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Anti-Counterfeiting Campaigns: Strategies for Thailand
Copyright 2001 Edward J. Kelly, Esq.
David Lyman Esq.
Tilleke & Gibbins International Ltd.
V. Supplemental or Complementary Options Available
Given the perceived dissatisfaction with the results obtained via traditional enforcement mechanisms based strictly on IP law, new strategies based on existing Thai tax and commercial law should also be considered when formulating a game plan to target infringers. These laws, set forth below, are enforced by a multitude of agencies in addition to the police. The enforcement of these other laws is far more popular with the government and the general populace because violations are considered public crimes as opposed to the supposed "victimless" private crimes against only trademark owners. If action through these other government agencies can complement or supplement claims based on intellectual property violations, then the objective of keeping counterfeit products out of the market may be brought closer within reach.
Any outline of a possible action plan should include as its realistic objectives a marked slowdown of the domestic production and sales, export and import in international trade of counterfeit products and components. To accomplish measurable results, trademark owners, their licensees, agents, distributors, dealers, lawyers and investigators should operate in close and long-term coordination with one another to protect the rights and value conferred by trademark protection.
Trademark owners with little familiarity of the Thai market should be aware of areas with large amounts of counterfeit products in Bangkok, including Sukhumvit, Silom, Pratunam, Ramkhamhaeng, Banglumpoo, Patpong (all tourist areas of Bangkok) as well as the yards of freight forwarders, consolidators and carriers for those fake products exported by land, sea and air.
Any effective action plan should consider retainer of public relations firms with experience in counterfeiting suppression to create awareness of public and target groups. We find that targeted, i.e. selected, senior Thai government, parliamentary and police officials, when informed of potential public relations and suppression campaigns, are much more amenable to support of enforcement efforts.
We have also found that the trademark owners who establish direct "hot lines" with people who are willing to act, at various stations/agencies (Interpol, Customs Department, Internal Revenue Department, Excise Department, Labour Department, Immigration Division, Industrial Works Department, Environmental Agency, FDA, etc.) often achieve measurable results faster than those owners relying on only traditional watchdog agencies to monitor markets for counterfeits.
Culturally, it is important to involve an owner's local Thai licensees, agents, distributors and dealers of protected/branded goods in any enforcement campaign. Local influence and connections could be useful in facilitating anti-counterfeiting actions. Furthermore, Thai people and Thai government officials are more likely to listen to the complaints of Thais than of foreigners.
When a particular raid action captures substantial quantities consideration should be given to the notification of the Revenue and Excise Departments for possible investigations and punitive actions on tax evasion by counterfeiters (VAT, corporate and personal income taxes, excise taxes, etc.).
Similarly, one might notify the Labour Department to check child and women labour conditions at any manufacturing or retail operation that is suspected of involvement in counterfeiting activity for legal compliance. One might also inform the Labour Department of the possibility that foreigners, involved in the counterfeit business and the export of fake goods, may not have proper work permits.
A similar strategy to create the proper deterrent environment would involve tipping off the Immigration Department in respect to known foreigners involved in counterfeiting who are working in Thailand under inappropriate visa status.
Where infringing medicinal or pharmaceuticals are found, one should notify the Thai FDA and the Ministry of Pubic Health of the possible use of inappropriate/toxic dyes, chemicals etc. in the production of the counterfeit goods. One should also be vigilant for product labeling violations which would come under scrutiny by the FDA. In relation to this, there is also the possibility of notifying officials of violations of the Consumer Protection Act.
It is possible to notify the Ministries of Industry, Interior and Environment of factories operating without licenses under factory laws, and/or violations of labour laws, health and safety laws, environmental laws, etc. One can request the closure of these factories if violations are found during a raid action. Likewise, one can request the Fire Brigade and Building Inspectors to check the conditions, e.g. fire safety conditions, of counterfeiters' premises, especially the conditions in small old shophouses, and then press for the possible closure of these "factories".
If a trademark owner becomes aware of a shipment of counterfeit goods, he should use his right and inform the Customs Department to seize the counterfeit products. Customs officials have the authority to board all vessels, open all containers, and seize all offending goods. The trademark owner or representative must be present and should be prepared to be responsible for all expenses incurred should the goods found not be counterfeits. Customs officials will upon request dispose/destroy the seized goods accordingly. There are obvious impracticalities in this method of enforcement. A full discussion of Thai Border Control Measures for suppression of counterfeiting activities is submitted with this paper.
VI. Practical Realities: Constraints and Limitations Associated with Enforcement Efforts
Generally, a trademark owner must be prepared to commit significant resources for any truly effective campaign. Costs will include special agents'/investigators' fees for conducting raids; legal incentives and rewards given and accepted by the police and/or other officials (authorized under Thai law: "Title 38, Incentives and Rewards, Chapter 1, General Principles Concerning Payments and Rewards," and is contained in the regulations of the Police Internal Manual); rewards for informers; and naturally, legal fees.
Besides the costs involved, one should also take an informed view of the proliferation of offenders and historical tolerance of counterfeiting, which has not been culturally viewed as a criminal activity. There is as yet no real broad-based Thai public sentiment to protect IPRs. The Thai authorities and the public give priority to offenses relating to national security, tax evasion, public order, and exploitation of people.
Worth noting as well is the very real threat of physical violence by the counterfeiters or their fellow travelers to the personal safety of trademark owners, representatives, licensees, distributors, law firms and investigative personnel, police. The gravity of the danger increases with the success of suppression efforts.
The good news is that as a result of petitions by trademark owners to their respective governments to review Thailand's eligibility for trade benefits, the present Thai Government Administration has rededicated its attention to the importance of IPRs in Thailand. On July 13, 2001, at the insistence of Prime Minister Thaksin Shinawatra, a formal meeting under the supervision of the Minister of the Interior was held and an action plan developed to address the legitimate concerns of IPR holders. As a result of the meeting, a permanent working committee was established with an express commitment to the suppression of intellectual property infringement. In the current political environment, it is advisable for trademark owners to cooperate with and assist the new government initiative by vigorously acting to defend and enforce their valuable marks against infringement.