US manufacturers body unveils blueprint for fighting fakes

The National Association of Manufacturers (NAM) in the US has called for e-commerce platforms to do more to tackle the trade in counterfeit goods.

In a just-published white paper, the NAM lays out a series of recommendations that it says would help curb the trade in counterfeit goods, which according to its estimates cost the US economy $131bn – and 325,000 jobs – in 2019 alone.

Top of its list is measures requiring e-commerce companies like Amazon, eBay and Wish – which it says are “captive to counterfeits” – to reduce the availability of counterfeits on their platforms.

Congress should enact legislation to require the companies to screen potential third-party vendors upfront – or face liability for infringement carried out by them.

That includes making sure they identify and verify vendors – legislation on that has already been proposed in both the House and Senate – and keep those records up to date. Screening should take place before goods are put on sale to ensure that previously disqualified vendors or products do not reappear.

They should also require sellers to attest “with appropriate proof” that the goods they are selling are authentic, they don’t use unauthorised images, and the images accurately depict the goods being sold.

Congress meanwhile should enact legislation that requires e-commerce platforms to remove counterfeit vendors and products from their platforms quickly – using screening technologies that can spot fake listings quickly.

That legislation should also require the platforms to carry out rapid takedowns of listings and termination of vendor accounts.

Many e-commerce platforms say they already have such measures in place, but legislation could help force greater efforts, particularly if the counterpoint to the requirements is that failure to implement introduced liability.

NAM also thinks Congress should allocate emergency funding to boost enforcement against fraudulent products claiming to have a role in the COVID-19 pandemic, such as test kits, medicines, personal protective equipment and other health supplies.

The white paper also says that there are gaps in current US statutes – plus a lack of case law – that have allowed e-commerce platforms to avoid being held liable for contributory trademark liability, even where they fail to take sufficient actions to address counterfeits.

It also claims that enforcement bodies “lack modern legal authorities, resources and tools that are effective against counterfeiters,” and says Congress should remedy the situation by clarifying the legal doctrine of contributory liability for trademark infringement cases. e-commerce platforms should also be held to the same standards as brick and mortar retailers, says the NAM.

The report also suggests a new White House agency should be created that holds primary responsibility for US anti-counterfeiting efforts, including strategy, policy and enforcement, and could function as a point-of-contact between the private sector and other stakeholders.

Manufacturers should share information on counterfeiting operations, which are increasingly being linked to organised crime networks, and work collectively to improve brand protection efforts.

Consumers are “not sufficiently aware or concerned about the direct danger that counterfeit products can pose—not just to businesses, but directly to themselves,” says the report, and online retailers should be required to notify online shoppers about actual or potential purchases of counterfeit goods to help raise awareness.

“E-commerce has created a pipeline to consumers that counterfeiters can exploit while hiding their identities and evading oversight,” says the NAM.

“Manufacturers need real, actionable, innovative policy solutions that reverse the rising tide of counterfeit products.”