New thinking is required if the online counterfeiting threat to businesses and consumers is to be tackled effectively and at scale.
Intellectual property infringement online is an epidemic and is putting consumers at risk. Sitting at the heart of the issue is the sale of a counterfeit goods through websites, online marketplaces and social media.
Corsearch has undertaken new research into the role search engines play in directing unwitting consumers to locations selling fakes. The research focuses on counterfeit pharmaceuticals, children’s products, automotive parts and safety equipment.
A global anti-counterfeiting response required
A recent OECD report, published in March 2019, warns that the value of trade in counterfeit goods is US$509 billion, or 3.3% of all world trade. The report notes sub-standard products such as fake car parts, cosmetics and electrical goods put consumer safety at serious risk. The 2018 Electrical Safety First report found that 30% of UK consumers have been duped by fake electrical goods. For pharmaceuticals, the World Health Organisation reports that an estimated 1 in 10 medical products in low- and middle-income countries is substandard or falsified.
Counterfeiters are not regulated, do not comply with safety standards and have no incentive to ensure consumer safety. They do not invest in research and development, do not pay taxes and often exploit workers to make products at low cost in poor conditions. Counterfeiting is also known to fund organised criminal activity and terrorism.
The role of internet intermediaries
All internet intermediaries are able to play a role in upholding the law and preventing harm. They are the operators that build substantial and profitable businesses by providing the online infrastructure: hosting websites, supplying domain names, enabling Internet access, distributing online material, supporting Internet advertising and facilitating online payments etc.
Search engines are a core internet intermediary. They are the focus of our upcoming White Paper. They are extremely powerful tools with the technological power to index everything that is online, anywhere in the world.
Threats to consumer safety
The world’s information includes internet locations that sell products that cause very significant harm.
When consumers use the internet to search for locations offering consumer products such as pharmaceuticals, baby teethers and safety helmets, up to 60% of the search results returned can be for locations selling counterfeit products. Counterfeiters use search to get to the customers that they want.
The problem is massive – a big problem that requires a big solution.
Where does the law stand?
Hosting intermediaries like Facebook, Amazon and eBay are protected from any liability for damages where they operate as the passive host – but they lose this “privilege” when they are notified of a particular infringement on their platform.
Search engines, on the other hand, are not host intermediaries. They take the view that they do not need to take any action when they are told about a counterfeit site indexed in their search results.
However, that difference in legal treatment is changing. Case law is developing that may ultimately present a liability challenge to search engines once they are put on notice.
In a series of precedent setting cases in Canada, the United Kingdom and France, it has been established that courts can require search engines to de-index a website.
An opportunity to set the standard for intermediaries
Search engines need to get ahead of the game. In doing so, they can demonstrate their willingness to proactively engage in anti-counterfeiting solutions.
Our ask is simple: by pivoting on their current position to work with rights holders and companies like Corsearch, search engines can act in the interests of the online consumer.
If they sit back and refuse, case law that is more dramatic may come calling.
White paper: search engines can and should implement a scaled anti-counterfeiting solution and remove locations from their search results
Corsearch’s brand protection technology harnesses smart automation and AI-enhanced data detection technology to discover the most damaging infringements. If you’d like to find out more about how Corsearch’s brand protection technology focuses on the biggest threats, you can request a demo below.
This blog was originally published on the Incopro website.