Criminal offences (counterfeiting and piracy)
Infringement of trade marks and copyrights can be criminal offences, as well as being actionable in civil law. A range of criminal provisions are set out in the relevant Acts, and other offences such as those under the Fraud Act 2006 may also be applied. These criminal offences are most often associated with organised crime groups who are dealing for profit in fake branded goods or pirated products. However, these offences can also occur in legitimate business, for example if an employee uses the workplace to produce and/or sell quantities of fake DVDs or branded goods to colleagues or outside the office.
What is criminal Intellectual Property (IP) rights infringement?
Criminal IP offences are also known as "IP crime" or "counterfeiting" and "piracy". Counterfeiting can be defined as the manufacture, importation, distribution and sale of products which falsely carry the trade mark of a genuine brand without permission and for gain or loss to another. Piracy, which includes copying, distribution, importation etc of infringing works, does not always require direct profits from sales - wider and indirect benefits may be enough along with inflicting financial loss onto the rights holder. For example possession of an infringing copy of a work protected by copyright in the course of your business may be a criminal offence under section 107 (1)(c) of the Copyright, Designs and Patents Act 1988.
Not all cases that fall within the criminal law provisions will be dealt with as criminal offences and in many cases business to business type disputes are tackled by the civil law. Further information is available on what is the law and the guide to offences.
How will action be taken against you
Trading standards are primarily responsible for enforcing the criminal IP laws, with support from the police, and with investigative assistance from the IP rights owners. Private criminal investigations and prosecutions may also be launched by the right owners in some cases.
Criminal IP offences may be taking place in your workplace in a variety of ways. These include:
- employees selling copies of protected works or supplying fake goods within the working environment;
- company servers and equipment being used to make available (i.e. uploading) infringing content to the internet with the knowledge of management;
- using the work intranet to offer for sale infringing products to colleagues;
- external visitors entering your premises, to sell counterfeit and pirated items;
- using unlicensed software on business computer systems with the knowledge of management.
Not only can IP crime make you and your business liable to a potential fine of up to £50,000, and a custodial sentence of up to 10 years, counterfeiting and piracy can affect your business security and reputation, threaten your IT infrastructure and risk the health and safety of your staff and consumers. Make sure you are aware of these risks for business.
There are many more potential problem areas, therefore it is vital that you and your business understand how these problems might arise, so you can take steps to avoid them.
Advice and guidance is available on dealing with IP rights infringement.