|
|
| • EXCH RATES |
|
Baht/$ 33.67/70
Bid/Ask
|
GOLD |
14,600
Unchange
|
|
BY INVITATION
CHANSIN TANGBURANAKIJ
In the first part of our article yesterday, we looked at the overall change in the source of counterfeit goods in Thailand and related reasons for this; today we focus more on the Thai end of operations. While the actual sale of counterfeit products in the Thai market is still high, the amount of goods in possession of any one infringer at any one time is much smaller than in the past because the turnover rate of counterfeit products is higher.
Distributors of fake goods purposely keep the amount of stock in their possession small for two reasons: economic and legal. In the past, supplies could never be guaranteed. When retailers sold out of stock they could not be certain when they would be able to obtain new supplies. As a result, they tended to buy stock in bulk to avoid being caught short and unable to obtain new supplies at short notice. This is no longer a problem as the supply networks are now well established and replacement stock can be obtained more frequently, efficiently and flexibly.
It has been seen that the amount of counterfeit products in most shipments is considerably lower than in the past; however, the total number of shipments has increased manyfold. With smaller lots, the shipments are being sold much more quickly. It also helps minimise the risk of the importer. This is because rights holders tend to focus on only large shipments so the so-called small fry pass through the ports with ease.
Budgetary constraints hinder local authorities' enforcement efforts, so it is understandable why they focus only on large shipments. Intellectual property (IP) rights holders do not all have such limitations; however, they do tend to look for a return on investment so to speak. If they have to spend $2,000 to $5,000 on an interception or a raid, they will focus on large quantities of counterfeits, say 500 items up rather than a shipment of only two dozen of this and a dozen of that.
This approach seems sensible, but is it? The importers/infringers know which rights holders are active in enforcement and which ones are only interested in large stocks of counterfeits, so they take advantage of this knowledge and only deal in small amounts, knowing they are safe from action by the rights holders.
Notwithstanding the above, there are still some large shipments coming in and these are often the result of pooling by the importers. The importers of counterfeit goods join together to order products from overseas. By joining together they have better bargaining power and can also gain financial advantage through sharing bulk orders. These orders are often shipped together and then split up among the importers on arrival in Thailand. Thus, if the shipment is intercepted, the individual loss for any one of the group of importers is not high as losses will be shared in proportion to amount of goods of each importer in the shipment.
The way that infringers are now carrying out their business at the retail level has also changed considerably. One example is that of a seller of pirated CD and DVD movies in an area that is well known for pirated movies and computer games. A tape is played, which has been pre-recorded with a sales pitch. This sound system is located on a stall where the CDs and DVDs are displayed and also on the table is a box in which the customers put their payment for any products they buy. An unmanned cash register, so to speak. The actual seller stands off to one side to keep an eye on the proceedings but does not approach the stall to empty the cardboard until he is absolutely sure the coast is clear. He quickly pockets the money and then moves back to his former position.
This approach makes it very difficult for the police to be able to catch the seller. They need to be able to find him actually serving customers and receiving payment in hand in order to be able to charge him. As long as he is standing away from the stall, it would be difficult to prove that he is the owner or an employee of the stall. All the police could do is seize the infringing products but they would be unable to arrest anyone for selling them.
Despite the best efforts of the Thai government and IP rights holders in enforcement and suppression of infringement, infringers have matched them step for step with new ways of evasion and tactics to avoid detection and arrest. It is becoming increasingly difficult for the government and the IP right holders to resolve this problem in Thailand.
While the actual sale of counterfeit products increases, the amount of seized counterfeit products in each action seems to be decreasing, but costs for taking action remain unchanged. It is now time for IP rights holders to face the reality of the situation and enforce their rights more strategically. The use of investigators and lawyers to help in future enforcement work will be indispensable.
Chansin Tangburanakij is a lawyer with Baker & McKenzie's Bangkok office, e-mail Chansin.tangburanakij@bakernet.com
Prev
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Next
