures substantial quantities consideration
should be given to the notification of the Revenue and Excise Departments
for possible investigations and punitive actions on tax evasion by counterfeiters
(VAT, corporate and personal income taxes, excise taxes, etc.).
Similarly,
one might notify the Labour Department to check child and women labour
conditions at any manufacturing or retail operation that is suspected
of involvement in counterfeiting activity for legal compliance. One might
also inform the Labour Department of the possibility that foreigners,
involved in the counterfeit business and the export of fake goods, may
not have proper work permits.
A similar
strategy to create the proper deterrent environment would involve tipping
off the Immigration Department in respect to known foreigners involved
in counterfeiting who are working in Thailand under inappropriate visa
status.
Where
infringing medicinal or pharmaceuticals are found, one should notify the
Thai FDA and the Ministry of Pubic Health of the possible use of inappropriate/toxic
dyes, chemicals etc. in the production of the counterfeit goods. One should
also be vigilant for product labeling violations which would come under
scrutiny by the FDA. In relation to this, there is also the possibility
of notifying officials of violations of the Consumer Protection Act.
It
is possible to notify the Ministries of Industry, Interior and Environment
of factories operating without licenses under factory laws, and/or violations
of labour laws, health and safety laws, environmental laws, etc. One can
request the closure of these factories if violations are found during
a raid action. Likewise, one can request the Fire Brigade and Building
Inspectors to check the conditions, e.g. fire safety conditions, of counterfeiters'
premises, especially the conditions in small old shophouses, and then
press for the possible closure of these "factories".
If
a trademark owner becomes aware of a shipment of counterfeit goods, he
should use his right and inform the Customs Department to seize the counterfeit
products. Customs officials have the authority to board all vessels, open
all containers, and seize all offending goods. The trademark owner or
representative must be present and should be prepared to be responsible
for all expenses incurred should the goods found not be counterfeits.
Customs officials will upon request dispose/destroy the seized goods accordingly.
There are obvious impracticalities in this method of enforcement. A full
discussion of Thai Border Control Measures for suppression of counterfeiting
activities is submitted with this paper.
VI.
Practical Realities: Constraints and Limitations Associated with Enforcement
Efforts
Generally,
a trademark owner must be prepared to commit significant resources for
any truly effective campaign. Costs will include special agents'/investigators' fees for conducting raids; legal incentives and rewards given and accepted
by the police and/or other officials (authorized under Thai law: "Title
38, Incentives and Rewards, Chapter 1, General Principles Concerning Payments
and Rewards," and is contained in the regulations of the Police Internal
Manual); rewards for informers; and naturally, legal fees.
Besides
the costs involved, one should also take an informed view of the proliferation
of offenders and historical tolerance of counterfeiting, which has not
been culturally viewed as a criminal activity. There is as yet no real
broad-based Thai public sentiment to protect IPRs. The Thai authorities
and the public give priority to offenses relating to national security,
tax evasion, public order, and exploitation of people.
Worth
noting as well is the very real threat of physical violence by the counterfeiters
or their fellow travelers to the personal safety of trademark owners,
representatives, licensees, distributors, law firms and investigative
personnel, police. The gravity of the danger increases with the success
of suppression efforts.
Conclusion
The
good news is that as a result of petitions by trademark owners to their
respective governments to review Thailand's eligibility for trade benefits,
the present Thai Government Administration has rededicated its attention
to the importance of IPRs in Thailand. On July 13, 2001, at the insistence
of Prime Minister Thaksin Shinawatra, a formal meeting under the supervision
of the Minister of the Interior was held and an action plan developed
to address the legitimate concerns of IPR holders. As a result of the
meeting, a permanent working committee was established with an express
commitment to the suppression of intellectual property infringement. In
the current political environment, it is advisable for trademark owners
to cooperate with and assist the new government initiative by vigorously
acting to defend and enforce their valuable marks against infringement.
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