South Africa has seen a dramatic rise in entrepreneurial activity, with many seeking to launch new products in the marketplace. For some, this means spending most of their time and budget on creating products that they believe will sell well and then marketing them in the hope of raising substantial awareness. However, with the success of a product comes the risk of the idea being copied and advantage being taken of the already established route to market, thereby affecting the original product's sales and brand.
These opportunists, known as counterfeiters, are active everywhere and the damage they can potentially cause is felt by many parties that:
- are either unaware of what steps they can take to protect their product; or
- take no measures to do so.
Since counterfeiters sell copied products at much lower prices, it can have devastating effects for the original product's creator or importer, including loss of goodwill and reputation in the genuine item due to sub-standard goods which negatively affects sales, and may even render a complete loss if the owner takes no immediate steps to protect their brand.
The current law has various remedies available to tackle counterfeiters. The two avenues that must be blocked for counterfeiters are:
- the import of counterfeit products (as they are usually manufactured in other countries); and
- the removal of these goods from the market so that genuine products retain their established place.
In order to block the import channel, there is an option to register brands (ie, trademarks or copyright) with Customs, which empowers them to conduct searches of imports and detain suspected counterfeit goods before they enter the country.
In addition, it is possible to apply for a search and seizure warrant through the various police offices in order to conduct a raid and remove counterfeit goods from the marketplace. These import and market strategies will lead to criminal and civil proceedings against the importer or seller of the counterfeit goods, which is effective in deterring counterfeiters from damaging a legitimate brand owner's business.
Another advantage of these strategies is that the action taken is swift in comparison to other forms of legal action which can take years. Further, having the infringing goods at hand before legal proceedings start limits the damage that the counterfeiter can cause during the time that it takes for the criminal and civil actions against them to be completed.
Notably, counterfeit goods are no longer limited to luxury items. Anything that exists in material form can be counterfeited, particularly products that potentially sell well. This even includes counterfeit food, water and other consumables.
Any party that creates or legitimately distributes a product that they believe will be well received in the marketplace should take the appropriate steps to protect it in the ways mentioned above but also consider consulting an anti-counterfeit attorney, as having an effective anti-counterfeiting strategy in place will not only deter fake imports and sales, but also give the genuine product the best possible chance of success.
This article was first published by the International Law Office, a premium online legal update service for major companies and law firms worldwide. Register for a free subscription.