IP Infringement and the Fashion Industry

IP Infringement in the Fashion Industry

The production and sale of counterfeit goods in the EU is widespread. This practice costs both the public and legitimate businesses billions of euros a year. The Fashion industry is an industry that is hugely affected by this.

The distribution and purchase of counterfeit clothing are often seen as victimless crimes – nobody is injured or killed. Surely it is just a matter of supply and demand the distributors are merely supplying consumers with clothing at a lower cost than the original manufacturer – how bad can the reality be?

A recent study undertaken by The European Observatory of Intellectual Property Rights in connection with the European Patent Office and the Office of Harmonization in the Internal Market (OHIM) found that the legitimate industry loses in the region of €26.3 billion in revenues each year. This loss, equating to nearly 10% of the sector’s total sales.

These figures rise dramatically when one considers the knock-on effect to other industries: €43.3 billion in lost sales, 518,281 job losses and a loss of €8.1 billion in government in revenue.

How can the legitimate players in the market combat the increasing number of counterfeit goods?

 We live in an age whereby the speed of technological advances overtakes the speed of new legislation.  IP litigation is very costly and therefore prevention is paramount.

Where to start?

The internet allows small business to sell and advertise their counterfeit goods in an inexpensive manner unlike traditional methods of advertising.

The threat is constantly growing, and businesses therefore need to have everything in place to ensure that they are able to take effective action against breaches of their rights, no matter where they are in the world. Owning strong IP rights is therefore of paramount importance.

Businesses can achieve this by:

• Registering their trade marks (names, logos, slogans) and designs (the shape and appearance of items) in all major markets of interest.

• Notifying the local Customs authorities of those rights.

• Keeping clear and comprehensive records of all trade marks and designs they create.

• Never allowing distributors, agents, business partners, etc. to register their trade marks and designs.

• Regularly monitoring the markets in which they trade, the websites of competitors and the major websites through which parties can offer products for sale.

• Establishing a policy and procedure for dealing with suspected misuse of their IP rights.

If you would like to discuss the protection of your intellectual property rights or if you have discovered that another company has been manufacturing and selling identical products, please give us a call and we will advise you on the best course of action.

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