On 4 September 2017, the UK Intellectual Property Office published an independent report examining the role social media plays in the sale and movement of counterfeit goods (full report available here).

The objectives of the report

The objectives of the research were to:

  • assess the role that social media plays in the sale and distribution of counterfeited and pirated physical goods from six representative sectors: alcohol, cigarettes, clothing, footwear, perfume and watches;
  • estimate recent levels of counterfeiting within the UK;
  • understand the extent to which this is moving online;
  • gauge how it is helped to do so by online social media platforms; and
  • assess the scale, impact and characteristics of infringements, as well as opportunities for IP infringement.

The report’s conclusions and recommendations

Perhaps unsurprisingly, the report concludes that social media provides a forum for facilitating online intellectual property infringement:

“Our consumer data reinforces claims made by government enforcement agencies that platforms, such as Facebook, encourage IP infringement and this is particularly flagrant within closed groups. Counterfeiters see social media as a haven and actively use both open and closed group pages, along with ‘likes’ and ‘retweets’, to disseminate their offerings. The social media platforms make it easy to move channels by establishing fan pages and making it possible to carry out transactions on or off the social media platform. Social media amplifies counterfeiters’ messages by increasing the connectivity of potential complicit consumers. Crucially, these connections do not have to be strong; as the threshold for connection on social media is low.”

Relevance to the Sport industry

Whilst the report does not focus specifically on sport as a sector, it is of importance to the industry in two respects:

  1. Counterfeiting is a well-recognised problem in the sport sector. For example, an OHIM study in 2015 estimated that sales of counterfeit sports equipment such as golf clubs, tennis rackets, balls etc. represented financial losses to the legitimate industry of €500 million and approximately 2,800 job losses. Moreover, given the value attaching to sponsorship and merchandising deals, the importance of preventing the manufacture and sale of “knock-offs” is key, particularly for brands such as teams (e.g. Premier League Football clubs) and some governing bodies. In January 2016, EU trade mark legislation was amended to provide rights owners with increased rights to seize infringing goods in EU customs (see our analysis here for more detail);
  2. On a broader level, the report’s focus on the role of social media in perpetuating infringing content generally is of interest. Social media represents a unique problem in the way that it is capable of disseminating unlawful content at speed and on a huge scale. As Sports Shorts has discussed previously, this is problematic due to the timeframes available for removal of infringing content. This is because the value of a live event is heavily tied to the period for which it is broadcast. Developments such as the Premier League’s live blocking injunctions (covered by Sports Shorts here and here) are beginning to assist with this, although it remains to be seen to what extent this will counter the ability of the “particularly flagrant” infringement encouraged via closed social media groups where, for example, links to infringing streams are shared. Indeed, notably, despite the report’s remit focussing on non-sport related sectors, much of the Industry Survey Responses (particularly from FACT (the Federation Against Copyright Theft) focussed heavily on the issues faced by sports stakeholders, such as the Premier League and its licensees, in relation to infringing streams of live events and the sale of devices such as Kodi boxes).

What next?

The report’s recommendations include “improved industry cooperation in supplying essential headline data for government and policy makers to more easily understand the trend in the market”, because “developing a greater understanding of consumer behaviour… is pivotal at this time”. Indeed the UK IPO commissions a substantial body of research into IP infringement on an ongoing basis, including a regular online copyright infringement tracker, which is expected to feed into any initiatives arising from this report.

At this stage, the main value to brands concerned to protect their IP is the information provided by the report (including, in particular, the varying levels of detail provided by Google and various social media platforms such as Facebook and Twitter as to the processes and policies they have in place for addressing infringing material.